Management: Case Study of Nestlé: Osee R. Lieberman Ottawa University 2015

Management: Case Study of Nestlé
Osee R. Lieberman
Ottawa University
2015
Case Study: Nestlé 2
Nestlé
Business strategies are the most important tool for a company to achieve goals effectively
for an extended period of time. In order for companies’ to be successful, the managers and
CEO’s must have outstanding competencies for adequacy of strategies to fall into place within
the organization. Competent managers and successful business strategies performed within an
organization make competition between rival companies tough. Nestlé is an international
company that has been very successful for a long time.
The kind of business-level strategy that Nestlé is pursuing is significantly intelligent in
regards to decisions being made, what objectives to pursue, and how to achieve goals through the
adequate use of resources (Jones & George, 2013). The business-level strategy that Nestlé uses
is planned in a way that competes against its rivals. Also, Nestlé takes advantage of
opportunities that their rivals do not. According to Jones and George (2013), Nestlé teams up
with farmers to coach them on how to boost their crops in numbers. Nestlé encourages its
business partners to recycle and educates them on being sustainable (Jones & George, 2013). By
engaging in such strategies, “Nestlé has cut its use of packaging materials by 518,000 metric tons
in the past two decades” (Jones & George, 2013, p. 209). One of the business-level strategies
that Nestlé engages in is the low-cost strategy. They drive their costs down lower than their
rivals by engaging in sustainable practices and educating within their market of farmers and
distributors. By educating the people that they get their products from they are minimizing their
cost which is part of their low-cost business strategy. They may not have the cheapest products;
however, they are creating ways to be less wasteful which will eventually save money.
The CEO’s and managerial teams within Nestlé have a diverse set of competencies.
According to Mudd (2001), the CEO and the managers speak many different languages in order
for their business to flourish in different parts of the world. By speaking the language of the
locals they are able to understand the wants and needs of the locals (Mudd, 2001). The managers
engage in strategic leadership as well. They want to be at the same level as all members of the
organization so that they know the needs of everyone. Managers work all around the world so
that they can get an advantage in the market. They believe in creating a shared value within
society (Mudd, 2001). Mudd (2001) stated that because Nestlé has stresses internal growth
which creates a substantial 4% internal growth rate per year.
Nestlé has a competitive advantage because of how many years they have been around
(Mudd, 2001). Home for Nestlé is originally in Switzerland; however, they have over 400
factories in 81 countries now (Mudd, 2001). That is another reason why Nestlé has a
competitive advantage over its rivals. Probably, Kraft and General Mills do not have a long
global influence like Nestlé has.
One of the reasons why Nestlé is doing to much better than its rivals is because of the
global market that it has. “The company has decades of experience with operating in different
cultures” (Mudd, 2001, p. 36). Nestlé is also trying to learn what consumers want and learning
what locals want in various parts of the world (Mudd, 2001). Mudd (2001) also stated that
because of the 134 years of operations throughout the world the international knowledge that the
managerial team “makes it possible for Nestlé to operate on as grand a scale as it does” (p. 36).
It seems that Nestlé is so successful because of the social responsibility the company
gives to society. Not only is the company trying to educate sustainability, but they are also
educating other companies they work with to be sustainable.

This eventually saves everyone money along with benefiting our planet. After learning all of
this about Nestlé, I want to buy their products more and maybe work for the company one day.
References
Jones, G.R. & George, J.M. (2013). Essentials of contemporary management (5th ed.).
McGraw-Hill Inc., New York, NY. ,
Mudd, T. (2001). Nestle Plays To Global Audience. (Cover story). Industry Week/IW, 250, 34.

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Management: Case Study of Nestlé

organization make competition between rival companies tough. Nestlé is an international

company that has been very successful for a long time.

The kind of business-level strategy that Nestlé is pursuing is significantly intelligent in

which creates a substantial 4% internal growth rate per year.

global influence like Nestlé has.

educating other companies they work with to be sustainable.

McGraw-Hill Inc., New York, NY. ,

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