Case Study: Chapter 4 – Nestlé

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HRM 560: Managing Organizational Change February 03, 2013 Discuss the organization change that Nestlé has undergone. Nestlé is a global company in an increasingly competitive environment. During the 1900’s, Nestlé began to make all the necessary changes for global expansion by “purchasing local subsidiaries in foreign markets” (Palmer, 2009, p. 109). The start of World War I marked more organizational changes for Nestlé. The demand for milk presented a great opportunity that was not ignored. Nestlé used this time to move into the US market purchasing factories to keep up with the demand for milk and other dairy products; emerging as an industry leader responding quickly to the change of demand. The Second World War prompted Nestlé to move many offices from Switzerland to the states supporting their “commitment to changing the company in order to increase efficiency and productivity” (Palmer 2009, p. 109). Nestlé’s devotion to growth leads the organization to diversify outside of the food industry becoming the majority shareholder for L’Oreal. L’Oreal’s financial standing left Nestlé feeling the pressure of taking on such a big risk. The company decided to take another step towards something new with the purchase of a pharmaceutical and ophthalmic company known as Alcon Laboratories Inc. The 1980’s shows Nestlé’s CEO, Helmut Mucher, refocusing the company with the acquisition of Carnation and ridding the company of other businesses that were not beneficial to Nestlé’s continued success. In order for Nestlé to continue to develop, they must also continue to undergo significant changes in their overall strategies. As companies evolve through various life cycles, its leaders and employees must be able to successfully support organizational changes so that they can evolve as well because organizations ” need continuity, but it must also develop an aptitude for

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