The Transformation of Procter Gamble Into a Sustainable...

The Transformation of Procter Gamble into a Sustainable Serial Innovator A New CEO It is June 6, 2010. A few minutes before a business meeting in California A.G. Lafley, Procter Gamble ´s President – Global Beauty Care and North America receives a phone call from John Pepper, Chairman of PG. John Pepper gets right to the point: â€Å"Are you prepared to accept the CEO job at PG?† Durk Jager who has been PG ´s CEO resigned the day before after 30 years of service for PG. Without too many questions A.G. Lafley accepts John Pepper ´s offer. He becomes PG ´s new CEO. What happened under Durk Jager PG is renowned for its innovations. Products such as Tide, the first synthetic detergent, or Pampers, the first mass disposable diaper, or†¦show more content†¦Lafley underwrites the strategy that Jager pursued. He, too, feels the need for more innovation. And also in Lafley ´s mind the new global product-based organization structure is the right one in order to get more advantage out of innovations (see Att. 1 for PG ´s organization structure, and Att. 2 for PG ´s Purpose Statement). But when Lafley takes over as CEO he sees the need to improve PG ´s execution, and to take much better care and to grow the core business which has been milked before in order to invest in new brands and products. Under his leadership PG focuses on a few simple but powerful topics: †¢ PG puts the consumer at the center of everything they do. Lafley coins the phrase: â€Å"The consumer is boss†. †¢ PG makes sustainable organic growth the priority instead of acquisitions. †¢ PG ´s opens up its innovation system, it innovates innovation. This latter change towards an open innovation system is probably the most revolutionary one. It is based on the following simple logic: PG has about 9000 employees in RD working in 150 scientific fields. And the potential of this RD organization has even grown over the last few years as the sharing of ideas and expertise and the formation of networks is being fostered through intranet sites such as PG ´s InnovationNet. PG has close to 30,000 patents and each year another 5,000 are added on average. But on the other hand, counting the numberShow MoreRelatedI Love Reading Essay69689 Words   |  279 PagesCross Cultural Comparison of India and China’, Indian Institute of Management (IIM) Ahmedabad paper; Goel et al summarise some of the existing approaches as follows: ‘leader manager’ (Mill, 1848; Brockhaus and Horwitz, 1986; McClelland, 1961); ‘innovator’ (Schumpeter, 1934); ‘risk taker’ (Brockhaus and Horwitz, 1986); ‘with internal locus of control’ (Rotter, 1966; as in B H, 1986); and ‘different from managers’ (Penrose); quoting Cunnigham and Lischeron (1991), who understood the term from theRead MoreDamodaran Book on Investment Valuation, 2nd Edition398423 Words   |  1594 Pagesinstance, the rate above is an annual rate. The variance that is entered into the model also has to be an 13 annualized variance. The variance, estimated from ln(asset prices), can be annualized easily because variances are linear in time if the serial correlation is zero. 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