GROUP 2

1. Jane Kartika Tjahjadi (2001839785)

2. Jessica Salim (2001841096)

3. Lim Dennis (2001840906)

Kimberly Clark Case Study

Kimberly-Clark (K-C) Corporation, a multinational consumer products manufacturer headquartered in

Dallas, Texas, is committed to using innovation to become an indispensable business partner. As a
leading global health and hygiene company, Kimberly-Clark’s brands, such as Kleenex and Huggies, are
sold in more than 150 countries. K-C has operations in 37 countries and employs more than 55,000
people worldwide, K-C announced the following results for 2009-2010:

 2009 4Q net sales increased 8% to $5.0 billion.

 2009 4Q cash provided by operations rose 48% to $1.0 billion.
 The company re-affirmed top and bottom-line growth objectives through 2015.

K-C Global Business Plan

One of the objectives of K-C’s global business plan was to build on its key capabilities of customer
development, innovation, and marketing to sustain grown rate. To achieve this objective, K-C
partnered with its large retail customers, such as Kroger, Safeway, Target, and Walmart. K-C
establishes mutually beneficial relationship with its retail customers, shares information and best
practices, and collaboration on new product development. Strengthening relationships with key
retail customers is essential to the company’s growth plans.

Aligning IT with the Strategic Plan

IT has become more strategically aligned as a result of four features:

1. R&D is an important functional area that works with IT for ongoing innovation.
2. Changing the organizational structure to lace senior-level IT Staffers into functional areas
engage IT in the creation of Business Ideas.
3. The portfolio approach, managed by the CIO, allows cross-functional opportunities to be
evaluated, with worthwhile ideas moved forward to the CEO for funding approval.

K-C recognizes that IT can improve relationships with retailers by helping them sell more products.
Specifically, IT can improve efficiency, effectiveness, and data collection and analysis. Delivering good
information to decision makers more quickly drives new ideas to improve the shopping experience
and develop new product concepts and innovations. Innovative approaches to assess consumer
shopping behavior bring insight to improve in-store designs and merchandising to encourage
purchases.

The Innovation Design Studio

- In may 2007, Kimberly-Clark opened its innovation Design studio which includes a life sized
3D virtual reality system.
 - In this simulated shopping experience, a virtual store takes on the look and feel of a specific
retail store.
- Consumers can ”walk through the aisles and shop” via a touch screen panel.
- As consumers react to different shopping environment or product packaging, sensors
embedded in the floors, walls, and ceiling, along with eye tracking technology, measure the
level of engagement to asses influencing factors on purchase decisions.
- K-C is also using the new simulation tools to elicit immediate customer feedback on new
product initiatives.

The Impact

- The innovation Design Studio helps K-C develop new product initiatives based on immediate
customer feedback, decreasing the time to market for introducing new products by 50%.
- Retail customers are able to create the most effective display design that sell more K-C
products.
- The introduction of a new line of K-C sun care products, Huggies Little Swimmers was
prompted by feedback to make the baby care aisle one stop shop for moms.
- The virtual reality technology however is delivering even more by providing retailers with
ideas on hot wo better sell other merchandise not offered by K-C such as clothing.
- The benefit to K-C is in image building as a technology innovatives, such as the use of RFID
for logistics.
- K-C plan of commitment to marketing, innovation, and customer development is working.
- The design studio is not only driving innovation but also helping K-C become a better partner
to consumers and to retailers.

Questions
1. Explain how K-C is managing its products as the retail level – in stores that it doesn’t own.

Ans. When K-C partnered with its large retail customers such as Kroger, Safeway,
Target, and Walmart. K-C establishes mutually beneficial relationships with its retail
customers, shares information and best practices, and collaborates on new product
development. Strengthening relationships with key retail customers is essential to
the company’s growth plans. K-C also aligning IT with the its strategic plan, K-C
recognizes that IT can improve relationship with retailers by helping them sell more
products, can improve efficiency, effectiveness, and data collection and analysis. IT
help delivering good information to decision makers more quickly drives new ideas
to improve the shopping experiences and develop new product concepts and
innovations.
2. How does the collaborating with its customers-the retails stores-improve its financial
performance? Contrast this collaborative approach to one in which K-C seeks to maximize
profits at the expense of the retailers.

By collaborating with its customers, which are large retailers, K-C can improve its
financial performance. Since they can share information, best practices and also
collaborates on new product development. Strengthening relationships with key
retail customers is essential to the company’s growth plans. While this might bring
 more benefits to K-C such as increased sales, on the other hand, it is not the case for
the retailers. The retailers actually have to do extra work due to the collaboration.
3. Why do retailers want to do business with K-C?

Retailers want to do business with K-C because they can establishes a mutually
beneficial relationships with K-C, where they share their information and best
practices, and collaborates on new product development, and strengthening
relationship with key retail customers is essential to their growth plans. and they
recognize that IT collaboration with K-C can improve their relationships and help the
retailers to sell more products. Lastly by partnering with KC on the new technology,
the retailers can gain some benefit such as:

i. Retail customers are able to create the most effective display design that
sell more K-C products
ii. Providing retailers with ideas on hot wo better sell other merchandise not
offered by K-C such as clothing
4. In your opinion does K-C ignore that competitive model(porter five force analysis) in favour
of collaboration?

In my opinion, K-C doesn’t ignore the competitive model of bargaining power of

supplier and customer, because by doing collaboration with their retailers, they can
produce and create a products based on the feedback of the customer instead. And
businesses are engaging in varied models of collaboration to improve their own, and
society's resilience, and one of them is by using technology to improve the
profitability and sustainability. Competition will stimulate innovation in sustainable
products, services and business models. However, In areas where big breakthroughs
are needed, collaboration is not a bad idea, especially if it can mutually benefit both
party, and in this case between K-C and their retailers.