In: Operations Management
Is the Calphalon acquisition a way to enhance Newell's capabilities, or a violation of its strategy? Will the same strategy that worked well in the past work here? The strategy is the cost leadership strategy.
No, I don't think that the acquisition of the Calphalon by Newell is anyhow a violation of its own cost leadership strategy as the company has always used this low cost strategy to earn and stand a $6 Billion Company in the Market. This strategy works in defining the strong influence with the organisation enjoys with the help kf acquisition of the related industries and top brands. With this administrative techniques, effectivity and efficiency is created which reduce the cost to the minimum and using a divisional structure which makes the product and working of the organisation diversified globally.
I believe that the acquisition of Calphalon is a beneficial move for the Newell as it enabled the entry of the firm into a non mass merchandise market. By this, a large amount of products are now can be sold with a brand reputation. By using the strategic forces of specialisation and and skilled forces, training is provided to make the working of the organisation more effective and efficient. This acquisition also resulted in reduce the administrative, selling expenses and general expenses of the organisation by 25% which thus is a strategic move under the cost based strategy of the organisation to achieve the sustainability.