Chapter 14 Danone Strategy Implementation International Food And Beverage

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Instructors’ Manual to Accompany Contemporary Strategy Analysis (9th edn. Wiley, 2016)
CHAPTER 14. IMPLEMENTING CORPORATE STRATEGY:
MANAGING THE MULTIBUSINESS FIRM
Introduction
In our analysis of all three dimensions of corporate scopevertical, geographical, and productthe key
strategic issues are exploiting economies from sharing resources and capabilities across different business
units and avoiding transaction costs. However, this focus upon the benefits of extending corporate scope
Class Outline
Chapter 17 is organized around the different means through which the corporate headquarters of the large
multibusiness corporation creates value for its constituent businesses. Here I follow the work of Michael
Goold, Andrew Campbell, and other members of the Ashridge Strategic Management Center and focus
upon three types of mechanisms:
Managing the business portfolio: the processes and tools through which business are added (i.e.
acquired or created), divested, and through which resources are allocated.
For investigating these issues, I find General Electric a highly illuminating case study. General Electric
has been a source of a large proportion of the tools of corporate management developed over the past 100
years. Its two most recent CEOs, Jack Welch and his successor Jeff Immelt, one of the biggest and most
complex firms in the world has shown remarkable agility and flexibility. By studying the leadership of
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Tata Group, India’s biggest business group, a loose-knit holding company involving over 100
separate corporate entities.
Samsung Electronics a diverse yet highly integrated electrical and electronics giant.
Cases
Jeff Immelt and the New General Electric (R. M. Grant, Contemporary Strategy Analysis: Text and Cases,
9th edn., Wiley, 2016)
General Electric has long defied the prevailing wisdom that widely-diversified corporations are a source
of value subtraction rather than value addition. The case describes Jeff Immelt’s 15 years as CEO of
GEone of the most turbulent periods in the company’s history. The case looks beyond the crises that
Danone: Strategy Implementation in an International Food and Beverage Company (Available from the
By 2012, Danone had grown to become one of the world’s largest multinational food companies with four
major business areasfresh dairy products, water, baby nutrition, and medical nutritionand a growing
emphasis on emerging markets. Danone’s growth had been achieved with a strategy and management
system that was very different from its leading rivals’—Nestlé and Kraft Foodsor from other consumer
Jack Welch and the General Electric Management System (Available from the Instructor Companion Site to
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GE’s portfolio of businesses, changing organizational structure and management systems, and transforming the
culture of the corporation. The case considers how, in an era or downsizing, divestment, and refocusing when
most large diversified companies have broken up, GE succeeded in becoming the world’s most valuable
company while maintaining a uniquely broad business scope.
India. Its 96 independent companies spanned seven sectors: information systems and communications,
engineering, materials, services, energy, consumer products, and chemicals. Economic turbulence had put
a break on social and environmental investing for many other companies but renewed Tata Group's
commitment: the Group had recently revised its charitable giving, adopted a group-wide climate change
policy, and separated its mandatory and voluntary initiatives. The case deals with the intricate connections
between the Group's profitability and competitiveness on the one hand and its long-standing tradition of
social responsibility on the other. It explores value creation, leadership, ethics, and sustainable
development on the backdrop of rapid internationalizations and shifting stakeholders' expectations for
corporate social responsibility.
quality products with unique designs and effective brand promotions. In 2004, Samsung surpassed Sony
to earn profits of US$9.4 billion over revenue of US$72 billion. Still, Yun felt that to compete in the
global market, Samsung's products needed to be transformed into brands like that of Apple's iPod or
Sony's Walkman. This case study, while explaining the growth of Samsung Electronics, offers scope to
discuss how a change in leadership and organizational culture helps to enhance a company's
competitiveness.

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