Nestle Breakfast Cereal (A & B)

Description

General Mills and Nestle were meeting to discuss the possibility of cooperation between the two companies in the breakfast cereal business. Executives from General Mills were arriving in a week's time and an executive vice-president at Nestle was charged with preparing a briefing on General Mills before their arrival. The executive vice-president had recently decided that Nestle should consider taking a partner in the breakfast cereal business and had collected some information on General Mills. The joint venture was of interest to Nestle because its European breakfast cereal business had been performing poorly. General Mills was interested because it has no significant breakfast cereal business outside of the United States. However, the fundamental issue was why Nestle had not made a success of the business in Europe, and what changes the company would need to make for the business to be a success. The balance between global strategy and local operations is central to this case.

Learning Objective

To introduce the "global versus local" management issue. The case situation is quite easy to understand, making it a good introductory vehicle, and the product is one with which everyone is familiar.

Keywords

Decentralization European market Joint ventures