Strategic Management in P&G

3. PROPOSED VISION
Our vision is to work with our employees and business
partners in order to provide products that improve the
daily lives of consumers across the world.

4. MISSION
We 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. As a result, consumers
will reward us with leadership sales, profit and
value creation, allowing our people, our
stakeholders and the communities in which we
live and work to prosper.

5. MISSION ANALYSIS
Components P&G
Customers Yes
Products or services Yes
Market Yes
Technology No
Concern for survival growth and profitability. Yes
Philosophy No
Self concept Yes
Concern for public image. Yes
Concern for employees Yes

6. PROPOSED MISSION
 We 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.
 As a result, consumers will reward us with leadership sales, profit
and value creation, allowing our people, our stakeholders and the
communities in which we live and work to prosper.
 We will continue to ensure product safety for the environment by
staying on top of the leading new technologies in diverse area
such as analytical chemistry, bio statistics, computer science and
modeling, environmental science. Diversity and Inclusion will also
be sustained for the continued growth of P&G.

7. EXTERNAL ANALYSIS
EXTERNAL
FACTORS
EVALUATION

8. OPPORTUNITIES: Weight Rating Rated
Score
1 Increasing the demand of higher priced products, such as
cosmetics and fragrances.
0.09 3 0.27
2 customers are attracted by social media advertising. 0.07 2 0.14
3 People are more health conscious. 0.07 2 0.14
4 The beauty and cosmetics industry is expected to increase globally
especially in the emerging market.
0.08 3 0.24
5 There is an endless possibility to `celebrities’ endorsing fragrances,
these products are successful because many are persuaded by
fame of the celebrity.
0.06 2 0.12
6 Men are more concerned about their appearance, health and
beauty products.
0.08 3 0.24
7 Increasing the demand of online purchasing. 0.08 3 0.24
8 Being a leader in some of the most demanding product in the
market.
0.09 3 0.27

9. THREATS: Weight Rating Rated
Score
1 Increasing the cost of raw material. 0.04 4 0.16
2 High competition in fast moving consumer good market today. 0.04 3 0.12
3 Increasing competitors’ expansion in global market such as; Colgate-
Palmolive, Unilever, and Clorox.
0.09 4 0.36
4 Regulations are increasing due to the voicing of different groups
about harmful chemical ingredients in cosmetic products.
0.07 3 0.21
5 The Unilever companies ranks number two in personal care and
household companies.
0.09 3 0.27
6 Many substitute products are available in market at cheaper price. 0.05 4 0.20
TOTAL 1.00 2.98

10. INTERNAL ANALYSIS
INTERNAL
FACTORS
EVALUATION

11. STRENGTHS: Weight Rating Rated
Score
1 Sold Pringles line of snacks for $1.5 billion in 2011. 0.12 4 0.48
2 P&G focus on beauty and personal-care products. 0.08 4 0.32
3 In 2011, Fortune ranked P&G the number one soap and cosmetic in the
world.
0.06 4 0.24
4 New CEO, Mr. McDonald focuses on lower-end products aimed at price
sensitive customers.
0.07 4 0.28
5 P&G operates under a strategic business units (SBU) structure. 0.05 4 0.20
6 Twenty-three P&G brands annually earn over $1 billion in revenue. 0.10 4 0.40
7 P&G owned all top brands such as Braun, bounty, Charmin, Crest,
Downy/lenor, Gillette, Iams, Olay, Pampers, Pantene.
0.10 4 0.40
8 P&G invested nearly $2 billion in R&D in 2010. 0.05 4 0.20
9 Market share grew in 14 of top 17 countries in 2010 0.07 4 0.28

12. WEAKNESSES: Weight Rating Rated
Score
1 No published vision statement. 0.02 1 0.02
2 $57 billion in goodwill on balance sheet. 0.04 1 0.04
3 Profits declined 5.2% in 2011 yet revenues increased 2.9%. 0.04 2 0.08
4 Weak profitability ratios. 0.04 2 0.08
5 P&G is not operating as efficiently as Johnson & Johnson. 0.05 1 0.05
6 Spent $772.6 million in advertising to Johnson & Johnson’s $366.8
million.
0.07 1 0.07
7 Consumers may not associate all of our brands with P&G rather view
them as their own distinct companies.
0.04 1 0.04
TOTAL 1.00 3.18

14. STRENGHTS
 Diverse range of business segments.
 Large amount of customer based.
 Most products are not highly seasonal.
 All top brands are owned by P&G.
 P&G invested $2 billion in Research and Development.

15. WEAKNESSES
 Decreasing in profits up to 5.2% yet revenues increased 2.9%.
 P&G is not operating as efficiently as Johnson & Johnson.
 P&G spent over $772.6 million in advertising as compared to their
competitors.
 Previous CEO has focused the strategy on innovation without
concern the customer demands.

16. OPPORTUNITIES
 Increasing the demand of higher priced products, such as
cosmetics and fragrances.
 Capturing market share from competitors through advertising.
 Youngsters are highly attracted by social media advertising.
 Accelerate its growth in developing markets, such as Brazil and
India.

17. THREATS
 A material change in consumer demand or products could have a
significant impact on business.
 The Unilever companies ranks number two in personal care and
household companies.
 Regulations are increasing due to the voicing of different groups
about harmful chemical ingredients in cosmetic products.

18. SWOT STRATEGY MATRIX

19. Strengths
1. Large amount of customer
based.
2. Most products are not highly
seasonal.
Weaknesses
1. Decreasing in profits up to
5.2% yet revenues
increased 2.9%.
2. Previous CEO has focused
the strategy on innovation
without concern the
customer demands.
Opportunities
1. Accelerate its growth in
developing markets such
as Brazil and India.
 In developing market,
customers have chance to
use the products of P&G.
(S2, O3)
 P&G products can get into
Brazil and India markets as
there are customer demand
(W2,O3)
Threats
1. A material change in
consumer demand or
products could have a
significant impact on
business.
2. Business is subject to
legislation, regulation as
well as enforcement in the
US and abroad.
 P&G can increase their
number of products to meet
the demands of consumer.
(S3, T1)
 To reduce the number of
products that cannot give
profit in order to cut the cost
(W1,T2)

20. PORTER’S FIVE FORCE MODEL

21. INTENSITY OF COMPETITOR: HIGH
P&G’s market environment is highly competitive, with global,
regional, and local competitors. P&G sells its product in
many markets and industry segments, P&G competes
against other branded products as well as retailers’ private-
label brands.

22. THREAT OF NEW ENTRANTS: LOW-
MODERATE
The threat of new entrants to be very low because of the
high range of Procter and Gamble Products, it is hard
for another organization easily to come in this line. It is
very low probability for new entrant to become a big
and holds impressive shares as well as huge capital as
P&G.

23. THREAT OF SUBSTITUTES: LOW-MODERATE
The threat of substitutes is moderate and low because
most of the products that P&G sells are use in daily life.
The company's strength in offering market all over the
world in all of P & G products. The company has
adopted a variety of strategies with their clients to
develop a better understanding of consumer demands
and respond to them.

24. BARGAINING POWER OF SUPPLIERS: LOW
The bargaining power of suppliers is low because P&G have not
reliance on specific suppliers. The bargaining power of supplier is
coped with mutually dependent relationship of company with its
suppliers. Suppliers in market are always in search of reputed
clients that can help them to generate good amount of revenue.
The standard reputation maintained by Procter and Gamble offers
advantage to the company in this regard. Therefore, the prevailing
crisis of credit and fluctuation in interest rates do not affect the
terms of company with suppliers.

25. BARGAINING POWER OF BUYERS:
MODERATE
The power of buyers is moderate because as mentioned,
20% of P&G’s sales are to Wal-Mart who is a very
demanding buyer. The economic downturn will not
have a significant impact on P&G because of the
diversity and recession proof status of its product. The
product that P&G offers can sustain in a slowdown
economy.

26. SPACE MATRIX

27. INTERNAL ANALYSIS:
Financial Position (FP)
RATING
The company’s revenue increased 2.9 percent. 4
Profit declined 5.2 percent with high amount intangibles and
goodwill.
2
The P&G operating income start to increase. 3
The liabilities use had been reduced 7 percent. 3
All the product net sales and earnings going up. 4

28. INTERNAL ANALYSIS:
Competitive Position (CP)
RATING
P&G can increase market share through advertising. -1
Product Quality -3
Customer Loyalty -2
Unilever and Johnson & Johnson are creating tough
competition.
-2
Control over Suppliers and Distributors -2

29. EXTERNAL ANALYSIS:
Stability Position (SP)
RATING
Rate of Inflation -2
Technological Changes -2
Competitive Pressure -4
Barriers to Entry into Market -3

30. EXTERNAL ANALYSIS:
INDUSTRY POSITION (IP)
RATING
Growth Potential 7
Financial Stability 7
Resource Utilization 5
Profit Potential 6

32. STAR
•Gillette
•Pantene
•Bounty
•Whisper
•Head and shoulders
•Pampers
QUESTION MARK
•Olay
CASH COW
•Ariel
•Tide
•Oral- B
•Crest
•Vicks
DOGS
•Ambi pur
•Wella

33. CPM MATRIX

34. CRITICAL
SUCCESS
FACTORS
P&G UNILEVE
R
JOHNSON
&
JOHNSON
WEIGHT Rating Score Rating Score Rating Score
Advertising 0.1 3 0.3 4 0.4 2 0.2
Product quality 0.13 3 0.39 3 0.39 3 0.39
Price
competitiveness
0.12 3 0.36 2 0.24 2 0.24
Market share 0.14 3 0.42 4 0.56 2 0.28
Global
expansion
0.15 2 0.3 4 0.6 3 0.45
Consumer
loyalty
0.12 3 0.36 3 0.36 3 0.36
Cost 0.13 3 0.39 3 0.39 4 0.52
Financial
Position
0.11 3 0.33 4 0.44 3 0.33
Total 1.00 2.85 3.38 2.77

35. RECOMMENDATION
 To maintain the reputation in the market as many substitute goods
are available.
 For P&G, it is important to deliver the quality products along with
the innovation alteration.
 To retain its position among the consumers, P&G should introduce
new and feasible products in the market.
 P&G should target teenagers through social media advertising.
 Procter & Gamble should allocate over $100 million for the
advertisement and also promote male skin care products by using
of celebrities as a spokesmen.

36. BIBLIOGRAPHY
 Procter and Gamble’s website : www.pg.com
 https://www.allfreepapers.com/Business/Porters-5-Forces-Pg/14956.html

37. THANK
YOU! 