General Mill Board and Strategic Planning
General Mill board and strategic planning A joint venture is a special type of strategic alliance in which two or more firms join together to create a new business entity that is legally separated and distinct from its parents. General Mills is one of great examples of joint venture in the international market. The case was explaining the company situations that lead General Mills to look out for a partner in establishing a new joint venture with the purpose of gaining easy access in Europe. General Mills has always wanted to be in the international markets; however, their efforts seemed not good enough to make the company become worldwide products. In 1961, General Mills tried to expand its cereal products into Europe, specifically United Kingdom without any success. Then in 1964, the company aimed for worldwide snacks foods, which many acquisitions had been made to gain the market share. Unfortunately, the FTC forbade General Mill, for antitrust reasons, from acquiring any more snack companies in the United States. FTC was the reason for GM to shift its strategic plan from acquisition to joint venture because FTC’s rules hinder the company’s ability to grow its food operation. Nonfood products started coming into the mind of the joint venture teams including 13 discrete industry areas such as toys, fashion, restaurant, travel agencies, furniture… The company needed to narrow down its core business for a more sustainable and profitable operation. As the company kept adding more industry areas into the portfolio, General Mills started to see that foods and restaurant industry actually gave higher growth than projected in late 1960s, when the nonfood diversification began. Therefore, food and restaurant became the core business since others areas like toy and fashion were more volatile and less predictable. All others industries would be classified in specialty retailing. General Mills has been successful in developing restaurants and snacks in