An American Firm, Kraft foods Incorporation is a grocery manufacturing and confectionary firm formed in 2012. In the Chicago suburb, Northfield, Illinois is a place where headquarter of Kraft Foods Group is established. The organization is formed by demerger. Mondelez International was the new name of the demerger from Kraft Foods (About Kraft, 2012). In turn, Mondelez is a confectionary company and multinational snack whereas grocery business is the main focus of this North American Kraft food Group incorporation. Listed on NASDAQ, Kraft foods is a public company with independent standings.
Convenience foods, confectionery, snack foods, dairy foods, cheese and beverage are the core businesses of the organization. There are 128 brands in the list of distributed, owned, developed and developing brands in Kraft Foods Incorporation (MacArther, 2012). Some of the brands are Boca Burger, Better Cheddars, Bagel-Fuls, Back to Nature, Ali Coffee, Air Crisps, Crystal Light, Cracker Barrel Cheese, Clight, Chipsmore, Cheezels, Charada, O'smile, Mostro, Miracoli and Lyuks etc.
Growth and Expansion Plans
The Kraft Foods is the new face of the confectionary business that had been working since early 20th century. The company has been growing and employees hundreds of thousands of employees round the globe. The products are designed in such a way to fit tastes from across the world. Kraft Foods has billions of dollars assets and earns over a billion dollars profit on annual basis. The company plans to strategically grow and maintain its industry position of a leader. This is only possible if the company can maintain a steady growth rate. The employees are main concern of the company and thus can turn out to be catalyst of change and growth. The Kraft Foods is facing some challenges that can grow with time. Some of these challenges are the expenses that are incurred on training and the turn over cost of employees. The company sees the retention problem as a challenge on the road of growth.
Planning to split into two independent organizations, Kraft Foods Inc. planned to cut its positions to 1,600 in Canada and U.S. The downsizings will lessen headcount by 3.5% meaning 46,500 people worldwide employs for food maker. Trimming the business and corporate units, U.S. management centers consolidates and reorganized its domestic sales team. In sales, there are about 40% cuts and from eliminating positions with vacant status, about 20% of positions will be available. In an statement, the Chairman and CEO of Kraft named Irene Rosenfeld said that the splitting into two organizations form single Kraft Group will lead to more competitive and more learner organizations. To optimize the iconic brands, the North American team has streamlined the operations and thus became able to deliver top-tier and more sustainable performance. Later in this year, with the revolving of the North American grocery company, management offices of Kraft in U.S., that are currently managed at four locations will be cut short to be managed at two locations. By the end of 2013, Kraft's Glenview management center will close and by December 2012 in Tarrytown, New York Kraft's 440-employee potion business, and in East Hanover, New Jersey, its Planters unit will move to the Chicago area.
Talent retention or employee retention is important in the dynamic world of today since the cost of hiring, training and developing employees is too high. The organizations seek ways in which they can retain a new or old employee who is skilled and talented to do the job. The demand of high performing employees is high and thus such people are found quitting jobs in order to be more satisfied and to grow in their career. The talent retention requires offering a healthy work environment, supportive business culture, effective communication and handsome salary packages so that the employees retain in the company. Kraft Foods also faces the challenge of employee retention and needs to invest a reasonable budget on the retention of employees that are highly skilled to do the job.
The employee retention is high if less number of employees are seeking new jobs and is low when more employees seek new jobs. While Kraft Food is ranked amongst the companies that are much concerned as well as successful in retaining employees (Kraft Foods: No. 18 in the DiversityInc Top 50, 2013) the company believes that employee retention is a major concern that rises as a future trend. Being the largest confectionery, food, and beverage business in the world, Kraft Foods need a reliable and stable workforce to maintain its multibillion dollar revenue stream. It is often hard to retain employees when they are bound to work in a closed space for some time. The company follows employee retention strategy by offering a variety of locations to its employees for work. The company claims that the employees working in East can also be well adjusted in Midwest and can offer those positions in company sites at Madison, Wisconsin, Michigan etc. (Kukreja, 2011). To retain its employees, the company does not move them only between different locations but also between different businesses. For example, the manager working under one brand can be relocated to another brand in order to help him learn something new and grow. Thus a change of arena and environment is helpful. Kraft Foods believes in training of employees for the purpose of learning and growth.
The company deploys its benefits system from perspective of employee retention too. The compensation system is flexible and benefits are competitive that help the employee rate Kraft foods reasonably above other companies. The company also offers optional pension plan and the saving plans. From disability to insurance to scholarship programs are offered to retain the employees in the longer run and help they have a future in the company. The employee retention becomes an issue especially given the big size of company where the employees are coming from different and diverse backgrounds.
Employment as an Expense
The hiring and selection process of employees is not only time taking but also very challenging in terms of effort and cost. The Kraft Foods overcomes the extra costs and time spent on the training of employees by outsourcing employment for many of the tasks including the CSR and the customer care. The company also hires contract basis employees so that the cost of additional benefits can be saved that are normally offered to all the regular and fulltime employees. The company has contracted many staffing companies that provide the candidates that best suit the requirements provided by Kraft Foods against specific positions that are vacant in the organization. Since the staffing organizations are expert in hiring, they are very effective in choosing the right person. Yet it is the role of Kraft Foods to retain these employees and motivate them so that they may involve in increasing the productivity of the organization.
The employee turnover is a cost that an organization has to pay when its employee retaining rate is low and the employees are finding other jobs to switch as soon as possible. The turnover cost can be measured in the terms of time, cost and the delay in performing procedures of the organization. Thus it is not enough that the company saves the expense of directly hiring the employees but it also needs to motivate the employees to work with the company. This will help the Kraft Foods avoid the costs of turnover and to retain its best and talented people. The talented people can be attracted by offering them handsome salary packages but this is not enough. These people should be offered a whole culture that is productive for work and employee team building. A sense of ownership in the employees that comes from motivation helps them retain for long.
Outsourcing and contract-Based Jobs
Multitasking is becoming a trend in the 21st century. Thus people are working as well as studying that requires them to look for flexible jobs. Thus there are people that look for flexible jobs and the ones with nature of contract-based or part time. The Kraft Foods, in order to manage the workforce, often outsources the employment needs and hires contract-based employees. This strategy is suitable since the employees are able to work in system that offers high flexibility and the work-life balance is maintained. The contract-based jobs are attractive for those that can work for a year or two with the company to work anytime but not 12-8pm. The contract-based jobs save the expenditures of the company on training, motivation and career development.
There are also some disadvantages of hiring the contract-based employees in the company. The employees are at disadvantage in the contract-based jobs since they are not entitled for the benefits like food service, security, facilities, marketing, lab techs, IT help etc. The contract-based employees also need to be replaced after some time. The contract-based employees often complain that they are forced to move among different locations in order to fulfill the labor needs…