Company Analysis of Nestle Corporation

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A situational audit is a comprehensive analysis of an organization’s current state in comparison to its micro and macro economic environment. According to Cherniss and Adler (2000, p. 97), a situational audit helps to establish the organization’s current situation in relation to its marketing objectives. In addition, a situation analysis identifies the future economic performance of the organization if it continues to use its current strategies. Nestle foods has operations in more than eighty countries globally. The organizations expansion strategy is implemented through joint venture and acquisitions. This report presents a situational audit for Nestle Foods, one of the world’s largest organizations. It explores the external, competitive, and internal market factors influencing the organization performance. Finally, it provides an analysis of the suitability of the marketing strategy used by the corporation and provides appropriate recommendations.The Internal environmentAccording to Remenyi, Money and Bannister (2007, p.128), the internal analysis of an organization helps to identify the organization’s strengths, weaknesses, opportunities, and threats. The strengths represent the competencies and resources within the organization, which help it to achieve a competitive position in the industry. Nestle foods has numerous strengths which have helped the organization to become one of the worlds largest corporations…. Management of the organization has excelled in creating an environment, which foster innovation in the company. Innovation has helped the organization to achieve internal growth through the ability to meet and surpass consumer expectations. Nestle Foods has uses a low cost strategy which helps the organization to maintain low cost for all operations. Through the low cost strategy, Nestle Foods is able to offer its consumers competitive prices for its products. In addition, Nestle foods have a highly competitive team of research and development in charge of new product development. Nestle Foods has affiliations with major learning institutions and has developed a university where most of its research and development is conducted. The research and development team has enabled Nestle Foods to differentiate its products from those of its competitors in the industry. Another strength that Nestle Foods has its health based weight-management product line. With the growing popularity of health foods in the European market and other countries, this presents a lucrative opportunity for Nestle Foods. According to Remenyi, Money and Bannister (2007, p.128), threats are factors in the business environment which may hinder the successful implementation of an organization strategies. Nestle Foods has undertaken an intensive expansion strategy by venturing in many markets in Europe and other continents. However, most markets in Europe are already saturated which may hinder the successful implementation of the Nestle Food’s expansion strategy in European markets. For example, when Nestle Foods launched its yoghurt, Yoplait, in France, it failed to acquire a large market share because Danone is the established brand of yoghurt in the country. Nestle