Nestle’s offers some of the best examples of how re-orchestrating business can create more value and a bigger pie for all stakeholders. As Nestle’s CEO puts it: “Creating Shared Value is a fundamental part of Nestlé’s way of doing business that focuses on specific areas of the Company’s core business activities – namely water, nutrition, and rural development – where value can best be created both for society and shareholders.”
Nestle has demonstrated the ability to deliver great results to customers, suppliers and shareholders by sharing value across its value chain. The best example thus far is their Nespresso range of products. Early on Nestle realised that rather than paying their coffee bean farmers a fairtrade price, they could create more value by working with the farmers to help them produce better quality beans, increasing farmer productivity and a greater yield per acre farmed. Because the farmer produces more higher quality beans Nespresso is able to pay the farmer more. Nespresso gets value from having access to a supply chain of high quality beans and the customer gets a better product and experience, Value is created and enhanced across the supplier, producer and the consumer value chain – farmers get paid more – because yields are greater less land is required for farming, so society benefits from fewer forests being destroyed for farmland which reduced CO2 emissions, Nestle benefits from being able to sell a better product at a higher price and the consumer gets a better experience. Value is enhanced and shared across the value chain.
Nestle has an excellent website dedicated to communicating their Creating Shared Value initiatives