Procter & Gambler: Organisation

Alternative structures such as grouping by output/product or grouping by market are not options as they would result in “duplication of activities and resources, the erosion of deep technical expertise, missed opportunities for synergies and learning” (Ancona, Kochan, Scully, Van Maanen, & Westney, 2009, p. M2-19). The matrix structure provided a potential positive aspect in that it would provide a needed cross-functional linking mechanism by mixing the functional structure with grouping by output/product, but the complexity, cost, dual systems, and dual roles resulting from the matrix structure historically resulted in either the functional or the output/product system becoming more powerful than the other.

Lastly, the matrix structure is a combination of the functional and multidivisional structures (Rothaermel, 2013). It is most appropriate when an organization needs a structure which allows for both centralized and decentralized decision-making, and can be organized by geographic areas and product divisions (Rothaermel, 2013). While a global strategy does not automatically lend to a matrix structure, a transnational strategy which has the requirements above is better served through a matrix structure (Rothaermel, 2013).

P&G – Procter & Gamble is a consumer product company founded and headquartered at Cincinnati, Ohio in 1837 by Mr. William Procter and Mr. James Gamble. It is now led by Mr. Alan.G.Lafley whom rejoins the company in 2010.

The Daniel Gill, the chairman and CEO faces the possibility of changing the organizational structure of Europe, Asia/Pacific, and the Western Hemisphere. The current organization includes an International Division which oversees production and marketing for countries outside the United States. The goal of changing the organizational structure of these three regions is to increase sales growth internationally and decentralize responsibility away from headquarters to field operations.

When it comes to business as any organizations it requires a structure, based on the resources and demands organization can changed or modify their structure. The most common two structures are vertical and horizontal structure which we see every business organization in global market (Bateman & Snell, 2011). In today’s any business organization theirs and important trait is not only the structure, it is the functions within the organization. An organizing function in management highlights the practices individuals use to interact and work with each other. There are many business organizations that are very successful in their own

The Procter & Gamble business strategy is to focus on creating new brands and categories so the company can focus on being the best in branding, innovation and scale. This is what sets this company apart from many of its competitors. The Proctor and Gamble are the global leader in all of their core businesses within the company which consists of laundry, baby care, hair care and feminine protection. This report is designed to understand the company’s business model and strategies, and analysis how the P&G has formulated its business-level strategies to pursue its business model.

P&G set up the newly reorganized global operations. I’m going to explain how the company works with its new global operations strategy and how P&G could push SK-II to world brand by using P&G’s target market – China, Europe, and Japan. By using the implement of Organization 2005 (O2005), the company is expected to have more annual growth rate together with less expense. P&G gives more compensation along with more responsibility tasks. P&G allows every employee in company to hold firm’s stock. P&G transferred primary profit responsibility from P&G four regional organizations to seven global business units.

The primary purpose to launch Organization 2005 program was to boost product innovation and facilitate the global rollout of new products. It was expected that product innovation and new products would be causing a major boost to the staggering sales and to profitability. Organization 2005 did offer acceleration in business with increase in sales as well as profitability. But immediately after there were continuous quarters with increasing rate of falling profitability and consequent stock prices for P&G. The major reasons for this were:

Historically P&Gs innovation strategy was focused on its internal capabilities. The company had minimal experience externally and was not involved with its competitors. The model used by the company was a traditional stage gate model (Heimberg, 2008). This model (See appendix 7.5) helped P&G until 2000 when the company faced major financial difficulties. With the increase in the pace of innovation, costs, fast followers, constrained resources and more consumer demands the traditional model was unable to deliver the required results (Heimberg, 2008). The company required a "growth rate which exceeded the industry growth rate”. This

On June 5th of 2013 P&G announced that company is going through some change and made decision to group its Global Business Units (GBUs) into four industry-based sectors. Task of each of these sectors will be concentrated on share of common technologies, common consumer benefits, and face common competitors. These four industry-based sectors will be focusing on strengthening of already developed market business, maintenance of developing market momentum, production of a strong innovation pipeline, and drive of productivity improvements. Such changes, announced by P&G are not rare for company and will not be that sensitive by employees or other stakeholders.

Introduction: Procter & Gamble , Also known as P&G is an American multinational consumer goods company. The headquarters of P&G is in Ohio, USA. It was founded by William Procter & James Gamble, both of them are from United Kingdom.

The marketing team was still uncomfortable with the GBU guidelines, so they have to decide between:

As time goes on, the whole company’s segments have replaced with three major Global Business Units.

The Group is organised into the four operating divisions Post - e-commerce - Parcel, Express, Global Forwarding, Freight and Supply Chain, whose products and services we describe in the Business units and market positions chapter. Each of them is under the control of its own divisional headquarters and subdivided into functions, business units or regions for reporting purposes. They consolidate the internal services that support the entire Group, including Finance, IT, Procurement and Legal, in Global Business Services (GBS). This allows them to make even more efficient use of their resources whilst reacting flexibly to the rapidly changing demands of the business and customers.

 The reengineering efforts also required restructuring of the organization. P&G had been known for its brand management for more than 50 years. But in the late 1980s and early1990s, the brand management approach pioneered by the company in the 1930srequired rethinking and restructuring. In a drive to improve efficiency and coordination, several brands were combined with authority and responsibility given to category managers. Such a manager would determine overall pricing and product policies. Moreover, the category managers had the authority to withdraw weak brands, thus avoiding conflict between similar brands. They were also held responsible for the profit of the product category they were managing. The switch to