Presented by

Sanjeev Prasad
 OUTLINE
I. Company Overview IV. Story of change
a) History 1. Challenge
b) Operations 2. set objective
c) P&G in India 3. implementation
4. Result
II. Issues & Outlook profile
1. Mission Statement V. Change in strategy
2. The Vision 1. Preparing people for change
3. Values McKinsey 7 S Model
4. Objectives
5. Current Strategies
6. Strategic Issues

III. SWOT Analysis

I. Company Overview
Procter & Gamble is an American global corporation based on
manufacturing a wide range of consumer goods.

As of 2008, P&G is the 6th largest Company by Market Cap., 14th

largest by profit, and 10th in Fortune's Most Admired Companies list.

• History

 William Procter, a candle maker, and James Gamble, a soap maker,

formed the company known as Procter & Gamble in 1837.

 Throughout the twentieth century, the company moved into other

countries, both in terms of manufacturing and product sales,
becoming an international corporation.

 Known for people centric company, First profit sharing Plans (25%
share is in the hand of employees)
b) Operations

1. Beauty
Beauty segment
Grooming segment

2. Household Care
Baby Care and Family Care segment
Fabric Care and Home Care segment

3. Health & Well-Being

Health Care
Snacks, Coffee and Pet Care
II. Issues & Outlook profile
3. Mission Statement
We will provide branded products and services of superior quality and value that improve
the lives of the world's consumers, now and for generations to come.

2. The Vision
“Be, and be recognized as, the best consumer products and services company in the
world.”

3. Values
Integrity
Passion for Winning
Leadership
Trust
Ownership

4. Objectives
- Build existing core businesses into stronger global leaders
- Grow leading brands, big countries, winning customers
- Develop faster-growing, higher-margin with global leadership potential
- Regain growth momentum and leadership in Western Europe
- Drive growth in key developing markets
5. Current Strategies
3. Consumers will pay a premium for products that offer improvements over either private-
label products or the brands they have bought for years.

5. Product innovation must be regular with visible improvements year constantly.

7. Product innovation must be designed to constantly "up-scale" consumer preferences.

9. This “up-scaling” of consumer tastes is not just for affluent consumers.

11. These strategies of innovation and pricing can be used to break into developing
economies

• Using innovation to attain a growing share of developing markets will be the key to
growing company earnings as growth rates in mature consumer markets
1. Strategic Issues

- Competitive pressure is a constant and consistent challenge

- Risks of over confidence and complexity

- Rising commodity costs

- Global economic and political instability

SWOT analysis

Strengths
1. Strong financial position
2. Large scale of operations
3. Strong branding
4. Product innovation
5. Developing markets infrastructure

Weaknesses
1. Customer concentration
2. Lack of effective distribution in some countries
SWOT analysis

Opportunities
1. Wide range of demography
2. Developing markets
3. Gillette, old spice, Vicks acquisition
4. New products

Threats
1. Uncertainty in pharmaceuticals business
2. Increase in prices of raw materials
3. Intense competition
4. Unfavorable business laws and political instability
 Story of Change
July,1999
P&G's President and CEO, Durk Jager

1. Challenges
 No innovation since 1985
 strong, traditional and conservative culture
 Losing market dominance

2. Objective
 Fasten the decision making to innovate
 Eliminate bureaucracy
 Reduce costs
 Story of Change
3. Implementation,- “Organization 2005”

 Radical revamping of P&G's organizational culture

 Reduction in hierarchies
 Retrenchment of employees
 Use of IT to fasten the decision making
 Target to double in global revenues till 2005
 Informal work environment to promote innovation
RESULT ??
?
“F” for “Fabulous”
Or

“F” for “Failed”

RESULT
“

“F” for “Failed”

“F” for “Failed”
2.Because Not Executed Properly
3.Culture cannot be changed in a single day

Result
•Rise in cost, decline in profitability
•President and CEO, Durk Jager resigned in 2000 and
A.G.Laflay took the position
“Winners Do Not Do
Different Things, They Do
The Things Differently”
Change in Strategy
Preparing people for change

Communication of entire plan

Motivation
Use of IT as a facilitator (AskMe enterprise,
Corporate standards System)
Training (Cultural sensitivity , Motivation)

Understanding the difference between urgent and

essential
Change in Strategy
Preparing people for change

"Business schools tend to focus on inductive thinking (based on

directly observable facts) and deductive thinking (logic and analysis,
typically based on past evidence)," .
“Design schools emphasize abductive thinking—imagining what
could be possible. This new thinking approach helps us challenge
assumed constraints and add to ideas, versus discouraging them."
-A.G. Laflay
Change in Strategy
Implementation
Structure
Decentralized decision making

Staff
New management (Representing different countries)

Recruitment
Good relationship with top B - schools
Comprehensive selection process
Focus on innovation and leadership
Change in Strategy
Implementation
Shared values
Customer is the king
P&G as a leader

System
Fast decision making
Reward for efforts and learning
Change in Strategy
Implementation
Skills
Leveraging the cultural differences
Focus on innovation
IT, R&D experts (9,000 R&D associates,1,100 PhDs)

Style
Focus on leadership
Use of IT (AskMe Enterprise system)
Change in Strategy
Implementation
Strategy
Establish a clear criteria and don’t hesitate to
shift resources
Revolution does not last for long but evolution
does
Focus on customers rather than only innovation
Acquisition of innovative companies
Employee’s involvement
Win over Cross boundaries and help others
do the same
Concentrate on possibility
Mass marketing
Change in Strategy
Implementation
Strategy
Customer’s involvement (olayfryou.com)
(Diaper, deodorant, Mouth wash)
Thank you
for feedback
sanjeev654@gmail.com