Executive Summary
P&G was founded in 1837 by William Procter and James Gamble as a maker of soaps and candles. P&G was known in Corporate America as a company to be admired and imitated. In addition, it was envied for its profitability as well as strong brand name. P&G has a long standing reputation as having life long employees. This dedication and loyalty by P&G's employees created the notion that outside sources were unwelcome and all products and ideas must come from within, however, this is not the way of the future.
Durk I. Jager was named CEO in January 1999 but tried to accomplish too much too fast. Jager entered into this position at a very difficult time in P&G's history and tried everything he knew to keep the company going. He introduced new high end products, which did not fit within P&G's culture. His solution to keep P&G going was to cut costs, however this was not a long term solution. He alienated the employee population in 17 short months. Acknowledging Jager's failure, P&G's board forced him to submit his resignation.
P&G employees needed a face lift and fast. A.G. Lafley, a Harvard graduate who spent his entire career with P&G was named CEO. He showed P&G employees that a family culture within the company was still attainable. Lafley focused on the employees and ensured the employees maintained focus on the consumers, as consumers are the basis of the market. He slowly began to change the old views of P&G. Not long after Lafley's appointment to CEO he replaced more than half of the company's top 30 officers and cut 9,600 jobs. P&Gs old view of internal creation was halted by Lafley. He acquired Clairol in 2001; P&Gs largest acquisition in its history. He also outsourced P&G's information-technology operation to help maintain its focus on the consumer and its brands. Lafley was able accomplish these non-traditional moves without alienating the family that was P&G.
Although Lafley has had success, the underlying problem remains. How will Lafley return P&G to its rightful place in Corporate America? P&G's solution to its problems is through product line extensions, expansion into non-premium brands, as well as acquisitions, licensing, reinforcing market orientation through consumer focus, and outsourcing. This recommendation was based on following items;
William Wrigley is the founder of the Wrigley Company which is currently traded on the S&P 500. It is also considered one of the great American success stories about a man, a dream, with the ambition and perseverance to see a dream turn into reality. William born entrepreneur with a keen sense for identifying opportunities and maximizing where others only saw risk. Some of Wrigley’s competitors at the time were the Hershey Company, Cadbury Schweppes, and Tootsie Roll Industries Inc. William Wrigley Jr. directed all of his energies toward producing his own line of chewing gums. In the beginning he himself created “two of the company’s earliest products - Sweet Sixteen Orange and Lotta Gum —revolutionized chewing gum’s appeal, spreading interest to the youth market and then to the public at large” (Wrigley, 2014)
Mr. Blake took over the position, which was held by Bob Nardelli who was forced to resign his post over the controversy surrounding his lucrative pay package. However, the underlying reason had just as much to do with his handling of the transformation of the company after he took the reins in December 2000 (Azzato, M.). With no previous retail experience, Nardelli's gruff management style is said to have alienated several key top-level managers.
The Procter and Gamble Company. (2013, November 17). Company Strategy. Retrieved March 22, 2014, from http://www.pginvestor.com: http://www.pginvestor.com/GenPage.aspx?IID=4004124&GKP=208821
the CEO at Home Depot, Robert Nardelli’s tenure was marked with heavy-handedness and inflexibility. Robert Nardelli’s leadership styles was autocratic. He utilized a command, control and conquer approach. He dictated policies and procedures, decided what goals were to be achieved, and directed and controlled all activities without any meaningful participation by the subordinates. He was in full control of the team, leaving low autonomy within the group. Before Nardelli came onboard, the managers of Home Depot had enjoyed independence under the laid-back entrepreneurship leadership style of Bernie Marcus. Almost immediately after Home Depot got Nardelli, he embarked on an aggressive plan to centralize control. He neglected the build relationships, inspired and aligned purpose, and create open communication with his team. He also disregarded the care of his shareholders. He was obsesses with goals, objectivity, and accomplishments within the boundaries of the values of the company. He
GM had experienced a level of success that developed a reputation as the world’s preeminent producer of automotive products. Because of its success, which produced substantial fiscal resources, the company was awash in cash flow, cash reserve, and lines of credit. GM’s management was the victim of 50 years of industry success. Management was characterized by a bloated, bureaucratic structure that impeded any attempt to improve the corporation. Top management established a fixed objective in the closed decision-making process towards GM’s strategic objectives. There was little to create a realistic Gap analysis, which made is easy to overlook the need to reinvent its management before undertaking the reinvention of the entire corporation.
This did not last long because just a quickly as they rose so did they fall. Within a year their stocks were down to little of nothing, and their name was not one someone wanted to be associated with. The downward spiral can be contributed to the organization culture and improper checks and balances.
McTigue Pierce, L. (2005, July). Pfizer: Growth amid adversity. Food & Drug Packaging, 69, p. 60.
Mr. Nardelli joined GE in 1971 as an entry-level manufacturing engineer. By 1995, he had risen to president and CEO of GE Power Systems, also having the title of GE senior vice president. In 2000 he left GE, and about 10 minutes after leaving he received a job offer from a member of the board of Home Depot.
B. Took General Electric from $13 billion in 1981 to more than $300 billion when he left in 2001. Ran GE like a corner shop – keeping an eye on profits, cash flow, and people
The current competitive situation for P&G is that it is one of the largest and most successful consumer products companies. This is evident in the high volume of sales and profits experienced by the company. Also, the company has updated all of its brands and created new product categories through innovation of the products, thus P&G is considered a leader in the consumer market. On the other hand, the company made cuts in its capital and research and development spending (which was in line with that of its rivals) in order to increase profits, which may serve to hinder the growth of the company. Therefore, competitively P&G may face difficulty in the growth of its earnings as oppose to its competitors.
Lafley then served as CEO from 2013 until 2015 when he was replaced by current CEO David S. Taylor. Under David Taylor’s leadership, Procter & Gamble launched two strategic initiatives. The first initiative was to “refocus its portfolio on the company’s 70 to 80 most lucrative product-market-market combinations, which are responsible for 90 percent of the revenues and almost all of its profits” (When Will P&G Play to Win Again, pg. 450). Procter & Gamble sold off almost 100 brands such as Iams and Duracell. This allowed Procter & Gamble to focus on the brands like Tide, Pampers, and Olay which are the most successful brands This initiative cut over $10 billion in expenses and has resulted in a Gross Profit Margin of 50% in 2016 (Fool.com). Procter & Gamble also focused on emerging markets as part of this initiative. Tide was launched in India and Pantene was launched in Brazil. The second initiative was “implementing strict cost-cutting measures through eliminating all spending not related to selling” (When Will P&G Play to Win Again, pg.450). According to Google.com/finance, Procter & Gamble’s stock price on September 21, 2012 was $69.42 and has increased to $93.55 on September 15 of this year. Currently Procter & Gamble’s market capitalization is $240.13
Companies all over the world varies but yet shares a common challenge, that is to solve problem not only effectively and efficiently but also creatively. The P-O-L-C framework which stands for Planning, Organising, Leading and Controlling plays a major role in both the company’s survivability and success. The SWOT analysis looks at both internal and external factors that can affect the Starbucks’s performance. The purpose of this report is to define and analyse how Starbucks respond and should have respond to the change of its external environment on the cofee market,This report will also identify and disscuss how The P-O-L-C framework and can help starbucks to compete and reduce the loss of their failing peformance in the Australian market and how SWOT analysis helps to define some externalities that can be a threat to Starbucks.
Right from the get-go, Jeff Immelt had an uphill battle taking over as CEO of GE. Several factors caused this to be a more difficult time than might otherwise have been. First, he assumed the role on September 7th, and of course a few days later, the United State was attacked. Immediately, he had to deal with GE casualties and donate cash and equipment towards the efforts at the World Trade Center. Second, Immelt came in on the heels of an economy that was cooling from the internet bubble a few years earlier. In September of 2000, the S&P 500 was over 1500, and a year later it was just above 1000. The attack on 9/11 further destabilized the weakened economy and sent investors scurrying for cover. According to the article by Christopher
Peters, T. J. & Waterman, R. H. (1982). In Search of Excellence: Lessons from America’s Best-Run Companies. New York: Harper &
P&G is an international and famous consumer goods founded in United States by Williams Procter and James Gamble both from the United Kingdom since 1837 about 177 years ago. P&G manufactures diversified range of product such as personal care, cleaning items, beauty product, pets food, drugs, & other beverages. Their products are sold in more than 180 countries around the world through grocery and departmental stores and retailers. They are also among the world’s most profitable consumer product company, with highest amount of sales. Their products are recognized in most part of the world. Their company have an organizational strategy to touch the live of its employees which is the major strength and competitive advantage of the company.