Strategic Management and Unilever

Topics: Strategic management, Henkel, Globalization Pages: 3 (873 words) Published: December 4, 2013

Emily Romero

Unilever is a multinational corporation with “extensive product offerings in the food, detergent, and personal care business.” Because Unilever is organizing its companies on a decentralized structure, they are falling behind their competitors. In order for Unilever to succeed as a company they must look over their whole business strategy starting from their foundation and working their way through each and every subsidiary. In making minor adjustments for improvement, Unilever might pull through and have a chance of becoming a successful company once again.

Case Problems:
Unilever is facing many problems not only within the company but with competition as well. “Competitors are more successful by building global brands, reducing cost structure, and executing simultaneous product launches in several national markets.” In Unilever’s case, the decentralized structure is working against any efforts of building both global and regional brands. Because of many duplicates in “manufacturing, a lack of scale economies, and a high-cost structure,” they are trailing behind competitors in bringing new products to the market.

One alternative Unilever could take would be to focus more on the products that bring in the most profit. In this case it would be the food products, which account for “60 percent of sales and include strong offerings in margarine, tea, ice cream, frozen foods, and bakery products.” Mainly because not everyone is willing or able to buy name brands or certain detergents, but there will always be a need for food. If they put more of their focus on this they would be able to exceed the already 70 percent of market share in other countries. The only downfall I see in this would be the extra profit that would normally come in from the other two options would decrease. Another alternative Unilever might consider...

References: © alan chapman 1995-2012
Charles Hill. (2011). International Business (9th ed), McGraw Hill. Pg 480-481
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