Nestle Essay

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Nestle Case Study : 1. Did Nestle undergo either first-order and/or second-order change according to the case? Answer listing examples of types of change from the above story. The Nestle company undergo both first-order and second-order change. The first-order changes: - In the 1900’s Nestle changed its approach to global expansion and began purchasing local subsidiaries in foreign markets. This changed maintained the companies’ goals and organizational purpose. - During the First World War, this had increased the demand on diary product, Nestle took this opportunity to expand in the U.S. by acquiring several already established factories. - During the Second World War Nestle started to move the executives from the home base of Switzerland to U.S. These moves were part of Nestle commitment to changing the company in order to increase efficiency and productivity. And the second-order changes: - In 1974, Nestle started to diversify its products in order to promote growth. Nestle became a major shareholder of L’Oreal. That was the first of different acquisitions of companies out of the food industry. Nestle then entered in the pharmaceutical market purchasing Alcon Laboratories, and enlarged its position in food market acquiring Carnation. Diversifying the products, Nestle drove away from its initial structure and created different products. 2. Brabeck- Letmathe emphasizes the need for incremental approach to change. Do you agree that this what he has done? Discuss the differences and similarities between his view and your view of what has occurred at Nestle, both historically and in recent times. Actually I agree with Brabeck-Letmathe’s incremental approach to change by restructure. I also agree that change should happen “slow and steady.” If the all changes happen at once instead of over a period of time then there will be no incremental change.
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