Free Strategic Management Of Innovation Case Study Example

DANONE Case Study

The article is contributed by Deheunynck (2007) in context of protecting corporate independence and perseverance of DANONE in an era of mergers and acquisitions during 2005 – 2008. Deheunynck (2007) was then associated with DANONE as a Senior Vice President of People and Organization Development department and his core responsibilities were organizational development, career management, executive education and training, and development of HR policies and information systems. The author reveals that sustaining uniqueness is the most important aspect to preserve corporate identity and organizational independence. In fact, the uniqueness is an outcome of specialization that leads to competitiveness and generates economic value. Unequivocally, the size of a firm could not secure a firm from any merger or hostile takeover bid; therefore, it is foremost for a corporation to reinvent, revamp and modify internal management and governance systems to maintain and enhance its core specialization and uniqueness. Deheunynck (2007) throws light over the vitality of practical implications of theoretical concepts such as customer orientation, decentralization, change management, adaptability, flexibility, long term performance management and external environmental analysis to enhance organizational corporate reputation and capability to deal with any uncertainties and changing market dynamics in globalized context. The strength and depth of internal systems and structures derive a firm’s ability to cope with any troubling rumors, conflicts and crises.
Deheunynck (2007) highlights that he conducted a research study with Jérôme Tubiana (forecasting director) and Laurent Sacchi (communications director) to evaluate the uniqueness of their management recipe and functioning. The participants were former managers, journalists, shareholders, suppliers and other pertinent personnel that were not DANONE employees. The research findings confirmed that the corporation adopts an unusual business model that stems from its glocalization strategy to focus both on economies of scale and localization principles. For instance, the emphasis is on becoming local brand under the umbrella of a global corporation that offers enormous resources to adapt to local surroundings and reach masses. Another major finding is the provision of greater responsibility, autonomy and accountability to the managers of local business units who could adopt a different strategic fit according on local dynamics and interact with global counterparts to discuss the pros and cons of diversity. This culture enables global business units to facilitate from each other’s experiences and insights that in turn lead to product, process and managerial innovations. Next finding is about the extent of efficiency that results from supply-chain and operations management. Innovation leads to productive efficiency, which simply means that innovation is a prerequisite of competitiveness.
The research also divulged the fact that DANONE primarily focused on result-orientation with a short-term strategy instead of developing long-term strategic fits. For example, the competitors such as Pepsi, Nestle and others were found to be more long-term oriented than DANONE; therefore, it is deemed essential for the FMCG giant to stress on long run results than short term targets and financial performance. In contrast, DANONE was reasonably better than Pepsi, Nestle and local players in terms of differentiation, which is an outcome of innovations taking place at local business units across global territories.

Reference

Deheunynck, P. The Uniqueness of Danone. Ecole.org, November 7, 2007. Web