Procter and Gamble Strategic Management

Procter and Gamble Strategic Management

Strategic management is essential in the complex world of business, where things change rapidly. It entails the analyses, the decisions, and probable actions taken by an organization for purposes of creating a sustainable competitive position (Dess et al. 2019). The complex business world brings with it stiff competition from competitors where companies must implement new initiatives and make significant changes in their strategies to remain competitive. However, in the course of strategizing and formulating ambitious actions, things become worse than they were, and business crumble. Therefore it is crucial to carry out the various strategic management process which helps in identification, evaluation, recommendation, and implementation regarding the fundamental Problems, critical and strategic issues arise in the market.

Procter and Gamble, once a leading global consumer product, faces the implications of operating in a complex and competitive market. To retain its iconic brand name and improve its sales, which recently have stagnated must identify the fundamental problems, critical issues, and strategic issues requiring implementation (Dess et al. 2019). The significant problems facing P&G’s are; Sluggish global economy, competition from global competitors with cheap products, the adaptation of new technology.

Since its foundation, the company rose to the status of the most iconic and well-known consumer products. However, after the recession, consumers opted for cheaper products offered by the competitive markets. Therefore the sluggish global economy has disadvantage the company with its products, reducing its sales. Consequently, it ends up generating more for its stakeholders while also having conflicting ideas on the adaptability of innovation through their company culture of having innovations driven by employees and stakeholders’ interest and not customer-centered ones. Through these, they end up making products that do not compete well in the market. For instance, the sales of its 18 top brands slowed, facing competition from more lethal and focused Kimberly-Clark and Colgate –Palmolive (Dess et al. 2019). These problems lead to failure to meet the customers’ needs and economic changes. These require assessing critical issues raised by these problems. The key critical issue facing the company include Changes in management, the Obligation of the company, boosting employee morale. Changing the control of the company has cost the company a lot since each new executive member comes with their objectives. Under Lafley, the company had 25 brands in the market, generating almost $1 billion in sales.

However, under Bob McDonald’s growth stalled due to recessions with its premium-priced products became abandoned for the cheap ones causing Laftey to come back, creating an objective of growth and a more reliable generation of cash and profit. However, Taylor disregarded the goal. He   Made the company continue making fewer sales. Also, the company is more obligated to its stakeholder than the consumer interests evidenced by much more need for profit-making to raise their dividends than the need to generate a product motivated by the consumer interests (Dess et al. 2019). However, the company problem is the lack of morale and the brain drain of the employee. Most of the top levels retire or even move to rival companies hindering the innovation process of the company and generating skilled managers, which led to recalling Lafley since his successors had no skills.

A more concern issue falls under the strategic problems of aligning the goals and objectives of the company, determining the nature of the goals whether to invest in long-term or short term initiatives or even adaptation of active and efficacy technology. The lack of P &G’s to speculate and inform its goals and objectives brings about changes from the management shift, with each implementing a new initiative. Also, the confusion of whether the purpose or objectives should provide a long term or short term result affects the company management strategy and operations (Dess et al.,2019). Also, the insist on generating innovation from outside the company makes their technology ineffective, and the efficacy of it becomes a problem since the aligned goals, objectives, and obligations affect the morale of the works making internal innovation difficult.

However, in solving the problems, the company needs to provide an alternative to each problem, critical issue and strategic issues.

• Become consumer-centered.

Through centering its objectives on meeting the consumer needs, the company becomes able to come up with products that customer requires (Dess et al., 2019). For example, under Lafley, programs of producing brands that meet the customer needs and improve their experiences were adopted (Dess et al., 2019). In the changing periods and competition, products also need to change with the times and not produce the same way they created in the previous generations.

• Create a culture of innovation and leadership.

Through creating a culture of innovation, the company motivates the worker and makes them involved and prevents the migration of the skills. Also, the company needs to come up with programs that boost the worker’s ability and qualifications and ensure that each is capable and equipped with the right skills before employment.

• Start expanding its operations and brands.

Through expanding operations, the company widens its market and also calls for the production of more competitive goods and superior ones than the competitors, such as shifting away from the creation of essential commodities to more advanced ones.

However, for the company to succeed in all its operations, it requires to have the right leaders in leadership positions. Aligning the interest of the stakeholders is also a very crucial element in the growth and development of the company. The conflicting interests of the stakeholders make the implementation of critical objectives difficult. However, a more approach needs to get adopted to provide a culture of producing with consumer interests driven from carrying out data and information analysis of the products in the market.

Reference

Dess et al. (2019). Strategic management (9th ed., pp. 50-670). New York: McGraw-Hill Education.