...Case Study Analysis 8 Nestlé: Sustaining Growth in Mature Markets Strategic Management Instructor Dr. David J. Rambow Associate Professor of Management Summer Term 2011 Anchorage Campus Wayland Baptist University Nestlé: Sustaining Growth in Mature Markets Introduction Dated back to 1866, the Nestlé company had acquired profound knowledge of markets all over the world over the previous 130 years. Nestlé is the leading position in the global food industry with operated factories in 77 countries and sells its products on all six continents. Nestlé has a broadly diversified business portfolio and with leading global market shares in numerous product categories including coffee, mineral water, dairy products, nutrition and baby food, ice cream, confectionary, pet food, and chocolate. Nestlé is also committed to providing quality brands and products that are essential to good health. In doing so, Nestlé incorporated nutritional elements into vast array of product categories to promote food that are safe of high quality (Raisch & Ferlic, 2006). Peter Brabeck-Letmathe took the job as CEO of Nestlé in June 1997; he faced the challenge of having to improve the company’s profitability. In order to generate the financial means required to invest in growth initiatives, Brabeck launched a suite of process innovation initiative in an effort to maximizing existing assets, maximizing capacity utilization, and maximizing distribution logistics...
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...Abstract Nestle is presently one of the largest food company in the world. Nestle has been called the most conglomerate companies ever, with more than 400 plants in 60 countries and growing. Nestle is Switzerland's largest industrial company and the world's leading food processor. The food giant ranks as one of the 100 largest companies in the world. Nestlé’s primary products include beverages such as (coffee, chocolate drinks, mineral water, and soft drinks), dairy products, infant formula, culinary products (soups, seasoning, condiments), frozen foods and ice cream, yogurt and chilled desserts, and chocolate. Nestlé is committed to providing quality brands and products that are essential to good living. In doing so, the Nestlé name has become synonymous with great-tasting, nutritious food and beverage products. (nestleusa.com) For well over a century, Nestle commitment to producing foods that’s uniquely fulfilling people's needs has been the secret ingredient in everything we they make. Introduction Nestle is know as one of the world’s leading Nutrition, Health and Wellness Company. The Company's priority is to bring the best and most relevant products to people, wherever they are, whatever their needs, throughout their lives. Nestle boasts a broadly diversified business portfolio and has leading global market shares in numerous product categories, which including soluble coffee, bottled water, dairy products, nutrition and baby food, ice cream, frozen prepared dishes...
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...Reading and analysing Nestle case plus doing a draft write-up: * Page 564: Nestle has been very successful and is in the “Food & Beverage” industry. Many of their products have reached maturity and this is a big challenge for Nestle. * Page 565: Nestle is facing intensive competition nationally and regionally. Nestle’s global competitors are Kraft, Masterfoods and Unilever. Nestle went through mergers with massive investments that has affected Nestle operational efficiency. Nestle ‘s organic growth is also in the mature markets therefore Nestle needs to strength its innovative capabilities in order to be more competitive in the organic mature market. Nestle program called “operational excellence in 2007 where Nestle’s key objectives are to improve supply chain productivity, optimise planning, eliminate overheads and reduce product complexity” {Raisch & Ferlic, 2006} * Page 566: The are new opportunities for Nestle in the area of wellness and nutritional product market segment. Brabeck the Chief Executive Officer (CEO) aimed at two main strategic goals that is developing nutrition and wellness as a value added feature and reinforcing Nestle’s leading position as specialised nutritional products. * Page 567: * Page 568: * Page 569: * What do you make out from the info given in page 571: * What do you make out from the info given in Page 572: * What do you make out from the info given in Page 573: * What do you make out...
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...NESTLE’: SUSTAINING GROWTH IN MATURE MARKETS 1. Describe the characteristics of each of the following elements in the Current Competitive Landscape: a. Globalization - Nestle’operates in 77 countries and sells its products in all 6 continents. Its global position is further enhanced by acquisition of companies which have an established global presence. b. Technology – As part of the GLOBE initiative, Operation Excellence program was implemented which deals with creating concepts & systems to optimize productivity, improving supply chain, eliminating overhead & reduce product complexity. Installation of common information systems in order to integrate all information from all business units. c. Knowledge - As part of the thrust to achieve internal growth , the company invested on extensive research and development . Existing products undergo improvement/changes such as changes in shape, packaging or even taste. Other products are being moved to a new promising product segments in order to maximize earning potential. d. Strategic Flexibility – The launching of Global Business Excellence initiative or GLOBE has transformed Nestle to what success it is enjoying at the moment. GLOBE covers a broad range of strategic objectives and also to improve operational efficiency by integrating the company’s businesses on a global scale. e. Quality – Putting into consideration consumers whose primary motivation to purchase a product is the product’s...
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...Nestle: Sustaining Growth in Mature Markets Describe the characteristics of each of the following elements in the Current Competitive Landscape: Globalization, Technology, Knowledge, Strategic Flexibility, Quality, and Profit Pool. Nestle’ recognizes that increasing globalization is leading to the development of more and more international recommendations. Although, as a general rule, these recommendations are addressed to governments they inevitably impact on business practices. [ (Brabeck-Letmathe, 2004) ]. The internet is changing the way of doing business. It concerns business-to-business relations and also the Company’s interaction with consumers. In this respect nestle’ S.A. has an Internet Privacy Policy which is available on the Corporate Website. This policy aims to protect the privacy of the users; it covers, for instance, the accessing, deleting or correcting of information, the security of information, and relates also to tracking technologies [ (Brabeck-Letmathe, 2004) ]. Nestlé’s broad known of their products and laws that are required in order to design different product are impeccable. Needless to say one company has to know about water, using raw materials, nutrition for not only infants but everyone including animals. Nestlé’s knowledge of human rights gives them a strong understanding of strategic flexibility. Nestle’ recognizes that governments are ultimately responsible for the establishment of a legal framework for protecting human rights...
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...“Nestle: Sustaining Growth in Mature Markets” Bus 499 Summer Quarter 2010 Describe each of the following elements in the Current Competitive Landscape: Globalization, Technology, Knowledge, Strategic Flexibility, Quality, and Profit Pool. The Nestlé Food Company has been part of the global community since it was first founded in 1866 marketing its products in 130 countries across the world. “Over the previous 130 years, Nestlé had acquired profound knowledge of markets all over the world, and enjoyed great success in adapting its products to local tastes” (Hitt, Ireland, & Hoskisson, 2009). In doing this Nestlé has retained the reputation as a heroine company who “thinks globally but acts locally” (Hitt, Ireland, & Hoskisson, 2009). Nestlé has not just succeeded in the food industry but is taking strong leads to impact nutrition, health, and wellness. The Nestlé Company continues to stay competitive within the global market while continually working with a failing economy; according to Barbara Kollmeyer of Market Watch (2009) "It's still a good defensive stock. Its international profile, combined with presence in 25 businesses provides good resilience in a downturn. The development of the product mix towards Nutrition and Health should have increased the group's defensive profile. This strategy is based on a price positioning that should remain competitive.” The knowledge that Brabeck introduced in 1997 brought many new strategies to Nestlé the...
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...a) Mission Statement: "Nestlé is the largest food company in the world. But, more important to them is to be the world's leading food company”. At Nestlé, we believe that research can help us make better food so that people live a better life. Good Food is the primary source of Good Health throughout life. We strive to bring consumers foods that are safe, of high quality and provide optimal nutrition to meet physiological needs. In addition to Nutrition, Health and Wellness, Nestlé products bring consumers the vital ingredients of taste and pleasure. Vision statement: “Nestlé aim is to meet the various needs of the consumer every day by marketing and selling food of a consistently high quality. The confidences that consumers have in our brands is a result of our company’s many years of knowledge in marketing, research and development, as well as continuity – consumers relate to this and feel they can trust our products”. In particular, we envision to Lead a dynamic, motivated and professional workforce – proud of our heritage and positive about the future Meet the nutrition needs of consumers of all ages – from infancy to old age, from nutrition to pleasure, through an innovative portfolio of branded food and beverage products of the highest quality. significance of stakeholders Deliver shareholder value through profitable long term growth, while continuing to play a significant and responsible role in the social, economic, and environmental sectors of Pakistan. Effective...
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...economy—an overview Economic Growth stars Classification of countries by income Market opportunities in DCs World population trends Dealing with currency risks 2 2-0 Introduction • The level of economic development in the target country is a major determinant of global market potential and opportunities • Globalization and forms of freemarket capitalism prevail almost everywhere today • Since the 2008 financial crisis, however, much uncertainty has crept in. 2-3 2-1 The World Economy—An Overview • The world economy has changed profoundly since WWII: in the western world, trade boomed and GDP rose constantly at a 2-3% rate… • Globalization (economic integration) was estimated to be 10%; today it is 50% (by some measures) and still rising • Global companies have arisen to respond to global market demands and opportunities, global competitors have displaced local ones 2-4 Growth of world GDP Figure 1.1 Growth of Real World GDP, 1975–2005 500 – 450 – 400 – 350 – Volume 300 – 250 – World GDP ~$70 Trillion today World population 7,1 Billion 200 – 150 – 100 – 1975 1980 1985 1990 1995 World GDP 2000 2005 Countries by annual GDP growth Recent World GDP growth Year 2003 2004 2005 2006 2007 Annual Growth, % 3.8 4.9 4.6 5.3 5.4 Financial boom in West Boom in China & India 2008 2009 2.8 -0.6 Financial crisis in West West low growth 2010 2011 2012 2013 2014 FC 5.1 3.8 3.3 3.6 4.2 7 Growth of world GDP per capita ...
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...School Management E-5475 – Strategic Management of Growth Companies Course Syllabus – Spring 2012 November 25, 2011 Course Logistics Day and Time: Tuesday, 7:35-9:35pm Location: Byerly Hall 013 Course iSite: http://isites.harvard.edu/course/ext-23550/2012/spring Instructor: Dave Power 617.694.2472 President, Power Strategy dave@powerstrategy.com Office Hours: Before class and by appointment ------------------------------------------------- About the Course Course Description and Overview Growth companies are the engines of product innovation, market expansion and value creation. But sustaining the growth of these dynamic private companies -- typically with revenues of $10 to $100 million -- requires a unique set of skills, different from those required in either startups or large public companies. Many promising growth companies stall as their business models mature and they outgrow the processes and teams responsible for their early success. Using a mix of case studies, group discussions, interactive exercises and written assignments, this course provides a general management perspective of growth companies: strategy, execution, team, and capital. You first learn different growth strategies, including market disruption, “white space” discovery, and business model innovation. You then connect strategy with execution through market selection and positioning, “lean” development of new offers...
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...With the U.S. economy struggling to expand and Europe on the brink of recession, fast-growing markets in the developing world offer the best opportunities for boosting revenues and profits today. Many companies in the developed world are keen to follow in the wake of corporations in a variety of industries—such as Boeing, Coca-Cola, DuPont, General Electric, Hewlett-Packard, IBM, Oracle, Unilever, and Disney—that appear to have succeeded in going global. Globalization is no panacea, however. Success abroad varies widely, and it’s often tough to boost profits by investing overseas. Because most studies look at cross-industry patterns to draw lessons about how to succeed at globalization, they can be Rajiv Lal is the Stanley Roth Sr. Professor of Retailing at Harvard Business School. misleading. When we focused on one industry—grocery retailing—we found that, with a few exceptions, globalization’s benefits had not accrued to retailers. In contrast to other industries, grocery retail is still dominated by local players in most countries. International players are almost entirely absent from even the largest retail markets. And every grocery retailer that has ventured overseas has failed as often as it has succeeded. Moreover, our research shows that on average, the extent of internationalization does not have a significant effect on retailers’ revenue growth rates or their profit margins. Some industries clearly can’t travel across borders as well as...
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...Business Strategy Gourmet Bakers Business Strategy (Business Strategy plan for Gourmet backers) PREPARED FOR: Sir Ghulam Ahmad Rana PREPARED BY: Mohammad Ali Khan 083805-209 Mohammad Mujtaba Shafi 083805-181 Ali Aslam 083805-182 Hamza Ejaz 000000000 Ali Raza Goraya 083805-168 Shoaib Malik 083805-099 May 21, 2012 Declaration This is to certify that Report entitled “Gourmet Bakers” which is submitted by us in practical fulfillment of the requirement for the award of degree BBA (H) to University of Management and Technology, Lahore comprises only our original work and due acknowledgement has been made in the text to all other material used. Name of Students: Mohammad Ali Mohammad Mujtaba Ali Aslam Hamza Ejaz Ali Raza Shoaib Malik Date: May 21, 2012 Acknowledgement All praises are for Almighty Allah, which is the creator of this universe. We owe a great many thanks to a great many people who helped and supported us during the writing of this business plan. Our deepest thanks to Lecturer, Sir Ghulam Ahmad Rana the guide of the project for guiding and correcting various documents of ours with attention and care. He has taken pain to go through the...
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...26 7.3 Product Offering 28 7.4 Lindt’s positioning in comparison to Competitors 33 8 Organizational Structure 34 8.1 Organisational Process 35 8.2 Organisational Culture 36 9 SWOT Analysis 37 10 Recommendations 38 10.1 Exposing the Corporate Social Responsibility 38 10.2 Product Development to meet upcoming consumption trends 38 10.3 Market penetration in Spain 40 10.4 Penetration of Emerging Markets 41 10.4.1 Asia Pacific 41 10.5 Entering new Segments 43 10.6 Pushing profitable Product Lines 45 11 Bibliography 47 11.1 Books 47 11.2 Documents from Databases 48 11.3 Journals 50 11.4 Websites 51 II List of Figures Figure 1: Confectionery industry segmentation 5 Figure 2: Market value of the confectionery market in the period 2004-2009 and the expected growth until 2013 6 Figure 3: Stage of industry life cycle mature markets (Western Europe, North America) and immature markets (Middle East and Africa, Eastern Europe, India, China, Russia) 10 Figure 4: Growth rate of the global confectionery sales by region in the period 11 2007/2008 and forecast for the period 2008-2013. 11 Figure 5: Global confectionery market share by value 12 Figure 6: Strategic groups of the confectionery industry 13 Figure 7: Sales in million CHF and change in % in the period 2005-2008 14 Figure 8: Resource Base of Lindt & Spruengli 15 Figure 9: Value Chain of Lindt &...
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...solution services, to its large base of customers in India and abroad. The company boasts of a global presence today. How does it keep abreast of the marketing environment? We speak to Biswaroop Ukil, General Manger–Marketing (Power Products and Solutions), to find out. stabilizes to a certain extent, the domestic demand for T&D products is expected to grow, given the picture painted by central planners and various government agencies. The Indian industry for T&D products is quite mature, with several local manufacturers and multinationals possessing the necessary technology, production facilities, and exclusive sales and service networks across the country. Apart from firms employing individual market survey techniques and tools, there are industrylevel bodies/associations that gather and compile generic industry-level information, which is then used by the members of the association to chart out the course of their businesses. This industry-level information, along with the independent sets of market research data, is then analysed to ascertain all related information, such...
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...services and rivalry among existing competitors 2. Porter’s Generic Strategies How do I gain a competitive advantage in business? What strategies will help me achieve my goals? 3.1 The Cost Leadership Strategy 3.2.1 Increase profits by reducing costs 3.2.2 Industry-average prices 3.2.3 Increasing market share 3.2.4 Low costs mean greater profit You will need: 3.2.5 Strong control over Cost of Labour 3.2.6 Preferential access to raw materials, components etc. 3.2.7 Take advantage of economies of scale 3.2.8 Easy access to supply chains and affordable logistics 3.2 The Differentiation Strategy 3.3.9 Create a product that is perceived as unique 3.3.10 Brand Loyalty 3.3.11 Can provide better insulation from competition You will need: 2.2.4 Strong R&D 2.2.5 Creativity 2.2.6 Unique Marketing Strategy 2.2.7 Innovate to stay ahead of the competition 2.3 Focus Strategy 2.3.1 Focus on niche markets 2.3.2 Unique understanding of the market 2.3.3 Either cost leadership or differentiation You will need: 2.3.4 Unique/specific insight into the market 2.3.5 Knowledge of suppliers and specialists 2.3.6 Willing to take the risk that the niche may disappear 3. Value Chain Analysis Value Chain Analysis helps you identify the ways in which you create value for your customers, and then helps you think through how you can maximize this value: whether through superb products, great services...
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...Strategic Management Journal, Vol. 12, 535-548 (1991) PORTER'S 'COMPETITIVE ADVANTAGE OF NATIONS': AN ASSESSMENT ROBERT M. GRANT Management Department, California Polytechnic State University, San Luis Obispo, California, U.S.A. Porter's Competitive Advantage of Nations is an important book which bridges the gap between strategic management and international economics while contributing substantially to both. Porter's analysis ofthe impact of national environment on international competitive performance demonstrates the potential for the theory of competitive strategy to rescue international economics from its slide into refined irrelevance, while simultaneously broadening the scope ofthe theory of competitive strategy to encompass both the international dimension and the dynamic context of competition. Nevertheless, the breadth and relevance of Porter's analysis have been achieved at the expense of precision and determinancy. Concepts are often ill defined, theoretical relationships poorly specified, and empirical data chosen selectively and interpreted subjectively. The Competitive Advantage of Nations is an important book. Among Porter's books to date, it is the broadest in scope and the most ambitious in intent. The book addresses a question which lies at the heart of economic and managerial science: 'Why do some social groups, economic institutions, and nations advance and prosper?' (Porter, 1990: xi).This is no new issue: the same question stimulated Adam Smith's...
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