Strategic Audit For Nestle

Strategic Audit For approachThis paper focuses on the Nestls strategic audit. It views the different business strategies adoptive by nuzzle in its business. It starts with defining the modern position of the comp any(prenominal) Nestle and carries on with its strategic audit. The paper views different financial facts and figures of the company Nestle in order to strengthen its strategic audit. The paper in order to analyze its internal and external environment carries out different analysis wish well SFAS (Strategic Factor Analysis Strategy), IFAS ( interior(a) Factor Analysis Strategy) and EFAS (External Factor Analysis Strategy).A PESTEL analysis of the environment in which it breathes is carried out to help find out the strategic alternatives that privy be applied by the Nestle. supercharge the paper has come out with the implementation and correspond mese ars to help out the company.Strategic Audit for NestleNestle a Switzerland based organization is leading the world mark et in food, health and nutrition industry. It all started in 1867 when Henri Nestle made a draw product for an infant to save his life. From there it had unveiled a vast potential in the foods and beverages industry. Today it manufactures and sales a variety of products under its ceiling with the assistance of different subsidiaries located in the different countries of the world.Current Position of NestleOver the years the company has expanded its operations along with the attach in its variety of products. Today it offers products from various segments like dairy, food for babies, chocolates and ice creams, confectionery, water and foods, beverages and many more. It has been instrumental with its strategies of product innovation and modification.One of the important current landmarks of Nestle was in the year 2007 when it has acquired three major companies one by one started from Novartis (a health pity company), Gerber (Baby food ) and Swiss Water Company, Henniez. These acqu isitions gave a young definition to Nestls health cargon, baby food care division. Nestle is guided by the principles and values and hence always try to build its pick up and products around those to earn a long and uninterrupted association with its stakeholders. It enjoys long term gains that are being created with its commitments and values.Nestle has been on the forefront in wise(p) when customers are in need of which product and accordingly shifts its focus on them. Currently it has been focusing on its core business activity of nutrition segment. Further it has made and customized its products to suit to the needs of different geographical locations and culture. It enjoys a healthy competition in its business with different companies in different areas like in USA it has to deal with Dannon and other competitors. (About Nestle, 2009)Financial PositionNestle has a sales of 52.3 billions CHF (Swiss Currency) for the first two quarters of 2009 with a profit of 5.2 billion CHF approx. Its operate cash flow is around 6.4billon CHF which is up by 3 billions CHF from the first 2 quarters of 2008.Its net profit margin is 9.7% of sales. (Investors relations, 2009)Internal EnvironmentInternal Environment of the company croupe be analyzed by SWOT analysis. The two components of SWOT analysis i.e. strengths and weakness are internal to the organization and therefore can be studied to know its internal environment.StrengthsNestle has discovered many strengths in its sight that makes it internally very strong. Some of its major strengths areIt is the leader among the food, health and nutrition industry in the world market.It is operating in different companies through different subsidiaries.It has an extended product line that offers a variety of products.It is a low address operator.It has an excellent research and discipline team.WeaknessesIt sometimes unable to make people understand that its products are food non drugs.Some of its products are not known by the market.Its marketing approach is not quit well.(SWOT Analysis of Nestle,2009)External EnvironmentExternal environment of any business is characterized by the opportunities and threats that are around it. Thus it needs to take care of its external environment in order to grasp the potential opportunities and to stir out with its threats.OpportunitiesIts health care segment has huge potentials to grow as people are now a days getting health conscious.It can still move into the markets that possess huge potentials.ThreatsIt is entering into the markets that are already matured.It has to face intense competition in many regions with the national companies. .(SWOT Analysis of Nestle,2009)environmental FactorsPolitical FactorsDifferent countries food habits are different and their political environment is different thus companies has to face it.The government is becoming more attentive with the boilersuit food, beverages and health industry and thus the company has to look in it.T echnological FactorsThere is need to bring the latest technology to keep the food and beverages hygiene. It give increase the cost of the company.In this era technological cost to manufacture the food, its packaging and storage will require the latest technology that will cost more.Socio-cultural FactorsPeople now days are getting health conscious thus there will be a need of health care products.Lifestyle of the people are changing thus they are in need of packaged food.Legal FactorsThe safety measures in food and beverages industry are tightening so as to keep the safety and quality in its products.International standards for food and drugs industries are making the standards and norms tougher while keeping in perspicacity the health and hygiene factors.Strategic Alternatives and Recommended scheme for NestleToday organizations have to strive more in order to gain something and to make a bit in this competitive environment. Following are some strategic alternatives for NestleR enovation and Innovation StrategyAdvantagesThis dodge will help the organization in continuously upgrading its existing products to the new ones.This strategy will help it to fight todays competition.DisadvantagesThis strategy demands a lot of efforts and cost in continuously upgrading the products and technology.It can switch off its product life cycle.Growth StrategyAdvantagesThis strategy will help the organization in approaching the new markets and help it to gain market share.DisadvantagesThis strategy can result in company loosing focus from the markets in which it is operating.Recommended Strategy for NestleFrom the alternatives the strategy that Nestle should focus is the renovation innovation strategy. As through this it can bring in new light and more improved quality in its products. To support this strategy Nestle has an excellent research and development team. In todays market that is driven by technology the company will gain a substantial advantage through this stra tegy.ImplementationTo implement the renovation innovation strategy, the company needs a strong support from all its departments especially from the research and development department. Further the company has to focus that they should implement it on a regular basis. They should keep in mind that they should not overdo it. Thus if the commitment and needs of its different customers followed and applied through this innovation strategy it will sure bring returns to the company.Evaluation and ControlOnly implementation of the strategy is not enough, if organization wants to keep itself growing it has to continuously monitor and control the strategy. The drawbacks that are found in the strategy should be eliminated to improve the overall process. Further to bring more life in the strategy it needs a control mechanism to follow. Evaluation and Control is the essence of successful strategic implementation Thus Company will enhance and grow more with the efficient evaluation and control of the strategy.