Chiquita's global turnaround: analysis and strategic implications

Chiquita

The case study of Chiquita, "Chiquita's Global Turnaround" shows how a company faces challenges to brand management and business strategies in the face of globalization. Chiquita's need to rebrand itself from the United Fruit Company's nefarious past is an emblem of where the company is headed. Entering new markets presents significant barriers and opportunities. However, transforming a brand image and identity proves to be even more difficult, especially as the company attempts to balance the pretense of social responsibility with profitability.

When Chiquita first started to do business in Central America, the company retained a strong corporate culture that did not adapt to local conditions. The lack of support for labor unions, and gross mismanagement of the local farming communities made Chiquita a target for political activists both in the nations in which bananas were grown and in consumer countries. Chiquita's "global turnaround" represents a difficult and perhaps halfhearted attempt to rectify the past and clean up the brand, while still pleasing shareholders in the corporation.

A current of ethnocentrism and imperialist mentality prevented Chiquita from recognizing the opportunities inherent in expanding its organizational culture and human resources strategies. This point-of-view could not be maintained for long, as the local stakeholders placed increasing pressure on Chiquita to respond to their needs. The same was true with Chiquita's approach to human resources management. Instead of adapting to local customs, cultures, and needs, the senior management retained a strict organizational hierarchy and a top-down managerial strategy. Not only did consumers not cultivate brand loyalty, but employees also did not feel loyal to the company. Chiquita therefore experimented with methods of changing their approaches to brand management and human resources. These methods had to be evaluated from a cost-benefits analysis perspective.

Chiquita occupies a unique niche in the supply chain, and depends on local farms to cooperate as suppliers. The company has traditionally depended on tight political and economic relationships not only with local suppliers and other members of the supply chain but also politicians. A relationship with politicians has been necessary for Chiquita to maintain its hegemony in the communities in which it does business. The regulatory environment, whether related to farming subsidies and practices or to operational costs, is critical to Chiquita's success. Because Chiquita developed a profit-driven mentality that had no ethical underpinning, its brand lost a significant amount of credibility. Bad publicity hurt the company significantly enough that change was necessary. Change has been slow and sporadic, but meaningful nonetheless.