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Case Study

Boosting and sustaining operational excellence

By Luis Vivanco, Carlos Cordon and Magdi Batato

9 pages

February 2025

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Reference: IMD-2653

The case explores the principles and challenges of operational excellence through the experience of Magdi Batato, former EVP of Operations at Nestlé. It examines how he implemented Mission-Directed Work Teams (MDWTs) to empower front-line workers, align goals and drive accountability within a collaborative culture. MDWTs, introduced in South Africa and later adapted in Malaysia, emphasized team autonomy, transparent goal alignment and continuous improvement tools. Supervisors transitioned into coaching roles, fostering collaboration through Mini Business Units (MBUs) and Service Level Agreements (SLAs). These initiatives improved teamwork, reduced downtime and enhanced problem solving. Cultural and hierarchical barriers were addressed through tailored leadership development and training programs. The document also highlights how MDWTs became part of Nestlé’s global Nestlé Continuous Excellence (NCE) program. Combining tools like LEAN and Total Productive Maintenance (TPM) with leadership and behavioral shifts, NCE promoted sustainable improvements. Magdi stressed that while tools are essential, success depends more on fostering cultural adaptability and alignment with measurable business outcomes. A recurring theme is the balance between technical tools and behavioral dynamics. Misconceptions about continuous improvement are addressed, emphasizing its role as a means to achieve results rather than an end in itself. The narrative explores how these principles apply beyond manufacturing, touching on functions like marketing and HR, while considering the potential of emerging technologies such as IoT and AI to enhance operational excellence. Magdi’s leadership journey offers practical insights for aligning technology, culture and tools to achieve and sustain operational excellence.

Learning Objective

Understand that continuous improvement is vital for the long-term sustainability of competitiveness.
Appreciate, in terms of strategy, the need to integrate company culture with continuous improvement.
Understand that continuous improvement is sustainable only if it’s a company-wide effort.
Recognize the need for worker empowerment and education as requisites for continuous improvement.
Acknowledge the fit and potential of digital technologies in continuous improvement.

Keywords

Change Management, Digital, Operations, Continuous Improvement, Lean Tools, Performance Measurement

Settings

World/global
Nestlé, Consumer Goods, Food and Beverage
2007-2024

Type

Published Sources

Available Languages

English

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