Case Study

Managing internal growth at Nestlé: The story of LC1

12 pages
May 2000
Reference: IMD-3-0840

This case highlights how Nestlé, the world’s largest food company, attempted to deal with managing internal growth. Nestlé’s CEO, Peter Brabeck, emphasized internal growth in early 2000 because he believed that it was a better measure of the company’s competitiveness in the global marketplace. He stressed that internal growth could be achieved by focusing on internally-developed new products and/or renovating existing ones. Brabeck was also convinced that Nestlé’s long-term profitability would hinge on the company’s ability to achieve internal growth targets. LC1, a successful yogurt product launched by Nestlé in 1994, had become a symbol of what could be accomplished by focusing on internal growth. Although it was a challenge, Brabeck hoped to inspire managers at Nestlé to develop more LC1-type products. Key issues in the case are: (1) how to create an environment in which managers think like entrepreneurs, and (2) how to encourage managers to develop and quickly launch innovative products.

Internal Growth, Food
Field Research
© 2000
Available Languages
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