Newell Rubbermaid Essay

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To grow in the highly competitive consumer products market, Newell Rubbermaid's strategy has long been one of acquisition. One of the company's strengths has become its ability to quickly integrate new companies into the Newell Rubbermaid business. But with each acquisition, the IT and business teams were left struggling to manage additional independent brands with very divergent sets of technologies. With the emergence of e-business as an increasingly important opportunity for driving down costs and providing better service online, Newell Rubbermaid recognized the importance of finding a new, centralized platform to support their divisions.

it is pretty clear that the company only acquires related businesses that fit the mold of their
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First and foremost, it never loses focus on its goal of keeping a solid reputation with national chains. It is able to deliver on this target thanks to its second strength, its corporate structure. Finally, it possesses technology, in the form of EDI, which is more than adequate for the needs of its retailers.

There are three primary reasons why Newell corporate is able to create value for its business units. During the acquisition process, the corporate office handles every aspect of the deal, so as not to “distract” the divisions from their profit-first missions. This is important since it frees the divisional presidents from worrying about things outside of their control. Once a new business unit is added, Newell corporate is excellent at streamlining that division. The case cites an impressive time of six months to two years for this turnaround. Perhaps even more astoundingly, Newell is still able to bring a new product division into the family despite being a very large company already. Lastly, Newell is extremely diligent when it comes to monitoring the financials of each division. By holding bracket meetings whenever things deviate, even slightly, from the target margin, corporate keeps its divisions scared and in line.

Going back to this idea of Newell effectively managing its divisions, the case emphasizes how the company places “primary importance on profit performance.” A lot of the credit for the success here can be
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