1. Lafley claims that his key objectives are to make the firm more agile and flexible.

Come up with specific steps that Lafley has taken to push the firm in this direction. Lafley earned his leadership chops out of crisis, led with a quiet charisma, had a clear focus, and constantly communicated. Since his appointment in 2000, Lafley has begun to implement a series of changes that are designed to radically alter the firm. Determined to create a more outwardly focused and flexible company, Lafley broke down the walls between management and the employees, and made drastic changes in the organizational structure and workforce of the company. He understood the power of a consistent message. His mantra for nine years: "The consumer is boss." Diligently and methodically, he spread the word that P&G had to focus on big brands, big markets, and big customers. He said that P&G, to win with powerful discounters, must slash costs and reinvest savings in marketing and product design. Focusing on those things, Lafley became the best organic-growth guy in the consumer-products industry. In a 2004 Fortune story about P&G's innovation drive, quoted him: "Organic growth is more valuable because it comes from your core competencies. Organic growth exercises your innovation muscle. It is a muscle. If you use it, it gets stronger." He drove innovation by reaching outside for ideas -- an alien concept for promote-from-within P&G. Shamelessly, he used hokey terms to communicate: "Connect and develop" was his term for partnerships with outsiders who might be more creative than the folks at P&G. P&G employees understood Lafley's mission. The company's results proved that. By driving innovation in age-old brands like Tide and Crest and Olay, P&G outperforming rivals like Unilever (UL) and Colgate-Palmolive (CL). But even as Lafley declared that acquisitions are risky, he didn't shy away from them completely. "When we acquire, we acquire to build the core," He bought Wella and Clairol to expand P&G's beauty business. And as P&G grew to be a top player in personal care, he bought Gillette for $57 billion in 2005. That acquisition added five billion-dollar brands -- Gillette, Oral-B, Braun, Duracell, and Mach3 -- to P&G's stable of 16. Last year, annual sales of Gillette Fusion topped $1 billion, and today P&G claims 23 billion-dollar brands. 2. Assess Lafleys leadership of Proctor & Gamble. How does his style contrast with that of Jaegers? Integrity. Trust. A passion for service. These are just a few of the characteristics of great leaders according to A.G. Lafley.

Procter's board immediately named Alan G. Lafley, a 23-year employee of the company, to succeed Durk I. Jager, the hard-charging executive who had vowed to shake up the company's staid culture and force managers to act in a more entrepreneurial style. It also called John E. Pepper, Mr. Jager's predecessor and longtime rival, out of retirement to serve as chairman. The first thing Lafley told his managers when he took the job was just what they wanted to hear: Focus on what you do well -- selling the company's major brands such as Tide, Pampers, and Crest -- instead of trying to develop the next big thing. Durk I. Jager, former CEO of Procter & Gamble Co., was clear about his goals when he took office in 1999: shore up overseas operation and grow top brands. These measures would remedy sagging sales and redeem P&G's image as the leading global marketer of consumer products. However, Jager's strategy for achieving these goals was perceived as being so abrasive, so discordant with P&G's personality that his management team rebelled against him. He was forced to resign in less than two years. Alan G. Lafley, a longtime executive who understood and respected the company's culture, took office in 2000. Through a combination of wisdom, humility, personal engagement, and a careful alignment of change strategy to corporate personality, Lafley has turned P&G into one of the great corporate success stories of the twenty-first century. The conventional thinking is that the soft-spoken Lafley was exactly the antidote P&G needed after Jager. After all, Jager had charged into office determined to rip apart P&G's insular culture and remake it from the bottom up. Instead of pushing P&G to excel, however, the torrent of proclamations and initiatives during Jager's 17month reign nearly brought the venerable company to a grinding halt. Enter Lafley. A 23-year P&G veteran, he wasn't supposed to bring fundamental change; he was asked simply to restore the company's equilibrium. In fact, he came in warning that Jager had tried to implement too many changes too quickly (which Jager readily admits now). Since then, the mild-mannered 56-year-old chief executive has worked to revive both urgency and hope: urgency because, in the previous 15 years, P&G had developed exactly one successful new brand, the Swiffer dust mop; and hope because, after Jager, employees needed reassurance that the old ways still had value. Clearly, Lafley has undone the damage at P&G. Lafley is leading the most sweeping transformation of the company since it was founded by William Procter and James Gamble in 1837 as a maker of soap and candles. Long before he became CEO, Lafley had been pondering how to make P&G relevant in the 21st century, when speed and agility would matter more than heft. As president of North American operations, he even spoke with Jager about the need to remake the company.

So how has Lafley succeeded where Jager so spectacularly failed? In a word, style. Where Jager was gruff, Lafley is soothing. Where Jager bullied, Lafley persuades. He listens more than he talks. He is living proof that the messenger is just as important as the message. As he says, "I'm not a screamer, not a yeller. But don't get confused by my style. I am very decisive." Or as Robert A. McDonald, president of P&G's global fabric and home-care division, says, "people want to follow him. I frankly love him like my brother." Indeed, Lafley's charm offensive has so disarmed most P&Gers that he has been able to change the company profoundly. Still, the Lafley revolution is far from over. Precisely because of his achievements, Lafley is now under enormous pressure to return P&G to what it considers its rightful place in Corporate America: a company that is admired, imitated, and uncommonly profitable. Nowhere are those expectations more apparent than on the second floor of headquarters, where three former chief executives still keep offices. 3. What intangible resources of P&G is Lafley focusing on? We are a company that is built on intangible assets, says Lafley. The intangible assets are the brands and under those brands are the people who created the brand and breathed life into it. They keep it alive and keep it growing. Extensive Research and Development program. Knowledge/Experience ' gained from the close partnership and collaboration with entrepreneurs and even rival companies. Customer feedback '

Intangible assets are defined as identifiable non-monetary assets that cannot be seen, touched or physically measured, which are created through time and/or effort and that are identifiable as a separate asset. One of the biggest intangible resources of P&G is Extensive Research and Development program. P&G invests massive amounts on R&D and technology which it uses for building new products. Until1999, use of only R&D and technology for creating new products turned out the main reason for failure of its products. Under the management of Lafley, P&G introduced customer feedback and made use of existing R&D and technology to better tailor their products to meet the needs of the customer. This helped P&G in securing a competitive edge over its rivals. Lafley introduced open innovation program called Connect and Develop which helped P&G gain knowledge and experience from close partnership and collaboration with entrepreneurs and even rival companies. Another important intangible asset of P&G is its brand image which it has earned over the years. This helped Lafley to easily collaborate with other companies and enter new segments of markets such as premium fragrances. A wide range of

product lines also helped Lafley to better manage its resources. It was relatively easy to shift the resources from a loss making product to more profitable products which demand more resources. . Also, by focusing on the core brands, P&G reduced50-plus product-development projects to a dozen. This together with the sale of non-core businesses and the removal of failed products resulted in $2billion in savings for 2001. 4. What steps has Lafley taken to make P&G an ethical learning organization? Purposes/Values/Principles (PVP) A high-level statement of the Companys statement of purpose, the core values and principles they hold. Examples: They provide products and services of superior quality and value that improve the lives of the world's consumers.(Purposes) Integrity They always try to do the right thing (Core Values) They show respect for all individuals (Principles) Company Policy Statements Inspirational statements of the application of the PVP to broad, major issues and societal expectations. Examples: Environmental Quality Policy Policies of Personal Behavior in the Workplace Operating Policies/Procedures/Practices Administrative procedures and expectations necessary for the operation of company systems and internal controls designed to implement Company positions. Examples: Expense accounts should be submitted within 7 days from the return from a trip (flows from the Company's Policy Statement on Accuracy of Company's Records) Worldwide Business Conduct Standards An expression of specific Company policy Statements as they relate to the standards of individual behavior expected of each and every employee. Examples: Do not engage in discrimination or harassment Do report immediately if you feel you are being harassed or discriminated against (flows from the Company's Policy Statement on Harassment/Discrimination) Implementing Systems & Internal Controls

Tools and processes to carry-out and monitor the consistent implementation of standards, policies and procedures. Examples: Global Expense Reporting form and process Work and Development Plan process Control Self Assessment (CSAs) 5. What is Lafley hoping to achieve with his changes at P&G? What are his chances of success with the radical changes that he intends to make? Proctor and Gamble had experienced and faced deterioration in the profits due to radical changes that were brought by the previous management. As a new leader of an organization who is more likely to fall, he wants to transform the organization from what it is to what he wants it to be. Lafley just did of this so called leadership to do the right things right. To begin with, he started with a vision and process to bring changes. A vision to create a more outwardly focused and flexible company by breaking down the walls between management and employees; and made drastic changes in the organizational structure and workforce of the company. The acquisition and integration of the Gillete Company for the improvement of its own product is one of the radical changes that brought higher revenues and profits to the firm. In order to be successful in the radical changes he wants to make, he should be engaged in interdependent activities set direction, design the organization and nurture a culture dedicated to excellence and ethical 5ehaviour. Lafley sets the direction by focusing on serving the needs of the consumer. He had been aware of what the organization would become if there would be integration of knowledge. He redesigns the organization by breaking the walls between the management and employees. A successful leader must be actively involved in building structures, teams, systems and organizational process that would facilitate the implementation of their vision and strategies.