Nestlé Case Study

Nestlé Case Study

Stephen W. Pore

BUS 661- Leading Organizational Change

Professor Erick Aguilar

February 4, 2013

Organizational change occurs when a company creates a reformation from its existing position to preferred anticipated potential position. Companies like Nestlé’s applied changes for the expansion of the organization future growth. Nestle performed their changes not on to gin profit but also to adventure into other potential demand of other markets. In this paper, several questions related to the Nestlé’s case study will be analyzed regarding the reason for the changes fostered by Nestle for the future of the organization experimenting and continuous marketing restructuring.

Managing organizational change is the process of planning and implementing change in organizations in such a way as to reduce employee resistance and expense to the organization. In the Nestlé case study, the organization experienced changes for the continuous developing of the organizations future. Many of the changes within Nestlé’s organization were not from the needed perspective but for the future expansions. Nestlé Company experienced both the first-order and the second-order changes. According to Palmer et al, first-order, incremental changes maintain and develop the organization; they are changes designed almost paradoxically, to support organizational continuity and order; second-order, discontinuous change is transformational, radical and fundamentally alters the organization at its core (2009).

In the first-order Nestle began expanding globally and begun to purchase local subsidiaries in local markets, performed an offshore relocation of management from its home base in Switzerland to the United States and strengthened the control of its Information Technology department. During WWI, Nestlé next strategic change occurred to the increase demand in dairy products. In the second order change strategy Nestlé presented the diversification of market through entering other markets, such as cosmetics and pharmaceutical, overhauled and replaced the existing executive board and venturing with other acquisition and mergers. With these acquisitions of changes the fundamental product line of Nestlé Company beginnings was reformed. Due to the choices made by Nestlé is still dealing with the consequences of the corporation the company shareholders believed that Nestlé over extended the financial responsibility with these acquisitions and caused the debts that came with it.

In various years the focus of the management of Nestlé’s was to continue the inclination of the company’s financial improvement through divestitures and continuous of strategic acquisitions. According to