Introduction

Study the given case analyses of strategic management at Procter & Gamble and Unilever.
Objectives of the study

Question 1: Compare and contrast each company’s business model.

Unilever and Procter & Gamble Company
Contrast Business Models

Customer
profit value
proposition Unilever Procter & Gamble (P&G)
or Profit
fomular

Customer Unilever’s main value proposition is its Procter and Gamble provides value to
value branding as a provider of quality goods at consumers through its range of quality
proposition
reasonable prices. Its scale allows it to products, its customer service and its
produce goods at relatively lower cost while reputation as a reliable manufacturer. The
maintaining quality. Its scale also allows Company provides products that cater to all
access to niche markets, particularly in customer segments, including some of the
developing countries. This means that the world’s most popular and respected consumer
same Unilever products may be found on brands.
shelves in the US and in provision stores on Procter and Gamble’s broad range of high
the streets of Thailand. This coverage gives quality products, and its reliable supply chain
Unilever a strong branding, driving sales. and distribution operations, also create value
That said, Unilever owns a significant number for its retail and distribution customers in the
of brands, each with its own unique value form of revenue and sales.
proposition. For example, Magnum is known
for providing quality ice-cream at premium,
but not unreasonable, prices. On the other
hand, Knorr is known for providing household
items, such as stock cubes and sauces, at very
inexpensive prices. The consistent narrative is
that Unilever products are of high quality, are
well designed and effective, and are provided
at a price fitting their target customer and use.

Profit Unilever’s key revenue streams are from its
Formula four business segments. Personal Care
accounts for a turnover of €20.1 billion,
accounting 38% of the groups’ turnover and
48% of its operating profit. Foods accounts
for €12.9 billion turnover, 24% of the group’s
turnover and 31% of its operating profit.
Home Care accounts for €10.2 billion
turnover, 19% of the group’s turnover and
10% of its operating profit. Refreshment
accounts for €10.1 billion turnover, 19% of
the group’s turnover and 11% of its operating
profit.
Procter and Gamble generates revenue through
the manufacture and sale of consumer goods to
retailers, mass merchandiser and distributors.
Its operations are divided into five business
segments, which contribute varying amounts to
overall annual revenue: Fabric Care and Home
Care; Baby, Feminine and Family Care;
Beauty, Hair and Personal Care; Health Care;
and Grooming.
Of the Company’s $76.3 billion in revenue in
fiscal year 2015, the sale of Fabric Care and
Home Care products accounted for 29%, Bay,
Feminine and Family Care products accounted
for 26.5% and Beauty, Hair and Personal Care
products accounted for 23.8%. The remaining

Profit Cost structure is comprised of production (i.e.
formula raw and packaging material and goods
purchased for resale), staff costs, distribution
costs, and selling and administrative expenses.
Profit Profit margin depends on the
formula sale of consumer goods
four business segments: Personal Care, Foods,
Home Care, Refreshment
to cover costs and provide profits
Q2: Evaluate the effectiveness of the strategies formulated by each company to
gain sustainable competitive advantage and growth
Indicators Proctor & Gamble
Procurement & Sourcing Has focused on ways to improve
supply chain efficiency and costs=>
Now achieve a powerful industrial
network linking electronically to
major suppliers and customers.
Technology development Spend $2 billion every year on R&D;
establish an Intranet to generate
synergy for new product ideas and
product development.
Human resource Use information systems which new
management employees could link to experts,
learn from projects and receive
answers to questions.
revenue was shared relatively evenly between
its remaining business segments.
Cost structure is comprised of –salaries and
benefits, fixed costs rental and utility costs in
relation to the operation of its worldwide
network of offices. Also, the cost of sale,
manufacturing. The Company accrues
significant advertising and marketing costs.
Profit margin depends on the
manufacture and sale of consumer goods
five business segments
Fabric Care and Home Care; Baby, Feminine
and Family Care; Beauty, Hair and Personal
Care; Health Care; and Grooming
to cover costs and provide profits
Unilever
160,000 suppliers, 273 factories and
equip 500 sites and offices in 190
countries. Responsible sourcing
policy & commitment to on-shelf
availability drives growth.
Spend $1 billion every year on R&D.
There is a Strategic Science Group,
designed to predict evolving science
trends, identify opportunities and
deliver growth through innovation.
• Unilever Leadership Development
Programme which aligns the personal
development plans and careers of
senior leaders

Firm Infrastructure Not found
Operations 5 business segments: Fabric Care and
Home Care; Baby, Feminine and
Family Care; Beauty, Hair and
Personal Care; Health Care; and
Grooming.
Marketing & sales • Spend about $7.1 billion every year.
• Apply information technology to
marketing.
Inbound logistics
Outbound logistics Largest customer was Wal-Mart that
had a reputation for requiring
suppliers to coordinate their supply
chain processes with its powerful
just-in-time continuous inventory
replenishment system.
Softwares • Using product lifecycle
management software.
• MatrixOne software for
mechanising and automating.
Service
Q3: Recommend, with validated critical reasoning, strategic actions P&G could
take to strengthen competitive position and profitability.
Procter & Gamble Company
Retain the competitive advantage and achieve the market growth, business organization have to achieve the
customer loyalty by providing quality products in a low price (Dyson, 2010). The company should utilize
• “Talent and organisation readiness”
assessment programme to recruit and
train people with the right skillsets
• Hold a global “Winning with
Integrity' comprising of surveys and
interviews regarding human rights. It
encouraged the suppliers of Unilever
to operate to the standard set by the
company.
The good management of Unilever
planning & financing also add values
for their customers and stakeholders
Network of more than 240
manufacturing sites in the world:
- Sustainable network
- Global scale operations
- Agility to meet demand
Spend $8 billion every year to build
customer loyalty & relationships,
brand equity & increase
competitiveness of brand.
Lean Logistics centralized inbound
logistics system that increase:
- Efficiency
- Standardization
- Cost-effectiveness
Global network, savings, efficiency
(22% reduced CO2 emissions,
improved customer service).
Work closely with customers to
ensure quality service. Joint
sustainability programmes with key
customers.
 the new market segments for gaining profitability. P&G should utilize their strengths in the R&D sector for
developing the technological resources. The full utilization of financial sources will help to invest more on
for the product innovation and starting venture on the new market. With the implemented strategy,
government regulations and law should be maintained by the Procter & Gamble. The company should take
the environmental sustainability program for the sustainable development of the company. To implement the
strategy effectively, innovation and knowledge about the current issues is extremely important. The decision
making authority should be decentralized for the easy and fast decision marketing process (Goksoy &
Ozsoy, 2010).

Unilever’s Actions
1/ Political Factors:
Political difficulties in Europe, we can negotiate and use the cooperation between corporate leaders and
politicians to grow Unilever stability. If the political factors in that countries is highly difficult so that
Unilever needs to decrease the level of investment (low risk).
2/ Economic Factors:
Currently, the big companies are implementing factory set at the national and local low-wage
employees. Unilever's recommendation for increased search and labor market surveys in the country, based
on data from wage growth of local people and conduct factory investment => Low-cost strategy to increase
Unilever profit.
3/ Technological Factors:
In partnership with the major technology companies, collect consumer data and consumer habits of
customers, from there take out tactical and reasonable products, avoiding the wasted cost of Research and
Development.
4/ Environment Factors:
If the current plastic is frustrating problems of society, then Unilever should do research and develop on the
product no packaging or packaging but there are biodegradable in nature (creating a trend about
environmental factors and also leading a marketing campaign) => Differentiation strategy.
5/ Unilever weakness:
Unilever's weakness is the lack of diversity in products. Therefore, Unilever should look at competitors, who
have products that are more attractive to customers, using resources to be able to create a similar product or
create more product line.
6/ Unilever threats:
With problem product imitation, we need to identify clearly which areas are product appearance imitation,
focus on that area, instead of packaging and design constantly, more beautiful, more suitable to customers
for them to avoid confusion. Marketing and increase level of royalty client's to Unilever products.

Q4: Assess the likely impact of organizational culture, organizational structure

and operations management on strategy execution at each company.

1. PROCTER & GAMBLE

Organizational culture/
Structure/ Operation Importance
Management Weight PROCTER AND GAMBLE CO.

Impact Measurement
Features Impact Weighted
rating Score

1.Organizational Cutlture  Purpose-driven organizational culture

 Characteristics:
- Trust
- Integrity: involves the principles of mutual respect,
personal mastery, and innovativeness among P&G
employees; encourages workers to ensure beneficial
 impact of the consumer goods business on its external
environmen
- Leadership: pushes P&G employees to achieve
leadership in business direction and in individual and
organizational output; optimize strategy implementation
and fulfillment.
- Ownership: Individual employees and their groups
behave like owners of the business, thereby ensuring
strategic success in the process
- Passion for Winning: compel employees, especially
leaders to obtain the excellence as well as motivating
employees to continously improve to better support the
business goals
Quality/ product performance 0.15 9 1.35
Reputation/Image 0.20 8 1.6
Efficiency Distribution 0.1 10 1
Network
O Operation 0.05 3 0.15
Strong Consumer Good 0,05 6 0.3
Brands
New-product Innovation and 0.1 7 0.7
Development Capability
Financial performance / 0.15 9 1.35
Financial Growth
Customer service/ Customer 0.15 Procter & Gamble share holder equity for the 6 0.9
relationship quarter ending December 31, 2018 was $54.443B,
(External + Internal) a 0.51% declineyear-over-year.
Quality of Output 0.05 7 0,35
Sum of impact rate 0.1
Weighted overall rating 7,7

Organizational culture/
Structure/ Operation Importance
Management Weight PROCTER AND GAMBLE CO.

Impact Measurement
Features Impact Weighted
rating Score
 Organizational Structure: Product-type
2.Organizational Structure and divisional organizational structure including:
-Product-Type Divisions:
Operation 1. Beauty; 2. Grooming; 3. Health Care; 4. Fabric &
Home Care; 5. Baby, Feminine & Family Care
- Geographical Divisions:
1. North America; 2. Europe; 3. Asia Pacific
4. Greater China; 5. India, Middle East and Africa
(IMEA); 6. Latin America
- Functional Groups: 20 groups includings
1. CEO; 2. CFO/Finance; 3. Global Health Care
4. Global Fabric and Home Care and Global Baby and
Feminine Care; 5. Global Family Care and Global Brand
Creation and Innovation, P&G Ventures; 6. Global Beauty
7. Global Grooming….
 Operational Management
1.Design of Goods and Services; 2.
QualityManagement
 3.Process and Capacity Design; 4.Location Strategy
5.Layout Design and Strategy; 6.Job Design and
Human Resources
6.Supply Chain Management; 7.Inventory
Management
8.Scheduling; 9.Maintenance
Quality/ product 0.05 6 0.3
performance
Reputation/Image 0.15 7 1.95
Organization Operation 0.2 9 1.8
Efficiency Distribution 0.12 Procter & Gamble revenue for the quarter ending 10 1.2
Network December 31, 2018 was $17.438B, a 0.25%
increase year-over-year.
Strong Consumer Good 0.1 9 0.8
Brands
New-product Innovation and 0.05 5 0.25
Development Capability
Financial performance / 0.05 6 0.3
Financial Growth
Customer service/ Customer 0.1 7 0.7
relationship
(External + Internal)
Asset and Liabilies 0.1 Procter & Gamble total assets for the quarter ending 6 0.6
Managment December 31, 2018 were $123.687B, a 2.33%
decline year-over-year.
Sum of impact rate 1.0 7.9
Weighted overall rating

2. UNILEVER
Organizational culture/
Structure/ Operation Importance
Management Weight UNILEVER CO.

Impact Measurement
Features Impact Weighted
rating Score

3.Organizational Cutlture  Culture of Performance, which

emphasizes the significance of employee
output
 Characteristics:
1.Focus on performance – individual
performance and organizatio
2. Focus on quality – quality of output in all
areas
3. Efficiency – efficient work through
technology and other tools
-Type of approaches: market-based and result-based
management
Unilever’s leadership-based approaches support the
integrity of corporate culture implementation,
especially in mergers and acquisitions.
Quality/ product 0.15 8 1.2
performance
Reputation/Image 0.15 8 1.2
Efficiency Distribution 0.1 Underlying Sales Growth averaged 3.3% over five 7 0.7
Network years with 2.9% in 2018, 3.1% in 2017, 3.7% in
2017
Organization Operation 0.05 6 0.3
Strong Consumer Good 0,05 7 0.35
Brands
New-product Innovation and 0.1 5 0.5
Development Capability
Financial performance / 0.3 - Turnover growth averaged 0.6% over five years 10 3
Financial Growth With 5.1% in 2018, 1.9% in 2017, 1.0% in 2016
Customer service/ Customer 0.15 8 1.2
relationship
(External + Internal)
Quality of Output 0.05 9 0,45
Sum of impact rate 0.1
Weighted overall rating 8,9

Organizational culture/
Structure/ Operation Importanc
Management
Weight
Impact Measurement
4.Organizational Structure
and Operation
Quality/ product
performance
Reputation/Image
e UNILEVER CO.
Features Impact Weig
rating hted
Score
Organizational Structure A product type divisional
organizational structure.
main characteristics of Unilever’s organizational structure:
1. Product type divisions (most significant feature)
An advantage of this structural characteristic is its
facilitation of the company’s efforts to apply product
differentiation
 Personal Care
 Foods
 Home Care
Refreshment
2.Corporate executive teams
based on business functions
1. Chief Executive 2. Human Resources 3. Research
& Development 4. Supply Chain 5. Refreshment 6.
Personal Care 7. North America 8. Home Care 9.
Finance 10.Legal 11.Foods 12.Marketing &
Communications 13.Europe
3. Geographic divisions (least significant feature)
he company uses this structural characteristic to support
regional strategies
1. Asia/AMET/RUB (Africa, Middle East, Turkey; Russia,
Ukraine, Belarus)
2. The Americas
3. Europe
0.05 7 0.35
0.1 8 0.8
Organization Operation 0.15 7 1.05
Efficiency Distribution 0.15 6 0.9
Network
Strong Consumer Good 0.1 7 0.7
Brands
New-product Innovation and 0.3 10 3
Development Capability
Financial performance / 0.2 Underlying operating margin has steadily increased over 9 1.8
Financial Growth five years from 15.5% to 18.4% with 18.4% in 2018;
17.5% in 2017 and 16.4% in 2016
Net profit is $6.486 million in 2017 and $5.547 million in
2016
Customer service/ Customer 0.1 9 0.9
relationship
(External + Internal)
Asset and Liabilies 0.05 Underlying volume growth averaged 1.3% over five years 6 0.3
Managment With 1.9% in 2018, 0.8% in 2017 and 0.9% in 2016
Sum of impact rate 1.0 7.1
Weighted overall rating

Q5: Recommend, with validated critical reasoning, other viable managerial

actions each company could take to support their respective strategy execution
efforts
P&G have continuously focus on their core businesses and brands by keep growing core brands and
categories since they see it as the primary way to touch and improve lives. The company must strengthen its
competitive advantage and business capabilities in the consumer goods market. The following are
recommendations to support their respective strategy execution efforts facing Procter & Gamble:
- Develop P&G’s competitive advantage through innovation and technology. P&G had to
become a more consistent operator, and a much more consistent and reliable innovator.
- Expand e-commerce operations to exploit online market growth. They have also place an
importance on keeping consistency in areas such as maintaining and increasing their presence in developing
market.
- Diversify by entering new industries to minimize Procter & Gamble’s market-based risk
exposure, extending distribution systems to reach more consumers through undeserved retail channels and
expanding brand and product portfolio.
—————————-
Unilever is one the most successful multinational corporation covering
almost all the countries in the world. The history of excellence and success has
given Unilever the position of a pioneering legend. They have paved the way
for many corporations around the globe. All this success doesn't mean
Unilever doesn't face any problems or doesn't have any shortcomings. The following are recommendations
to support their respective strategy execution efforts facing Unilever:
⁃ Better align business processes with said policy. Some suppliers and regional partners are still
a little vague about some policies.
⁃ Apply changes specific to the operations in a particular country. Rather than using a general
one, Unilever should improvise country-specific strategies.
⁃ Being a global company it needs to operate according to local preferences. Some products
still need local touch for the consumers in that area.
⁃ Continuously improve the strategy to maintain its level over the local competitors.
⁃ High concentration on Emerging markets. Because emerging markets have huge potential.
⁃ Ensuring that Unilever meets the same standards expected from its suppliers.
 ⁃ Needs to launch more advertising campaign to promote Unilever Sustainable Living Plan to
the consumers.
⁃ Improving the products according to the Unilever Sustainable Living Plan strategy.

References:
Company Unilever. (n.d.). Retrieved from https://www.cleverism.com/company/unilever/

Company Procter & Gamble. (n.d.). Retrieved from https://www.cleverism.com/company/procter-gamble/

Annual Report and Accounts 2018 Highlights. (n.d.). Retrieved from https://www.unilever.com/investor-
relations/annual-report-and-accounts/
Procter & Gamble Financial Statements 2005-2019 | PG. (n.d.). Retrieved from
https://www.macrotrends.net/stocks/charts/PG/procter-gamble/financial-statements

Making Sustainable Living Common Place - Unilever Annual Report and Account 2017. Retrieved from
https://www.unilever.com/Images/unilever-annual-report-and-accounts-2017_tcm244-516456_en.pdf