A REPORT Essay Example | Topics and Well Written Essays - 2500 words

A REPORT - Essay Example he present study discusses about the multinational firm and FMCG giant Nestle which has been among the pioneers in its product category and has a large number of Billion dollar worth brands under its umbrella. The present study would discuss the strategies that have been adopted by the firm to maintain its profitability in the industry. The study would also analyse the cross business strategies that have been employed at the firm. According to Knoll, Synergy is defined as â€Å"the effect that the combined return of the whole is greater than the sum of the returns from the individual parts†. In corporate world cross business synergy is achieved when the net returns of the combined entity formed by aggregating the different departments and units exceeds the net returns that is generated by a single entity taken as a standalone unit within the organization (Knoll, p.14, 18). The most important strategy of Nestle with regards to corporate synergy was its strategy of integrating the different departments across the organization. This strategy was named as GLOBE (Global Business Excellence) in which the different departments and the suppliers were brought together on a single common platform. This enabled real time information sharing among the different departments as well as the stakeholders that helped in generating greater efficiencies which has resulted in competitive advantage for the firm. All the 23 Research and development (popularly referred as Product Technology Centres) centres of the world were brought together on a single common platform which helped in generating greater innovations in the product line of the firm. The top management of the firm was of the strong belief that in order to sustain profitability the firm needed to continuously innovate its products line and would have to expand much beyond their borders considering the fact that Switzerland offered little potential of being a good market for the firm in terms of market size. Under their