Harvard Business School

The relationship between HBS and Nestlé grew out of an intensive interaction in the late 1950s, when the two institutions collaborated to address their most urgent respective professional-development needs.

HBS in the mid 1950s was still largely a domestic-U.S. enterprise. Most of its students were Americans—trained at American colleges and universities, and aiming for jobs in the domestic economy. The faculty, too, consisted almost entirely of U.S. citizens, whose research and teaching were rooted in U.S. perspectives. Dean Stanley F. Teele was acutely aware of this shortcoming, in an era when U.S. companies were becoming increasingly international—and as the war-devastated economies of Europe began to revive and reassert themselves. At the same time, a large contingent of HBS faculty had seen service in Europe in World War II, and were eager to help in that revival. How could Teele seize the moment, and reorient his faculty to begin to "think across borders"?

Meanwhile, Nestlé was facing challenges of its own. In 1952, the company—based in Vevey, Switzerland—had a workforce of 150,000 and $12 billion in annual sales. It also had a highly unusual leadership structure. Its managing directorship was divided between two men: the Swiss-born Jean C. Corthésy and an Italian executive named Enrico Bignami. Bignami, in particular, was concerned about Nestlé's pipeline of future executives. How could the fast-moving, globally-oriented manufacturing firm cultivate future leaders trained in modern business methods?

The answer to both institutions' questions emerged from a meeting in a New York hotel room in 1955, at which HBS professors C. Roland Christensen and George Albert Smith, Jr., hammered out an agreement with Bignami and Corthésy, whereby HBS professors would teach executives on site in Switzerland. On three critical points, the Nestlé executives took HBS's advice. First, the company agreed that at least 35 percent of the program's participants would be from outside Nestlé. Second, the curriculum would focus on basic management skills, rather than higher-level issues. And third, the program faculty would employ the case method.

Thus was born the Institut pour l'Etude des Methodes de Direction de l'Enterprise, or IMEDE. The new school opened its doors in Lausanne in 1957, funded by Nestlé and guided intellectually by HBS. Over the next quarter-century, IMEDE offered eight-month and summer programs to hundreds of Nestlé managers, and hosted dozens of HBS professors.

The HBS-Nestlé relationship was both strategic and successful. For example: Both institutions were later run by "graduates" of IMEDE: Dean John McArthur at HBS, and Nestlé CEO Helmut Maucher. When HBS professor Harry Hansen retired in 1977, he was appointed dean of IMEDE. As for Enrico Bignami—whom HBS professor C. Roland Christensen described as "an intellect, a business practitioner, an educator, and a dreamer"—he served several terms on the HBS Visiting Committee in the 1960s, and later founded a second school in Lausanne for public administrators.

The creation of IMEDE also helped transform Nestlé into a major research resource for Harvard—an unusual circumstance for a European company, which were traditionally more secretive than their U.S. counterparts. Having Nestlé's "seal of approval" also helped HBS researchers get into other European companies and industries. While teaching at IMEDE, for example, Ken Andrews researched and wrote a ground-breaking series of cases on the Swiss watch industry, which set a new standard of depth and granularity in case-writing.