Strategic Management Project

MNG 450

Al-Farsi Amal

Benjouida Soundouss

Harouni Alaoui Fatima-Zahra

Hormat-Allah Amal

Immes Salima

I. Company Overviewa) Historyb) Operationsc) P&G in Morocco

II. Issues & Outlook profile1. Mission Statement2. The Vision3. Values4. Objectives5. Current Strategies6. Strategic Issues

III. Analysis of the External Environment 1. Porter’s Five Forces Model 2. Links with Universities3. Links with Government4. Shareholders5. SWOT Analysis (Opportunities and

Threats)

IV. Analysis of the Internal Environment1. SWOT Analysis (Strengths and

Weaknesses)2. Strategic Cost Analysis

V. Development of Strategic Alternatives & Options

1. Leveraging Scale with the Retail Trade2. Corporate Leadership to Leverage Scale3. Leverage Scale with Specific Consumers

VI. Evaluation and Recommendations & Strategic Choices

VII. Strategic Implementation & Control Mechanisms

OUTLINE

I. Company Overview

a) History

• Procter & Gamble is an American global corporation based on manufacturing a wide range of consumer goods. As of 2007, P&G is the 25th largest US Company by revenue, 18th largest by profit, and 10th in Fortune's Most Admired Companies list.

• William Procter, a candle maker, and James Gamble, a soap maker, formed the company known as Procter & Gamble in 1837.

• The company prospered during the nineteenth century.

• Throughout the twentieth century, the company moved into other countries, both in terms of manufacturing and product sales, becoming an international corporation.

• In January 2005 P&G announced an acquisition of Gillette, forming the largest consumer goods company and placing the Anglo-Dutch Unilever into second place.

b) Operations

1. Beauty Beauty segment Grooming segment

2. Household Care Baby Care and Family Care segment Fabric Care and Home Care segment

3. Health & Well-Being Health Care Snacks, Coffee and Pet Care

c) P&G in MoroccoIn Morocco, P&G has started its activities in 1958 by the launching “Tide”. P&G strategy is to insure 70 million consumers will access to products of higher quality and affordable price.

P&G is present in Morocco through: 2 manufacturing sites in Casablanca and Mohammedia 7 distribution agencies throughout Morocco: Casablanca, Rabat, Tangier, Agadir, Marrakech, Fez and Oujda. 1 general office in Casablanca. 1 distribution center of 10 000m² in our Mohammedia site.

II. Issues & Outlook profile

1. Mission StatementWe will provide branded products and services of superior quality and value that improve the lives of the world's consumers, now and for generations to come.

2. The Vision“Be, and be recognized as, the best consumer products and services company in the world.”

3. ValuesIntegrityPassion for WinningLeadershipTrustOwnership

4. Objectives- Build existing core businesses into stronger global leaders- Grow leading brands, big countries, winning customers- Develop faster-growing, higher-margin with global leadership potential- Regain growth momentum and leadership in Western Europe- Drive growth in key developing markets

5. Current Strategies

1. Consumers will pay a premium for products that offer improvements over either private-label products or the brands they have bought for years.

2. Product innovation must be regular with visible improvements year constantly.

3. Product innovation must be designed to constantly "up-scale" consumer preferences.

4. This “up-scaling” of consumer tastes is not just for affluent consumers.

5. These strategies of innovation and pricing can be used to break into developing economies

6. Using innovation to attain a growing share of developing markets will be the key to growing company earnings as growth rates in mature consumer markets

Coke-P&G: a Failure Wrigley-P&G: a SuccessSoap Opera: Flash Back

6. Strategic Issues

- Family Care and Coffee categories have had substantial price competition and cost pressure.

- risks of over confidence and complexity

- Competitive pressure is a constant and consistent challenge

- Rising commodity costs

- Media fragmentation is another challenge

- Global economic and political instability

III. Analysis of the External Environment

1. Porter’s Five Forces Model

1. Buyer Power

2. Supplier Power

3. Threat of New Entrants

4. Threat of Substitutes

5. Degree of Rivalry

2. Links with UniversitiesOver the last few years P&G has been heavily recruiting the University of Minnesota, US for chemical & mechanical engineers.

3. Links with GovernmentBecause of P&G’s importance for the US economy, it can have a big say in the political arena, directly and indirectly, formally and informally. The voice of big multinational corporations is being heard, and they enjoy many privileges, such as tax rebates.

4. Shareholders•P&G can be divided in two categories: preferred shareholders & common shareholders

•25% of P&G stock in the world is in the hands of its employees.

5. SWOT Analysis (Opportunities and Threats)

Opportunities

1. Developing markets2. Gillette acquisition3. New products

Threats1. Uncertainty in pharmaceuticals business2. Increase in prices of raw materials3. Intense competition

IV. Analysis of the Internal Environment

1. SWOT Analysis (Strengths and Weaknesses)

Strengths1. Large scale of operations2. Strong branding3. Product innovation4. Developing markets infrastructure

Weaknesses1. Customer concentration2. Weak Performance of the Clairol business

2. Strategic Cost Analysis

Procter & Gamble instituted a "value pricing strategy" during which it boosted advertising while simultaneously curbing its distribution channel deals (in-store displays, trade deals), and significantly reducing its coupon promotions.

V. Development of Strategic Alternatives & Options (1/2)

1. Leveraging Scale with the Retail Trade

Everyone recognizes that retailers are becoming more and more powerful, demanding more price concessions from manufacturers while themselves marketing private brands of higher and higher value to consumers.

- Account-specific consumer research- Major theme events which make the retailer look good to their consumers - Multi-category consumer studies - Software analytics

V. Development of Strategic Alternatives & Options (2/2)

2. Corporate Leadership to Leverage Scale

Leveraging scale also means committing to ambitious corporate projects paid for from the top rather than requiring budget-constrained brands or divisions to commit their funds to projects too costly for them to consider.

3. Leverage Scale with Specific Consumers- focus on high-value consumer cohorts with intense needs. - generate the multi-category profit potential

VI. Evaluation and Recommendations & Strategic Choices

P&G’s foundation is household products. These are large businesses that are growing steadily and reliably generate earnings and cash. Overall company performance has been driven by these foundation categories for generations.

oIn order to apply our strategies, P&G should stay focused on their customer’s needs and wants and continue to deliver high value products and customer service.

o Because there are so many different forms of media available today, targeting markets through specific Medias’ can be a challenge.

o Learn locally but act globally.

o Organize around multi-functional teams.

o Build capabilities to serve lower-income consumers who are not buying and using P&G products on a regular basis today.

VII. Strategic Implementation & Control Mechanisms

-Implement quality control throughout all of their business units.

-Improve communications between management and the different business units.

-Invest heavily in research and development and market research.

-The marketing department should work extensively with data mining technology in order to learn about their customer base

-Benchmark against competitions marketing campaigns.

-P&G should also invest in risk management for each of the main regions.

- Hire local financial experts in each of their operational regions.

Thank You