Real-world companies Essay Example | Topics and Well Written Essays - 1500 words

Real-world companies - Essay Example Geographical barriers trade and tariff rules are great threat for it. Maintaining the brand image is also a big threat for Nestle (Nash, 2000). PEST Analysis Political: Political factors can mold the business in a great extent. Due to which Nestle may bear different taxes which increase the operational cost of Nestle. Economical: Economical factors like inflation have a great encroachment over the Nestle business. Socia-cultural: People have more awareness about brand due to cultural factors so it is costly to maintain the social symbol. Technology: Rapid change in technology is a great threat for Nestle to maintain its innovation and enhance the R&D operations (Peter and Olson, 2004). Porter’s 5 forces Model The threat of substitute: Substitute low price products are the biggest threat for the company while Nestle is providing its customers with quality products at a reasonable price. The threat of new entry: Low entry barriers are there. Entry of any new firm having same sta ndard products can be a great threat for Nestle. Competitive rivalry: There is high competitive rivalry because Nestle is competing with other organizations which offer the same products at low cost. The bargaining power of supplier: Due Supplier of Nestle have increased bargaining power. The bargaining power of buyers: New entrants and their offers have increased the bargaining power of buyers (Nash, 2000). Competitive advantages of Nestle: Nestle Company started off as the single idea from Henri Nestle who was a pharmacist. He formulated a mil formula for infants who had less tolerance for mother milk in 1866. This was the breakthrough for him as the entire Europe came up with the largest demand for this formula. Since then Nestle has been increasing the size the company and expanding in almost all countries. Not only business expansion but Nestle also has expanded the product line by introducing variety in every product they offer (Etzel, et. al., 2004). By using the innovation a nd renovation in the product line, Nestle has been able to gain competitive advantage in the global market. Nestle’s trademark has become a barrier to many other companies with people considering its products as a benchmark to follow. Here are some of the competitive advantages that Nestle is enjoying at the moment: Nestle is leading the overall global market position. It is either number one or two brands in most of the countries and regions globally. The larger scope of Nestle’s extraordinary business is providing significant and sustainable economies of scale in marketing, manufacturing and administration processes of the business. Nestle has developed a wide research and development department with capabilities and expertise that allow the company to lead in the innovative products which ultimately leads to flexibility in portfolio maximization and profitability (Etzel, et. al., 2004). Business strategies used by Nestle: Innovation: Innovation is one of the key bus iness strategies that is bringing a sustained competitive advantage to Nestle. A great deal of applied and pure science research is part of R&D centers of Nestle in order to bring innovation but consumer benefit remains at the core of the business. Whatever designed or produced is customer oriented. The Nestle’s innovative strategy focuses on providing: Health and nutrition Quality and safety of every Nestle products

Role of Vision at Mentor Graphics Research Paper

Role of Vision at Mentor Graphics - Research Paper Example Mentor Graphics in its quest to keep up lost its direction and ended up struggling to stay afloat. In the process Mentor Graphics lost sight of what it had set out to achieve. Vision is being used as a competitive mantra to beat their opponents. This was a reactionary measure when a new entrant came into the scene. In changing its vision because of competition, Mentor Graphics was focusing on its short term goals and in essence abandoning its long-term goals. Instead of using vision as an agent would strategically bring about change, Mentor Graphics used change as an architect of its vision. This is simply catastrophic at the very least and non-strategic. Another way vision is used is to capture the attention of its customer. Gerard Langeler and his team change their vision to make it more appealing to them. Again this is a deviation from its set objectives. Mentor Graphics even goes as far as basing their vision on the key pillars of their business based on stock performance. This random uncalculated move sank them into a quagmire situation when one of their key pillars does not yield profits. Again this is a reactionary move necessitated by the need to fix a short-term goal (Gratton, 2004). The vicious cycle of randomly conceived visions serves only to cast the company further away from their goals. The changes made to the vision of Mentor Graphics only favored it in the short term. Whilst its sales may have gone up in the short run, in the long run it distanced the company from its set out objectives hence business kept declining (Gratton,2004) .Thus the continuous changes made to the vision only worked to weaken and hurt the company in its long term goals. The main reason why vision failed miserably at Mentor Graphics was lack of a well-conceived strategy from the start. The company failed in strategically planning its course of action in the future. Their inconsistence in the criteria they used to come up with vision statements had long-term