The Procter and Gamble was found by William Procter and James Gamble in the year 1837 as producers of candles and soap, the world’s top producer of household products courts market shares and billion dollar names. It was divided into three global units which were the beauty and grooming, health and well-being and household care.
The business talked about how the two persons Drug I. Jager and Alan G. “A.G.” Lafley showed their leadership as Chief Executive Officer (CEO) in the company during their term. The story of P;G ran in the ups and downs of the company and how Lafley restored the company from the declining rate of P;G from the leadership of Jager.
At first Lafley became stressed and pressured for what Jager has done in the company to the point that their sales decreased and declined and they reduced their employees and cutting cost.
The company under Lafley’s leadership took a long process; they experienced sacrificial moment and they need to take a risk and undergo into hard decisions. Lafley created strategies in order to make the company restored and those moves have helped him found a balance between sales and profit growth. Electric toothbrush (SpinBrush) was the product that made the company refocused on the big brands that drove earnings, including Tide, Pampers and Crest.
Yates, a financial manager on the Crest brand, headed a team and evaluated SpinBrush. He used a nice strategy which he broke the biggest rule of all for a company. He didn’t advertise SpinBrush for the first seven months but resulted very good that the P;G is sold SpinBrush in about 35 countries marked its quickest global rollout ever.
One of the problems identified in the P;G is the share price slid 52%, cutting P;G’s total market capitalization by 85 billion dollar. The reason of this; most of people don’t buy their products. It’s either they change their brand or maybe they don’t like the product anymore.
Second, the family turn against its leader for a reason that the company were declining and the capitalization decreasing, employees and retirees hold about 20% of the stock. Many employees would lose work and salaries in which they couldn’t their basic needs for their families.
Third, Lafley is under enormous pressured to return P&G to what it consider its rightful place in Corporate America. Because of what Jager has done before Lafley take over the position as Chief Executive Officer (CEO) in the company. P&G lose their capitalization and slowly declining. Lafley was pressured because the Procter and Gamble Company before is very well known in the America and a world’s top maker of a products of the beauty and grooming, health and well-being and household care. He is pressured to return the company’s tittle in the America.
Fourth, earnings per share roused by just 3.5% instead of an estimated 13% because of what Jager has done he missed forecasts twice in six months. The estimated percentage that must be reached by the company do not reached that caused of having a low income. Maybe because of the target customers are tired in buying their product for a reason that there’s no innovation in the products and maybe the product that was selling by the P;G do not reached the satisfaction of the customers.
Fifth, P;G has missed a big opportunity: It passed up to the chance to buy water soluble strips that contain mouthwash. The company couldn’t buy a water soluble strip that contains mouthwash because of insufficient money to buy it, although they want to have it, they have no option to own it because they lack of money for it.
Among those problem aroused in the Procter and Gamble that was identified in the company the main problem of P&G was how the company restore the trust and high rate of P&G in the America; how they could bring back the tittle of the company and reached the high capacity of having high capitalization in P&G.
Lafley is under enormous pressured to return P&G to what it considers its rightful place in Corporate America. He tried many things and strategies to find solutions in the problems that are aroused in the company. He takes risk and undergo in difficult decision. He sacrificed something in the company and exerted more effort to make the company alive and save from the declining rate of the P&G.
In solving those problems the P&G share price slid 52%, cutting P&G’s total market capitalization by 85 billion dollar, family turn against its leader, Lafley is under enormous pressured to return P;G to what it consider its rightful place in Corporate America, earnings per share roused by just 3.5% instead of an estimated 13%, and P;G has missed a big opportunity: It passed up to the chance to buy water soluble strips that contain mouthwash.
P;G should make a survey how people could catch up in a product that they will go to buy. P;G must look for a new trend which people love to buy, then renovate it and come up to a new product.
In P;G, look for some strength of the company and make use of it to as a first step to make the business alive then aside from looking the advantages, look also for the opportunities that could serve as your another step the find the disadvantages and problems in the company and study about it and create good moves.
In terms of the capitalization first, P;G would accept the reality of having a low percentage, then from the money they have, they should change their tactics and create another flow chart to follow as a guide in marketing their sales. Second, make a new strategy that unusually done by the other competitors. And be resourceful; as of now, it’s because they received a low income in the product.
When it talks about the product maybe they should change the packaging, the style and make the product much presentable and much comfortable that could lead the costumes satisfy in the product.
When we talk about the employees, Lafley reduced their workers in the company for a reason that they have low capitalization. And as the result the family turn against its leader. So, the solution is to make a contract with them that when the company will rise up again and restore the company’s high capitalization and their product become in demand again in the market, they will be automatically inform them to work again in the company.
Berner, R. (2003). P;G NEW AND IMPROVED How AG LAFLEY is revolutionizing a bastion of corporate conservatism. Business Week, (3840), 52-52.
Berner, R. (2002). Why P;G’s Smile Is So Bright. Business Week Online,