The paper "Challenges in International Management - Nestle" is a great example of a business case study. Nestle is the world’ s largest food and nutrition company with subsidiary companies in several countries across the world. The company was founded in 1905 following the merger of Anglo-Swiss Milk Company and Farine Lactee Henry Nestle, which were until then fierce competitors in the food and nutrition industry (Nestle Company, 2012). Nestle is headquartered in Vevey, Switzerland and the merger became a stepping-stone for the company’ s internationalization program. By 1910, Nestle was operating profitable factories in Spain, United States, Germany and Britain.
Both the first and second world wars had a lot of impact on Nestle international growth and profitability. The wars helped with the introduction of new products and production plants in many countries across Latin America, Eastern Europe and Asia (Czinkota, Ilkka & Moffett, 2008). In 1974, Nestlé ’ s management reached a decision to diversify the range of products outside the food industry. Subsequently, the company started to buy stakes in cosmetics and medical companies. Today, Nestle is one of the global leaders in the food industry and has more than 470 factories across the world.
Nestlé ’ s success in international business is attributed to the company’ s strong sense of efficiency and strategic formulation of business objectives (Nestle Company, 2012). According to the information obtained from the company’ s mission statement, Nestle is committed to the following business principles in its internationalization program: The company’ s objective is to manufacture, distribute and market the products in such a way as to create value that can be sustained for the local communities, employees, shareholders, consumers and business partners. The company does not strive to gain short term profits at the expense of successful long-term development plans. Nestle recognizes that customers at the international market community are influenced by the company’ s behaviours, beliefs and actions and, therefore, it has to act in a manner that best satisfies the interests of the customers. The company holds the conviction that observation of local laws, rules and regulations is key to successful entry into the global market.
The company maintains a steadfast commitment to follow and respect all applicable laws in the countries where it operates. The company is conscious that success in the international business market is a product of professionalism, conduct and responsible attitude of employees.
As such, the company recruits highly knowledgeable and skilled workers and offers routine training and development programs to its employees. By adhering to the above strategic principles, Nestle has managed to build a brand with a global presence. The company has invested huge sums of money in research and development programs as well as the development of knowledge management system, all of which have been fruitful. As of 2010, the company had over 265, 000 employees and 470 factory locations in about 90 countries (Nestle Company, 2012).
This reinforces the view that the packaged food giant is indeed a multinational company. Nestle has employed efficient and highly effective supply chain management systems to coordinate activities between suppliers, production plants and factory. The company has a centralized human resource management system for responding to the needs of its human capital. All these strategic initiatives have enabled the company to shine in the international business arena (Czinkota, Ilkka & Moffett, 2008).
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