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Strategic Analysis of Unilever

STRATEGIC MANAGEMENT
ANALYSIS

Strategic Analysis of Unilever

Strategic Analysis of Unilever

Strategic Analysis of Unilever

Strategic Management
Topic:

Strategic Analysis of Unilever

Submitted to:

Ms.Aiza

Submitted by:

Sana Rahat
Ayesha Rasheed

Submitted on: 29 February, 2016

Department: Business Administration

Lahore Garrison University

Strategic Analysis of Unilever

Introduction
Unilever is a British-Dutch multinational consumer goods company co-headquartered in Rotterdam
Netherlands, and London, United Kingdom. Its products include food, beverages, cleaning
agents and personal care products. It is the world's third-largest consumer goods company and its
products are available in around 190 countries.
Unilever owns over 400 brands, but focuses on 14 brands with sales of over 1
billion euros - Axe/Lynx, reams, Hellmann's, Knorr, Lipton, Lux, Magnum, Rama, Rexona akaSure\
Degree\Rexoena\Shield, Sunsilk and Surf. It is a dual-listed company consisting of Unilever N.V.,
based in Rotterdam, and Unilever plc., based in London. The two companies operate as a single
business, with a common board of directors. Unilever is organized into four main divisions - Foods,
Refreshment (beverages and ice cream), Home Care, and Personal Care. It has research and
development facilities in the United Kingdom the Netherlands, China, India and the United States

Strategic Analysis of Unilever

History of Unilever

Strategic Analysis of Unilever

Mission Statement
Vitality is at the heart of Unilever. Our mission is to meet every day needs for nutrition, home
hygiene and personal care with brands that help people feel good, look good and get more out of
life.
Vision Statement
Unilever is a unique company, with a proud history and a bright future. We have ambitious plans
for sustainable growth and an intense sense of social purpose.

Purpose and Goals

Our purpose is to make sustainable living
commonplace. We work to create a better future
every day, with brands and services that help
people feel good, look good, and get more out of
life.
Strategy and long-term financial target

At the heart of Unilever's strategy is a

concentration of resources on areas where it
have leading category and brand positions and
which offer excellent opportunities for profitable growth, especially in personal care, developing
and emerging markets and Vitality.
The focus is primarily on developing the business
Organically but acquisitions and disposals can
also play a role in accelerating the portfolio
development.
To execute this strategy Unilever
have
reorganized the business to
simplify
the
organization and management structure and
to improve capabilities in marketing, customer
management, and research and development.
The result is better allocation of resources, faster
Decision-making and a lower cost level.
This transformation, known as the One Unilever
program, allows us to leverage its scale both
globally and locally .
Unilever's long-term ambition is to be in the top
third of its peer group in terms of total
shareholder return.

Strategic Analysis of Unilever

Organizational Structure of Unilever

Strategic Analysis of Unilever

Brands of Unilever

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Strategic Analysis of Unilever

Unilever is a dual-listed company consisting of

Unilever N.V., based in Rotterdam, and

Unilever plc, based in London.
The two companies operate as a single business, with a common board of directors

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Strategic Analysis of Unilever

SECTION # 1

MISSION STATEMENT
ANALYSIS

Mission Statement Analysis of Unilever

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Strategic Analysis of Unilever

Concept of Mission Statement

A mission statement is a simple and concise statement which is used as a way of communicating
the purpose and short term goals of the organization.
Characteristics of a Mission Statement

Broad in Scope
Less than 250 words
Inspiring
Identify the utility of a firms products
Include nine components
Reconciliatory
Enduring

In the analysis of Unilevers mission statement we could see that all elements with the exception of
one were clearly and wisely highlighted
Unilevers strategic management personnel have selected a very vast meaning word Vitality which
explains most of the components namely- technology, self-concept and concern for employees
Their three product categories are also highlighted which is also giving a clue of their customer
category.
Unilever want their customers to have best quality food and sterile surroundings which has revealed
their philosophy.
In our analysis we find that one component was not highlighted which was market geography
Although there is also a possibility that companys mission statement experts may have revealed the
companys market geography but as we are inexperienced so we could not find it.

Unilevers New-proposed mission statement

After deeply analyzing the components in Unilevers current mission statement and pinpointing the
missing one ,we designed our new mission statement for Unilever
We have tried our best to include all nine components while designing it
The detailed analysis of current and proposed mission statement is given on the next page

Unilever Mission Statement

No.

Component

Verdict

Reasons

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Strategic Analysis of Unilever

s
Unilever has customized its customers having needs of
1.

Customers

Yes

nutrition, home hygiene and personal care.

In this mission statement, Unilever is showing its

2.

3.

4.

5.

Concern for
Survival

Yes

Products and
Services

Yes

Concern for
Employees

Yes

Philosophy

Yes

products as everyday needs for people which is actually

helping them in their survival and increasing their profit.
The three everyday needs (nutrition, home hygiene and
personal care) identified by Unilever reflects clearly what
they are producing.
Vitality is incorporated in everyone linked with Unilever
which reflects that their employees are creative, always
seeks to bring energy, zeal and liveliness in their products
Unilevers basic belief is to provide best quality with
continuous creativity.
Unilever has wisely used a word vitality which has very

6.

7.

Self-Concept
Concern for
Public Image

Yes

vast meaning. It indicates their competitive edge of being

creative
Unilever wants its customers to feel good, look good and

Yes

get more out of life which shows its social concern

towards its customers.
The word vitality reflects that there is energy, creativity

8.

Technology

Yes

and liveliness in their company which means they are

constantly adopting new technologies.
There is no geographical distribution of market in their

9.
Vitality

Markets
8,5,6

No

mission statement.
4

is at the heart of Unilever . Our mission is tofulfill every day needs2 for nutrition,

home hygiene and personal care1,3 with brands that help people feel good, look good and gemore
out of life5,8,7.

Unilever New Mission Statement

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Strategic Analysis of Unilever

No.

1.

Component
s
Customers

Verdict

Yes

Reasons
Unilever targets those people having needs of health,
beauty, sterility related products.
Geographically Unilever is serving all over the country.

2.
3.

4.

5.

Markets
Products and
Services
Concern for
Employees
Philosophy

Yes
Yes

The products associated with Health, Sterility and Beauty

indicates their brands.

Yes

Unilevers employees are their valuable assets as they are

serving efficiently and whole heartedly.

Yes

Unilevers basic belief is to provide quality products with

integrity--sincerity, honesty and truthfulness.

6.

Self-Concept

Yes

7.

Concern for
Public Image

Yes

8.

Technology

Yes

9.

Concern for
Survival

Yes

Unilever has a competitive edge that it is leading consumer

products company and provides people with superior
quality products.
The phrase intense sense of social purpose shows that
Unilever is deeply concern to invest in society thus reducing
environmental footprint.
The words leading consumer product company and
operating creativity shows that Unilever is continuously
trying to bring innovation through breakthrough technology.
Unilever is committed to sustainable growth by providing
daily needs becoming a leading consumer product
company.

We are leading consumer products company 6, 8, 9 in Pakistan.2 Our mission is to fulfill daily
needs 9 of our customers by superior quality products 5, 6 that will enhance their health, sterility
and beauty1, 3. Our proficient employees4 are operating creatively6,8 with integrity5 and an
intense sense of social purpose 7 to help position Unilever for sustainable growth 9.

Section # 2

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Strategic Analysis of Unilever

SWOT Analysis of Unilever

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Strategic Analysis of Unilever

WEAKNESSES

STRENGTHS

1.
2.
3.
4.
5.
6.

Wide Brand Portfolio

(more than 400 brands)
Pricing Power
Innovative Culture
Strong Supply Chain
Strong Brand Image
Market Dominance
(43% of market share)

OPPORTUNITY

1.
2.
3.
4.
5.

Enter into new product markets

Social media presence
High rate of population Growth
Opportunity to diversify in Unrelated
Businesses
Capture
market
in
developing
countries.

1.
2.

3.
4.
5.

High Debt Burden

(78% Debt Financing)
Nepotism
(Khanewal Tea Factory Bribery
Scandal)
High Staff Turnover-35%
Strategic Alliance
Failure of Social Concern
(Death of participant in Unilevers
Clear men show due to lack of security)

THREATS

1. Bad Publicity
2. Possible increase of market share of
Competitors like P&G
3. Rising Inflation
4. Failure of Complex Supply Chain
5. Continuous increase in Smuggling of tea
and shampoos

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Strategic Analysis of Unilever

Strengths

SWOT
MATRIX
OF UNILEVER

1
2
3
4
5
6

Opportunities

1
2
3
4
5

Enter into new product

markets
Social media presence
High rate of population
Growth
Opportunity to diversify in
Unrelated Businesses
Capture
Market
in
Developing countries.

Threats

1
2

3
4
5

Bad word of mouth

Possible
increase
of
market
share
of
Competitors like P&G.
Rising Inflation
Failure of Complex Supply
Chain
Continuous increase in
Smuggling of tea and
shampoos.

Wide Brand Portfolio

Pricing Power
Innovative Culture
Strong & Complex
Supply Chain
Strong Brand Image
Market Dominance

S-O Strategies

1.(S3-O1,04)
Sustainable Growth
2.(S2,S6-O3)
Increase in purchasing power
due to more customers
3.(S1,S4,S5-O5)
Improving Living Standard by
fulfilling daily needs.

S-T Strategies

1.(S1,S6-T3)
Retain customers
2.(S3-T2)
Gain more market share

Weaknesses

1
2
3
4
5

High Debt Burden

Nepotism
High Staff Turnover
Unusual Strategic
Alliances
Failure of Social
Concern

W-O Strategies

1. (W4-O1,O4)
Become self sufficient
2.(O2-W2,W5)
Create Awareness
among
people

W-T Strategies

1.(W2,W5-T1)
Win back trust
2.(W4-T2)
Increase in revenue
generation

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Strategic Analysis of Unilever

SWOT Matrix of Unilever

S-O Strategies
1. (S3-O1,04) -Sustainable Growth
By utilizing the strength of their innovative culture,Unilever can enter
into new product markets and diversify in unrelated businesses
For instance like pringles by P&G and Lays by PepsiCo, Unilever can
come up with its chips. It can also introduce frozen foods or add a
cosmetics brand in its personal care segment
Like Nestle acquired an eye care products company Alcon,Unilever
can also diversify itself in Unrelated business
2. (S2, S6-O3) - Increase in purchasing
power due to more customers
Unilever with the market share of 43%
has a power to influence prices so they
can easily handle high rate of Population
growth i-e 2% increase per annum.
3

(S4, S5-O5) - Improving Living

Standard by fulfilling daily needs.
With their wide brand portfolio ,strong
supply chain and strong brand
image,Unilever can also capture markets
in developing countries
In their brand portfolio we can see cheap substitutes of almost every
product
Moreover they have a very strong supply chain which shows there is a
timely connectivity of raw material to production units and to all retail
stores and their brand image is very strong so they can easily access
markets in developing countries
W-T Strategies
1.

2.

(W2,W5-T1)-Winback Trust
Unilever have a threat of losing trust of people if they did not gain trust
of their people which was lost due to many
scandals and rumors against them

(W4-T2)-Increase
in
Revenue
Generation
By reducing Unwanted strategic alliances
like the one they did with Philips Unilever
can increase its market share instead of
losing it

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Strategic Analysis of Unilever

W-O Strategies
1. (W4-O1,O4)-Become self sufficient
Unliver should lessen the unwanted strategic alliances which was actually done to double the
revenue and focus on becoming self-sufficient by entering and diversifying into new markets
2 (O2-W2, W5)-Create Awareness among people
There are many scandals about Unilever that they do favoritism in recruitment and due to lack of
security concerns ,one member in the Clear Men show died so through social media presence
Unilever can regain trust of its customers
through explain and
clearing all complications

S-T Strategies
1.

(S1,S6-T3)-Retain customers
With their wide brand portfolio and high
can retain customers in the time of rising inflation i-e 8.1%
It can provide inexpensive substitutes when prices are high

2.

(S3-T2)-Gain more market share

With its innovative culture, Unilever can make strategies that can help
them to increase their market share, ultimately lessening the threat of
competitors.

Conclusion
After throwing light on some aspects of
strategic analysis of Unilever we arrive at a

market share ,Unilever

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Strategic Analysis of Unilever

conclusion that overall Unilever has considerable competitive edge in the market it is operating but
despite these strengths the company has some shortcomings which might damage their reputation in
future.Moreover Unilever has some potential opportunities which can help it to diminish these
threats
Furthermore this project has greatly benefited us and made us capable to understand what elements
are vital and effectve in designing a mission statement and how companies analyze their internal and
external environment and cope with challenges that exist around them

Recommendation
Following are the couple of recommendations which might enhance Unilevers performance
1.
2.

3.

Show where they are serving geographically in their mission statement.

Overcome weaknesses by utilizing strengths and availing opportunities
Workout to decrease favoritisms in recruitment procedure and regain loyalty of their employees
Cut down Unwanted strategic alliances thus reducing the weakness of losing market share
Win back trust of people by organizing focus group sessions, seminars, and advertisements.
Engage in related as well as unrelated diversification to maximize revenue.

Limitations
The project on strategic analysis of Unilever proved to be very beneficial for us but we only
analyzed some aspects of their strategic management due to time and budget constraints. Moreover
our reference in Unilever was in another city due to which we became unable to visit the company
In our next educational project, we aim to design all other models used in effective strategic planning
of a company. Moreover we also aim to visit the companys strategic management department.

References:

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Strategic Analysis of Unilever

www.Unilever.com.pk
www.Unilever/Newspress.com
www.Unilever Professionals.com
www.the green supply chain.com
www.Unilever Corporatewatch.com
www.Unilever corporate crimes.com
www.Unilever Scandals .com
www.Scmr/Unilever.com
www.forbes.com
www.The News.com
www.strategic analysis of Unilever.com.pk
www.inbound logistics.com
www.acadmis.edu.pk
www.businesswire.com
www.business world .com
www.management study guide.com
www.news.bbc.co.uk