Proctor and Gamble (DRAFT) Case Discussion Questions What strategy was Proctor and Gamble pursuing when it first entered foreign markets in the period up until the 1980’s? •In 1915 opened a plant in Canada to produce Ivory Soap and Crisco •In the 1970’s P&G entered Japan and other Asian Nations. •Strategy- P&G entered a nation by acquiring an established competitor and its brands. i. e. case of Great Britain and Japan. •Strategy- the Company developed new products in Cincinnati and then relied on semiautonomous foreign subsidiaries to manufacture market and distribute those products in different nations.
In many cases. Foreign subsidiaries had their own production facilities and tailored the packaging, brand name, and marketing message to suit local taste and preferences. (NB. This took away the stress of research and development in foreign countries, thus took away unnecessary costs). •In the early twentieth century, Procter & Gamble continued to grow. The company began to build factories in other locations in the United States, because the demand for products had outgrown the capacity of the Cincinnati facilities.
The company’s leaders began to diversify its products as well and, in 1911, began producing Crisco, a shortening made of vegetable oils rather than animal fats. •Throughout the twentieth century, Procter & Gamble continued to prosper. The company moved into other countries, both in terms of manufacturing and product sales, becoming an international corporation with its 1930 acquisition of the Newcastle upon Tyne-based Thomas Hedley Co. Procter & Gamble maintained a strong link to the North East of England after this acquisition.
In addition, numerous new products and brand names were introduced over time, and Procter & Gamble began branching out into new areas. Why do you think this strategy became less viable in the 1990’s? •P costs were too high because of extensive duplication of manufacturing, marketing, and administrative facilities in different national subisidiaries. The duplication of assets made sense when national markets were segmented from each other by barriers to cross-border trade. (Products produced in one country could not be economically sold in another due to igh tariff duties levied on imports to Germany for example). (Need more points on this question) What Strategy does P appear to be moving toward? What are the benefits of this strategy? What are the potential risks associated with it? •(From the textbook pg 434) The company shut down 30 manufacturing plants (deemed unnecessary? ) to concentrate on those remaining so that they are able to achieve economies of scale in their respected region. •1998- strategy of changing image to a global company.
Tore up old organisation which was based on countries and regions to one based on 7 self contained global units. Each unit was instructed to rationalise production concentrating it in fewer larger facilities ; to try build global brands (this then eliminates marketing difference between countries making it easier to launch new products). Profits showcase success. •From Harvard Business- P are investing more in Innovation Processes!. Development of technology etc. to improve brand, product, design and function (final consumer in mind during process). Also from Harvard Business – P uses the posters strategy, which simplify their plans for public to see, get people involved with the process, value their input as focus is on buyers + users. General slogan ‘The customer is the boss’. •Risky in the fact that involving ‘consumers’ takes time, which slows down process. By eliminating manufacturing plants…loss of assets which may be of value in future? Building global brands in different countries means compliance with their rules and regulations. Costs more $$$. Technology is always changing. Is one change enough? Will there be the need to change in the future? Technology is unpredictable thus the ‘predicted’ result cannot be entirely relied upon. Slide 1: Intro (maybe a youtube link? ), with logos of the company’s products (need to familiarise audience with how P is associated with them in everyday life). We can interact with audiences and ask if they have used or own any of the products listed. =) Slide 2: Intro and History of P. How did the company come about…Maybe a timeline?
And a little summary on why it’s so unique. Slide 3: Discussion question 1. Slide 4: Slide 5: Slide 6: Discussion question 2 Slide 7: Slide 8: Discussion question 3 Slide 9: List all strategies on one slide followed by limitation on the next! =D Slide 10: Slide 11: Slide 12 etc: Discussion with class (interaction): Maybe a little handout? With info. Give them a scenario with alternatives. Asking them which STRATEGY is most suitable. Question and answer time at the end and finish with a final point. That should be enough =)