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Multi-domestic
International Strategy
Strategy
Country-centred offices
Low High
Local Responsiveness
Nestl Multi-domestic vs Transnational strategy
Advantages Advantages
Disadvantages Disadvantages
- Limited scale of economy, e.g. less - Possibly being stuck in the middle, difficult
demand for market-specific customization to transfer distinctive competencies
- Lack of national control between countries
- Incur higher cost - Issues arising from implementation
complexity
Configuration of activities
- Development of technological and operational tools
For instance, customer-relationship management (CRM) to monitor customers interactions and data
in different locations
In Eastern Europe, Asia and Latin America, it optimizes ingredients and processes
technology to local conditions, e.g. new delivery system (milk road) in China
Standardisation
Increase international standardisation of products and services
- the same process of production activities
- centralized capabilities in R&D
Nescafe (a soluble instant Global Business Excellence: Basic scientific research and
coffee) in Europe, USA a comprehensive state of art tools, e.g. nutrition
information system compass
Nestea (instant lemon tea
and milk tea) in Asia Bring different businesses Improve consumer healthcare
and units together by and weight management
Chocolate powder Nestquik capturing data between
manufacturers and retailers
stylish, ready to use, tastier
Coordination and Control
More
decentralized
structure:
country manager
operates highly
independently
Think Local
Act Local
More flexible
approach:
standardize where
feasible, adapt
where appropriate
Think Global
Act Local
Extended reach & Integrating with other firms Retain certain products
Communication
Acquiring good human Product reformulations
Bridged countries, people, talent, quality equipment of (including salt, sugar, fat
products and services the competitors reduction)
e.g. Global Product Developing attractive
Launching new products
Technology Centre product lines.
with scientifically proven
e.g. integration with nutritional benefits.
Rowntree Mackintosh in
1980, adding KitKat
During the transformation from
multi domestic to transnational
corporation, Nestle operates in
http://www.scoop.it/t/business-case-studies/p/3998550667/2013/03/19/nestle-s-growth-strategy
http://www.ukessays.com/essays/marketing/cross-business-synergies-relation-to-the-nestle-company-
marketing-essay.php
http://www.nestle.com/aboutus/history/nestle-company-history#tab-1948
http://businesscasestudies.co.uk/nestle/responding-to-changing-customer-requirements-the-drive-
towards-wellness/implementing-the-strategy.html#axzz3xfrkGqLG
https://www.nestle.com/asset-library/documents/library/documents/annual_reports/2014-annual-report-
en.pdf
http://www.ukessays.com/essays/marketing/cross-business-synergies-relation-to-the-nestle-company-
marketing-essay.php