How does the corporate office contribute towards Newel’s performance or in other words what value does the corporate office add?
•Newell had adopted to develop its product line through key acquisitions rather than internal growth. All acquisitions are taken care at the corporate level so that the divisions are not diverted from their core function of generating profit.
•Potential target firms undergo an intense screening process. They have to be par with company’s existing performance criteria
•They bring up acquired companies by developing them to become cost efficient through operational strategies and creating profits within a period of 18 months. Some are done with a period of 6 months of time. Newell also have strict control for the time the customers pay, this is within 30-45 days
•Corporate tightly controls the finances, yet it allows brand and division president autonomy to guide the performance of the business.
•Corporate office does a good job of seamless linking of its structure, system & processes (SSP) with its businesses and resources.
•The company attaches great importance to customer relations frequently inviting buyers for plant visits.
•The companies Newell acquires have potential but undervalued. These companies are suffering because they do not have major clients and there overhead costs are high.
•Newell focused on good communication within the company and had numerous meetings throughout the year in order for leadership roles to remain informed about other aspects of the company. Division leaders convened several times a year for presidents’ meetings as well as the ability for regular encounters at trade shows throughout the year.
•Other forms of communication were bracket meetings and the monthly collection of operating figures. Bracket meetings were implemented if there were too many variances within the budget.