How Globalisation Drives Business Success: A Nestle Case Study

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Research Project
“How Globalisation can drive Business Success?- A Case Study of Nestle”
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Abstract
The study fundamentally discusses about the success of the company Nestle, which has
grown immensely over time mainly due to liberation of trade, movement of goods and
services and capital. Currently, the company Nestle holds the dominating position in the
entire world in the food and drinks industry. The report sheds attention on elaborating about
the impact of globalisation on large organisations as well as discussing about the associated
risks that were overcome. Along with this, the researcher has framed several objectives that
were used as guiding principles to prepare the study. The researcher has illustrated about the
different methods and techniques that were used for collecting information and data. The
most important part of the study is where the researcher conducted survey with 100
employees of Nestle and interview with 2 managers. This helped him to collect genuine data
and information so that meaningful conclusions could be gathered and framed in the study.
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Table of Contents
Chapter 1: Introduction..............................................................................................................5
1.1 Research aim....................................................................................................................5
1.2 Research objectives..........................................................................................................5
1.3 Research questions...........................................................................................................5
1.4 Research rationale............................................................................................................5
1.5 Significance of the study..................................................................................................6
1.6 Research Framework........................................................................................................7
Chapter 2: Literature review......................................................................................................8
2.1 Introduction to Globalisation...........................................................................................8
2.1 Effect of globalization on the economy...........................................................................9
2.2 Expansion of organizations............................................................................................10
2.3 Reduction of marketing costs and the creation of new opportunities............................10
2.4 Effect of globalization on business performance...........................................................11
2.5 Literature gap.................................................................................................................12
2.6 Conceptual Framework..................................................................................................12
Chapter 3: Research Methodology...........................................................................................14
3.0 Introduction....................................................................................................................14
3.1 Research Methods and techniques.................................................................................14
3.1.1 Justification of the philosophy and approach used.....................................................15
3.2 Research Instruments.....................................................................................................16
3.3 Sampling........................................................................................................................16
3.4 Ethical Issues..................................................................................................................17
3.5 Data Analysis and Interpretation....................................................................................17
Conclusion............................................................................................................................17
Chapter 4: Data analysis and Interpretation.............................................................................18
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4.0 Introduction....................................................................................................................18
4.1 Analysis research findings and Data, applying appropriate analytical tools.................18
4.2 Present the research finding logically and coherently to audience, identified
stakeholders, demonstrate and align with research objectives.............................................27
4.3 Critically analyse the findings and make valid justify recommendations......................28
4.4 Discuss merits, limitations and pitfalls of approaches to data collection and analysis..28
Chapter 5: Conclusion and recommendation...........................................................................29
5.0Reflect on the effectiveness of research method aligning it with objectives of 188.......29
5.0.1 Linking with objective 1.............................................................................................29
5.0.3 Linking with objective 3.............................................................................................29
5.1Consider alternative research methodologies and lessons learnt in view of the
outcomes..............................................................................................................................29
5.2Provide critical reflection and insight that results in recommended actions for
improvements and future research considerations...............................................................30
5.3Demonstrate reflection and engagement in the resource process leading to
recommended actions for future improvement....................................................................30
Reference list............................................................................................................................31
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Chapter 1: Introduction
1.1 Research aim
The primary aim of the study is to shed light on the rise of globalisation and its growing
impact on the success of business of Nestle.
1.2 Research objectives
The fundamental research objectives of the study are:
 To illustrate in-depth knowledge and understanding about the globalisation
 To analyse the influence of globalisation on the success of the company Nestle
 To provide recommendations for overcoming barriers and challenges due to
globalisation
1.3 Research questions
The research questions of the study are:
 Describe in-depth knowledge and understanding about the globalisation?
 What has been the influence of globalisation on the success of the company Nestle?
 What are the recommendations for overcoming barriers and challenges due to
globalisation?
1.4 Research rationale
What is the issue?
In the conquest to become the leading food and drinks Company in the world, the senior
management of the company Nestle has implemented several expansion and growth
strategies to establish its presence in different countries. However, these rapid expansion
strategies have consumed huge capital and other resources of the company, as well as
diversified the attention from the core business to several other aspects. Currently, the
company is struggling in many countries to sustain their business and achieve high growth
prospects.
Why is the issue?
The international markets have witnessed high increment in competition leading to shrinkage
in market share as well as considerable reduction in profits. Another impact of globalisation
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has been towards the growth of small and medium sized enterprises, which is the major
reason that is influencing the growth of large corporations.
What is the issue now?
Currently, the major issue for the senior management of the company is the fact that it will be
highly difficult for them to sustain their business, while struggling with the above mentioned
issues. Therefore, it is necessary for them to overcome the present scenario to build a strong
empire.
How will the study shed light on this issue?
The study illustrates facts and information about the company Nestle, as well as, in-depth
understanding about the methods adopted by the company that helped it to gain high
advantage in the global markets. The direct impact of the globalisation has had on the
business activities of the organisation.
1.5 Significance of the study
The study intends to shed light on the success story of nestle, which can be beneficial for
other companies to gather crucial information and understanding for propelling their business
activities and business value. Through, the findings and analysis of this study, the companies
can collect important concepts and key message that can help wide scale businesses to drive
their revenue and achieve market leadership. Along with this, the study will serve as a
facilitator for management of different companies to learn and practice similar methods that
helped the food and drinks company, Nestle to achieve global leadership.
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1.6 Research Framework
Figure 1: Research Framework
(Source: Created by the Learner)
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Chapter 2: Literature review
Globalization has boosted economic growth and has created new employment opportunities.
It has raised the income of people and created new employment opportunities. In this chapter,
information has been collected from secondary sources and the impact of globalization on
business has been described.
2.1 Introduction to Globalisation
In the past few decades, there have been huge changes taking place around the world, which
has sparked change in activities and the process of conducting business. Rapid changes in the
political framework of different countries, economic activities and business procedures, and,
along with this, the development in communication, transport and technology has pushed the
firms and corporations to adapt to these changes by introducing corresponding change in their
strategies as well as adopt methods to move out of their boundaries and explore new markets
and regions (Purnell, 2018). This marked the rise of globalisation, where companies try to
enter or explore new markets, with higher demand of products and services. Major factors
that led to this change are considered to be the increasing competitive pressure, limited
market growth and need for cheap labour and resources. These factors and changes in the
surrounding environment of business caused business leaders to move from traditional
methods to alternative processes for building a successful company. In the current era, the
word globalisation has become a popular word, as it is considered to be a prerequisite for
long-term success of a company (Du Plessis et al., 2018).
The word globalisation has evoked different meanings and opinions worldwide; however, it
can be explained as the process of integration of different economies around the world, by the
increase in movement of products and services and capital. In some cases, it is also
considered as the movement of knowledge and labour across the international boundaries
(Kim et al., 2018). Cultural factors, political factors and environmental factors are the basic
dimensions influencing the globalisation. Globalisation has revealed the fact that information,
knowledge and opportunity are decentralised and shared across the world. The major factor
due to which companies and large corporations have widely accepted this trend is that
expansion of marketplace opens more venues for growth in utilisation of resources and
favourable opportunities (Kothari, and Lunkad, 2018). The direct impact of these factors and
changes in the business environment is that it has spurred increase in labour competitiveness
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and enhanced production efficiency. It also leads to higher development of markets and
economic gains for developed and developing nations (Stemmler, 2018). With the wide
spread effect of globalisation, the world is getting smaller and smaller and more global every
day. Information is being transferred at greater speeds and lower costs, highly beneficial for
companies to coordinate and work smoothly. Another impact observed due to increase in
global activities is the collaboration among countries, multinational companies and
companies (Lund, and Manyika, 2016).
In the present era of globalised economies, markets are increasingly becoming more
competitive and international; however, the impact has been different for small and medium
enterprises and large corporations (Castellani et al., 2018). Large corporations have gained
more due to the globalisation. For instance, the company, Nestle was founded in Switzerland
in 1866, however, it expanded to several new countries by the end of 20th century. Currently,
there is any country around the world, where the products of the company are not sold.
However, the extensive utilisation of strategies by the senior management of the company, to
explore new markets and emerging countries have caused both positive and negative impacts
on the overall productivity and performance of the company.
2.1 Effect of globalization on the economy
Globalization has increased the participation of companies or businesses in global markets.
As per the economic aspect, globalization has two main elements namely, globalization of
markets and globalization of production. Globalization of markets is the process of the
collaboration of different nationalized markets into a single huge international market. The
change in tastes and preferences of consumers worldwide has led to the creation of the
international market. The resemblance in the tastes and preferences of consumers on the
international level has led to the emergence of global markets, in other terms, globalization.
This has resulted in the production of standardized products by the organization, which is the
actual reason behind globalization (Katerina and Aneta, 2014). The other element is the
globalisation of production, which is the inclination of businesses to figure out the vendors of
goods and services based in locations across the world. The motto behind this is to find out
the differences in the prices and the attributes of the services in different countries that affect
the cost of production. Globalization has become inevitable for the organizations due to the
cutthroat competition and the expansion of the organizations. Globalization has changed the
ways in which the organizations used to plan and strategize before. The income or the profit
generated by the organization have increased through globalization and has streamlined the
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level of income for the organizations that sell seasonal products. The inflow of profits has
boosted as it has led the organizations to increase its sales.
2.2 Expansion of organizations
Globalization has resulted in the incorporation of countrywide economies, which has led to
the expansion of international markets. Globalization has led the organizations to expand and
has aided the organizations to generate more profits. It assists the organizations to produce
foreign exchange for the firms that are located in foreign locations. The influence of
globalization is immense in every field and aspect. It has proved advantageous for the
organizations in terms of training the staffs, providing financial support, advertisement and
promotion. It has also helped in reviving the organizations that are about to collapse and in
having a competitive edge over other organizations. Information technology has boosted
globalization as the advent of information technology has enhanced the process of production
and has changed the process of designing, producing, distributing and the sales of products
and services (Okoye and Nwaigwe, 2015). These strategies have led to the expansion of the
organizations as the management and administration of the organizations have become easier
by the advent of information technology and has changed the way of operation of the
organizations. The exchange of information has been facilitated through information
technology as well as communication or conversation has become easier, faster and cheaper.
It has led to innovation as well which has assisted the organization to grow and develop.
Organizations like Apple, Coca-Cola, Starbucks, etc have expanded and developed through
globalization. These organizations have conquered the market all around the world and have
become a brand name in the world.
2.3 Reduction of marketing costs and the creation of new opportunities
Globalization has changed the overall operation and administration of the organizations.
Since the tastes and preferences of the consumers worldwide have become common up to
certain extent globalization has emerged. The preferences of the buyers in the markets all
around the globe have led to the globalization of markets. The organizations that offer its
products globally can trim down the costs by setting standards for marketing activities. The
products of the companies which are produced in a particular country but have attributes that
are preferred globally can be marketed and sold in other countries as well by changing the
design of packaging of the product in different languages. The cost of promotion and
advertisements can further be reduced by making TV advertisements and dubbing them in
different languages (Liang et al., 2015). The visual element is kept the same in the
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advertisements and the print of the ads is translated in various languages. Globalization aids
the creation of new opportunities in marketing as it assists the organizations to sell their
products abroad in case the domestic market becomes saturated. This is helpful even in cases
when the domestic market is small, for example, there is cutthroat completion between
Google and Yahoo since China has the capacity for e-business that supports more than 400
million users of Internet, but only thirty percent of Chinese population surf internet while
more than seventy percent of US population surfs internet.
2.4 Effect of globalization on business performance
Globalization has affected the performance of organizations, that is, both financial and
operational performance. By financial performance, it is meant that globalization has affected
the growth of sales and profit of the organization. The operational performance of the
organizations is affected as the share in the market, innovation, quality of the product, and the
effectiveness of marketing is enhanced through globalization (Law et al., 2015). It has paved
for the organizations to expand and generate more profit as it has enabled the organizations to
spread its branches all over the world. This has affected the operation of the organizations in
a positive way and aided the organization to deal with the customers in an effective way
while increasing the satisfaction gained by the organizations.
A few questions to reflect on:
What is known about my subject?
The subject globalisation is a highly discussed topic and many new revelations have been
made about it. Analysts and researchers have forecasted that the current trend of globalisation
will pick up more speed in coming future.
What is the chronology of the development of knowledge about my subject?
Globalisation was known to humans from very early stage of human civilisation; however the
term became popular in the late 19th century. Since then the science and learning about the
subject has vastly increased.
Are there any gaps in knowledge of my subject? Which openings for research have been
identified by other researchers? How do I intend to bridge the gaps?
Yes, there are few gaps in the subject. Certain aspects about the globalisation related to its
implications on various departments of the organisation have been more elaborately
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discussed by other researchers. In order to bridge the gap, an overall perspective has been
used to touch upon the details associated to it.
What concepts, models, theories, and frameworks can I find regarding my research?
Several theories and models are known that can help in the research, including, theory of
liberalism, theory of political realism and theory of network society can be used.
Is there a consensus on relevant issues? Or is there significant debate on issues? What
are the various positions?
No, there is no such consensus on relevant issues. There have been several debates conducted
on the issues about globalisation.
What is the most fruitful direction I can see for my research as a result of my literature
review? What directions are indicated by the work of other researchers?
The most fruitful direction that can be seen is that globalisation has already changed the
landscape of conducting business around the world, helped the emerging markets to become
developed counties and witness high growth prospects. Other researchers present the idea that
barriers that were slowing down the pace of globalisation will resolve in future, assisting in
the development of more integrated markets.
2.5 Literature gap
The literature review elaborates the impact of globalization on business organizations in
general but the exact impact of globalization on the organization Nestle has not been
highlighted. Though globalization positively affects the business organizations in their
growth and expansion, however, there are certain negative effects as well which has not been
covered in the literature review. The data so collected do not specify the effect of
globalization on the specified organization, Nestle but has specified the effect of
globalization on overall every organization in the world. Hence, the data is not so accurate
and up to date.
2.6 Conceptual Framework
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