Maruti Suzuki India's Foray into Africa
Code : COS0110 Industry :Consumer Packaged, Fast Moving Consumer Goods Organization:The Procter & Gamble Company. |
Period : 2009-2013 Region : India, Africa and Europe Countries : US |
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Background NoteFounded in Cincinnati in 1837 by William Procter, a candle maker, and James Gamble, who made soaps, P&G grew from a soap and candle supplier to become the world’s biggest consumer goods manufacturing company . The company celebrated its 175th anniversary in the year 2012. In 2005, P&G acquired Gillette Co, the maker of razors, shavers and battery for $57 billion. This was considered as one of the biggest deals of the time. In 2012, the company was ranked 35th on the Forbes list of Global 2000 Companies and 27th on the Forbes list of Most Innovative Companies . By the end of the year 2012, the company had operations in over 180 countries across North America, Latin America, Europe, the Middle East and Africa, and the Asian region. P&G was a very diverse company in its product offerings.... Losing To Competitors Commenting on P&G’s performance for the fiscal year 2012, market analysts opined that organic sales had not grown according to the earlier projection made by P&G. P&G had projected that organic sales would grow at 5 per cent for the fiscal year 2012 . Earlier on June 20, 2012, at the Deutsche Bank global consumer conference, P&G lowered its Q4-2012 earnings and also revenue forecasts due to the slowdown in global economic growth . This was the second cut in a row in a short span of three months. Earlier in February 2012 too, P&G had lowered its projection. After lowering its revenue projection in February 2012, McDonald reiterated that he was doing a rethink on the decision to expand into developing markets and that P&G would refocus only on its main markets. ... |
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What Went Wrong At P&G ? When McDonald took over from Lafley in July 2009 to accelerate P&G’s business, he went on to promote the ‘purpose-inspired growth strategy’. The strategy focused on three specific choices – first, to grow P&G’s leading global brands and core categories with an unrelenting focus on innovation; second, to build P&G’s business with unserved and undeserved consumers; and third to continue to grow and develop faster-growing, higher-margin business with global leadership potential . The strategy was advocated for all of P&G businesses around the world. It also aimed to gain market share by winning millions of new customers in both new and existing markets while continuing to expand the range of existing brands . ...
William Ackman's Pressure McDonald felt the heat when activist investor William Ackman’s (Ackman) Pershing Square Capital Management LP bought about 27.95 million shares of P&G (about 1.02% of P&G Stocks) in July 2012 , . Ackman was an American hedge fund manager and a long-term value investor known for taking advantage of the short-term downward moves in prices. He built stakes in companies and then as a big shareholder, agitated for changes in the companies and boosted the value of their holdings. Ackman’s purchase of stake in P&G indicated to the outside world that the once esteemed stock had lost investors’ confidence in it since McDonald had taken over....
Lafley Vs Mcdonald Lafley started working at P&G in 1977 in marketing, as brand assistant to dishwashing liquid product ‘Joy’. Before becoming CEO in June 2000, he was President, global beauty care and North America . His dramatic appointment as CEO in June 2000 was similar to his being called to take over from McDonald in May 2013. Lafley was called in June 2007 while on assignment in California by the then Chairman of the Company John Pepper and asked whether he was ready to accept the CEO job at P&G. As a sailor on the front, he accepted the post. He replaced Durk I. Jager (Durk Jager), who was ousted after being in the seat for a year and half....
Can the Magic Wand Work ? Hal Gregersen (Gregersen), senior affiliate professor of Leadership at INSEAD, opined that Lafley’s innovation skills would help P&G weather the storm . Expressing his opinion on Lafley’s innovation skills, Gregersen said that leaders like him generated valuable disruptive ideas and engaged their innovations skills daily. Gregersen added that Lafley had unwavering devotion in understanding how consumers lived and felt and that he had sharpened his innovation skills through facing nonstop challenges while working in Japan and Asia, when P&G struggled in some of those markets, before taking over as CEO in June 2000. Commenting on Lafley’s return, McCormick said that his legacy might be jeopardized if he did not act quickly and decisively. ...
