3. Procter & Gamble (P&G) is a Fortune 500 American
multinational corporation headquartered in downtown
Cincinnati, Ohio and manufactures a wide range of
consumer goods.
Founded 1837
Headquarters Cincinnati, Ohio, U.S.
Area served Worldwide
Key people Bob McDonald (Chairman,
President and CEO)
Revenue US$ 82.56 billion (FY 2011)
Operating income US$ 15.818 billion (FY 2011)
Net income US$ 11.797 billion (FY 2011)
Employees 127,000 (2010)
4. William Procter, a candlemaker, and James Gamble, a
soapmaker, immigrated from England and Ireland
respectively.
Sold in 160 countries
Manufacturing in 130 conutries
About 300 products
spends nearly $2 billion annually on R&D
In January 2005 P&G announced an acquisition of Gillette,
forming the largest consumer goods company and
placing Unilever into second place.
Competitors : JNJ, KMB, ITC, HUL
Global Business Units
› Beauty segment
› Grooming segment
› Health Care segment
› Snacks & Pet Care segment
› Fabric Care & Home Care segment
› Baby Care & Family Home Care segment
5.
6.
7. Value Chain Analysis is a process that
starts from the acquisition of raw
materials to actual physical products
sold by the company
Increase Competitive Advantage
Determines strategic benefits
8. Inbound Logistics / SCM
› Moments of truth
1. consumer comes to buy
2. satisfaction after consuming
Operations
› MDO – Market Dev Org & GBS – Global Bus Serv
Outbound Logistics / Distribution
Cross decking, efficient planning
Marketing & Sales
› 23 brands more than $ 1 billion
› Signals and Responses
Service
› More than $100 million in ADs
› 5000 key retailers & 30000 key suppliers
9. Firm Infrastructure
› R&D
› 25000 patents, more 7500 Ph.Ds in 71
countries
› Approx 4% of sales
Human Resource Management
› I.D.Systems - Vehicle Mgmt Systems
Technology
Procurement
10.
11. Life Cycle Assessment (LCA) is a tool used to
evaluate the potential environmental impact
of a product, process or activity throughout its
entire life cycle by quantifying the use of
resources ("inputs" such as energy, raw
materials, water) and environmental emissions
("outputs" to air, water and soil) associated with
the system that is being evaluated.
Two types of systems of particular interest to
P&G are
› the life cycle of a product (such as a detergent) or
› an activity (such as washing clothes).
12. Procter & Gamble complies with ISO 14040
Procter & Gamble has used Life Cycle Assessment to
guide decision making since the late 1980s. In the last
decade, Procter & Gamble has adopted ISO 14040
standards for LCA.
Managers at P&G routinely use LCA approaches to:
› Analyse products from a system-wide, functional unit point of
view in a consistent, transparent and reproducible manner in
order to: guide choices of raw materials, guide product
innovation and design packaging with lower impact,
› Analyse the energy and resource use in the detergent system,
› Analyse various emissions, wastes, and resources using
environmental themes,
› Identify what parameters are most likely to be significant to
monitor and control,
› Identify opportunities for improving overall system performance,
and
› Benchmark the product over time and report progress.
15. Low because of:
Enormous amount of product (14 Categories)
Extensive Distribution Channel
Huge capital Investment
Economies of Scale
Brand Power
Low switching cost
Note: Niche marketing firm can be a threat.
16. Moderate because of:
High brand value
Less threat of backward integration
Less threat of forward integration
Less switching cost
17. Limited because of:
Codependent relationship
P & G as a Key customer
Market share & growth rate ( more than 20
% overall growth for 2010)
18. High because:
Low involvement products
Competitor’s offerings with almost same
price & quality
Low switching cost
Eg. – Surf Excel & Ariel
19. High because:
Presence of strong competitors like HUL, ITC
& Colgate – Palmolive, J & J in different
markets
Low switching cost
21. SWOT Analysis
Strength Threats
» Market share » Price competition in family care and
» Brand image coffee categories
» Diversified products » Rising commodity prices, media
» Unique organizational chart fragmentation
» Global business Services » Global economic
» Market Development » Political disruption
organization » Government regulation
» Product availability » Strong Competitors
» Unique and Innovative » New Entrant
products » Cultural Norms & Values
» Brand conscious
» High quality products
Weaknesses Opportunities
» Merger » Expand market to other countries
» High prices » Reconsider target market
» Massy infrastructure » Buy shares to increase assets
» Decreasing sales » Launch competitive products
» Less advertisement » Use latest technology
» No Campaign for introducing » Develop distribution center in others
the products countries
22. Strengths Weakness
1. Market share 1. No Campaign for
2. Market Development introducing the
organization products
3. Brand image 2. High prices
4. Unique and Innovative 3. Decreasing sales
products
Opportunities 1. To enhance the 1. Enhance campaign
1. Use latest technology products through technologies
2. Expand market to other 2. Expanding into new 2. Seek more business by
countries market as being the lower prizes
3. Develop distribution market development 3. By increasing
center in others organization distribution centre they
countries 3. Stepping into market can increase there sells
development by using
brand name as a tool
Threats 1. Using brand name to 1. Lower prices to
1. Price competition in overcome pricing overcome political
family care and coffee competition instability
categories 2. Use uniqueness as a
2. Global economic tool to protect the
3. Political disruption economic environment
25. Key External Factors Weight Rating Weighted Scores
Opportunities
• Expand market to other countries 0.06 4 0.24
• Reconsider target market 0.07 3 0.21
• Buy shares of others shareholders from
all over the world for gaining more market share 0.05 4 0.2
• Launch competitive products 0.08 4 0.32
• Use latest technology 0.05 3 0.15
• Develop distribution center in others countries 0.04 2 0.08
Threats
• Price competition in family care and coffee
categories 0.07 4 0.28
• Rising commodity prices, media fragmentation 0.08 4 0.32
• Global economic 0.08 3 0.24
• Political disruption 0.09 4 0.36
• Government regulation 0.08 3 0.24
• Strong Competitors 0.09 4 0.36
• New Entrant 0.08 3 0.24
• Cultural Norms & Values 0.08 4 0.32
Total 1 3.56
31. Positions an organization’s various divisions in a
nine-cell display.
Similar to BCG Matrix except the IE Matrix:
› Requires more information about the divisions
› Strategic implications of each matrix are different
Based on two key dimensions
› The IFE total weighted scores on the x-axis
› The EFE total weighted scores on the y-axis
Divided into three major regions
› Grow and build – Cells I, II, or IV
› Hold and maintain – Cells III, V, or VII
› Harvest or divest – Cells VI, VIII, or IX
32. EFE : 3.56
IFE : 3.31
Therefore it will come under GROW AND BUILD cell.