MPE @ NMIMS
Name: Roll No: Subject: VINAY DIXIT MPE 080123 Understanding Management and Organization Session No: 1 & 2 Theme No: 1
Assignment: Evolution of Procter & Gamble Company Brief & Role Description: NA Procter & Gamble
Procter & Gamble (P&G) is one of the biggest brands of the 21st century. Looking into the future, P&G is always customer focused and maintains its integrity, leadership, ownership, and its passion for winning and trust. It looks up to competitors to assess self-effectiveness and efficiency and supersedes many top notch companies in being sensitive towards its employees, their needs, culture and diversity. It believes in doing in-depth research before coming out with a product or changing it. It was one of the early adopters of technology in the industry. It not only realized the power of media in the right time but also made good use of it to attract more consumers to its products, retain them, and to showcase its strong presence in the market. Serving millions of consumers in over 180 countries, P&G is indeed one of the biggest giants in the industry and there’s no looking back.
P&G provides branded products and services of superior quality and value that improve the lives of the world's consumers, now and for generations to come. As a result, P&G expects to be rewarded with leadership sales, profit and value creation, allowing P&G staff, shareholders and the communities to prosper.
Values & Principles
P&G recruits the finest people in the world. It builds its organization from within, promoting and rewarding people without regard to any difference unrelated to performance. Integrity, leadership, ownership, passion for winning and trust are P&G’s top value buckets. Respect for all Individuals, inseparable interest for company and individuals, strategy work, innovation, external focus, value for personal mastery, be the best and mutual interdependency are their core principles.
A candle maker William Procter and soap maker James Gamble incepted two distinct companies in Cincinnati, Ohio, USA. The two men, immigrants from England and Ireland respectively, became rivals in business for using similar resources. But later also became brothers-in-law by marrying sisters in the same family. During the US recession in 1837, they joined hands to fight the recession together and a new enterprise was formed: Proctor and Gamble. P&G first operated out of a storeroom. Procter ran the store while Gamble ran the manufacturing operation. Candles were P&G’s most important product at that time.
Inc. In the mid-1950s. Inc. including P&G. P&G reached its 1 million mark in 1857 with 80 employees. Health Care & Corporate New Ventures. Many American companies.
The Growth: Looking Towards Future
In its early years. for $1. senior management representation.22 billion for the Iams Company. family-operated soap and candle company now provides products and services of superior quality and value to consumers in over 180 countries. P&G purchased the Eagle Snacks brand line from Anheuser-Busch. P&G announced an acquisition of Gillette. In 1996. Last but not the least in January 2005. In July 1997. it bought the worldwide Max Factor and Betrix lines from Revlon.000 employees working in over 80 countries worldwide. P&G spent $1. The company has demonstrated significant representation of African Americans and other ethnic minorities in the area of corporate procurement. Beauty Care. In 20 years of its inception. Food & Beverage. P&G announced its first overseas subsidiary in England in 1930 and later moved into the Philippines in 1935.03 billion and in 1994 entered the European tissue and towel market through acquisition of Vereinigte Papierwerke Schickedanz AG's European tissue unit and the prestige fragrance business of Giorgio Beverly Hills. Inc. In 1955 it bought the Lexington.T. In 1999. P&G experienced a number of strikes and demonstrations. P&G acquired the Charmin Paper Company and the Clorox Chemical Company. P&G began acquiring smaller companies aggressively. P&G built factories in various other locations in the US. P&G was in competition with at least 14 manufacturers. and total workforce. and Latin American brands Lavan San household cleaner and Magia Blanca bleach. the US baby wipes brand Baby Fresh. company began to expand itself first out of Cincinnati and later out of United States. Kentucky-based nut company W. New location gave the company better access to shipping routes and stockyards. As the demand for P&G product grew. Latin America. and therefore Procter & Gamble grew. and Nebraska Consolidated Mills Company.
The company’s significant growth required better strategic decisions to be made by the business. but later organized around four regions North America. owner of the Duncan Hines product line. Feminine Protection.
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Employee Focus @ P&G
P&G is operating in more than 80 countries and remains very sensitive towards cultural diversity. and the Tampax line of tampons. P&G runs cultural diversity training program for its employees across all business geographies. P&G divided its operations into US and International. 1 position worldwide in feminine products. but the enterprising partners soon expanded their operations throughout neighbouring Hamilton and Butler counties in Ohio. P&G reentered the South African market following the lifting of US sanctions. In 1848. corporate board participation. thereby solidifying its No. Fabric & Home Care. In 1991.84 billion to acquire Tambrands. saw labour unrest in the 1880s. What began as a small. In 1988. The management introduced Saturday afternoons off for all workers but the company
. Cincinnati was also linked to the major cities of the East via rail. Asia. Young Foods.Now the P&G community consists of over 138. in its biggest deal P&G laid out $2. and Tissues & Towels. In 1957. P&G announced its largest joint venture to manufacture products in China. P&G again restructured its operations into seven global business units based on product lines: Baby Care. one of the leading makers of premium pet food in the US with annual global sales of approximately $800 million. and Europe/Middle East/Africa.
1 laundry detergent in the 21st century. Later in 1987. During the 1920s the flurry of new products continued. P&G patented the procedure. the spray that actually cleans away odor. synthetic soap products hit the market. revolutionized the way people washed their clothes.8 billion (3. After five years of research. P&G started focusing aggressively on soap market and began producing more than 30 varieties of soaps. together with home automatic washing machines. their habits and product
needs. Lafley. P&G management introduced a profit sharing program for its workforce to avoid them going on strikes and rather work hard to earn greater profit. “Ivory” soap was introduced in the market. It began experimenting with a hydrogenation process which combined liquid cottonseed oil with solid cottonseed oil. Further improvements in synthetics resulted in a host of new products years later.still faced 14 strikes in two years. the company decided to stop producing candles in 1920. P&G first identified use of vegetable oils for producing soap instead of animal fat. In1930. P&G established its R&D division to diversify its products and produce more innovative products. Camay was introduced and three years later Oxydol joined the P&G line of cleaning products. Two years later the company implemented an employee stock-purchase program. P&G’s success is based on a deep understanding of consumers. Its vision is simple: We want P&G to be known as the company that collaborates — inside and out — better than any other company in the world. In 1933. In 1900. Since then P&G's R&D team has revolutionized home care with products ranging from Dryel®.
Product Innovation through Research
In 2004-05 P&G invested $1. the first synthetic detergent for home use was introduced. the novel way to care for dry-clean-only clothes in home. After several years of research. followed by the first synthetic hair shampoo. the American Dental Association endorsed Crest and the product became the No. to Febreze®. Dreft. And then one of the biggest hit of all times in the history of soap industry. CEO. In 1926. develop and apply technology across its broad array of product categories and to collaborate with external innovation partners.5% of Net Outside Sales) in research and development (R&D). which in 1903 was tied to the profit-sharing plan. P&G was incorporated. 1 toothpaste.
In 1890s electricity became common in almost all places in the United States and there was a limited market left for candles. By 1915 61 percent of the company's employees started participating. Finally. It has collaborated with outside partners for generations. Ivory Flakes came out in 1919. and implemented an eight-hour workday in 1918. The company introduced a revolutionary sickness-disability program for its workers in 1915. to acquire. P&G has been recognized as a leader in employee-benefit programs ever since. In 1890. In 1960.G. nudging past Colgate in 1962. A. and also on the company’s ability to attract and support the best innovators in the world. with William Alexander Procter as its first president. Chipso soap flakes for industrial laundry machines were introduced in 1921. P&G
. Then Tide came as a miracle. researchers at P&G and at Indiana University developed a toothpaste using stannous fluoride that could substantially reduce cavities. Tide remains No.
Understanding Markets and Customers
External collaboration plays a key role in nearly 50 percent of P&G's products. and in 1911 ‘Crisco’ was introduced to the public. It’s a synthetic detergent that. in 1934. Drene. in 1955.
reducing dependency on network television. In 1939. P&G realized the power of television in its 5th month of inception and started its creative ad campaign on television which made a bigger impact on overall sales. Procter. the company restructured its brand-management system into a "matrix system” under which category managers became responsible for several brands. the company decided to diversify its advertising. In 1933. P&G became a key sponsor of radio's daytime serials. In 1987. Blair began a six-month tour of US kitchens and laundry rooms to assess the effectiveness of P&G products in practical use and to recommend improvements. had them analyzed and improved even before they went to market. a former promotions manager who had an up-close view of P&G's rival Unilever. The system would include a brand assistant who would execute the policies of the brand manager and would be primed for the top job. thereby becoming sensitive to the profits of other P&G products in their areas. Henceforth. The company's market research became more sophisticated when P&G chemist F.5 million on radio advertising.
Advertising and Branding Initiatives
Advertising was risky at the time. The restructuring also eliminated certain layers of management. The slogan was "99% pure".
An example of this is P&G’s Children’s Safe Drinking Water Program which is focused on reducing sickness and death resulting from drinking contam
. competing with the products of other firms as well as those of P&G. During 1985 P&G failed to respond to important changes in consumer shopping patterns. In 1931. Computerized market research including point-of-sale scanning also provided the most up-to-date information on consumer buying trends. the company had 21 programs on air and spent $9 million in it. P&G was spending $4. brand management became a fixture at P&G and was widely copied by other companies. in effect.W. It was forced to rethink its marketing strategy. This practice was the origin of P&G's superior product development.
P&G’s environment and science department determines where a product goes in the environment after use and how much of it goes there." Meaning.P&G also invested significantly in market research. suggested a system of "one manone brand. most advertisements were placed by disreputable manufacturers. By 1937. P&G brands continued to compete against one another. P&G approved a $11.000 annual advertising budget. committed to the excellence of the company's products. investigating consumer needs and product appeal. packaging and operations around the world. but far less actively. each brand operates as a separate business. The department has been analyzing the effects that ingredients in products have on the environment. quickening the decision-making process. in 1882. In the late 1980s. Another question determined is what will be the impact. Radio took P&G message into more homes than ever. Nevertheless. Downfall in broadcast television viewership (92% to 67%) hit P&G hard. Neil McElroy. P&G is one of the first companies in the world to actively study the environmental impact of high-volume ingredients in consumer products.