Procter and Gamble
Team 2 Markus Bernhuber, Daniel Dong, Tatyana Glushchenko, Francesco Pasquetti, Raffi Semerciyan |August 21th, 2010 | |
P&G Case Report
Introduction:
The case takes us back in June 2000, facing two main issues slumping in stock price and leadership crisis when Jager the CEO at that time steps down and is replaced by Lafley. Jager initiated one year ago a reorganization of P&G called ‘Organization 2005’ in order to regain growth of sales.Mainly the new organization consist of a shift from geographical structure to a global product business divisions structure.
But Wall Street seemed to punish this move in spring 2000 when the stock price felt by 50% from its peak. P&G internal low confidence was also punishing this move and was the expression of the internal resistance to these changes.
Lafley, the new CEO who takeover Jager has now a dilemma. He must make a choice on whether or not to continue ‘Organization 2005’. He was facing several problems, first of all the lack of coordination across countries and region combined with a willing of majority of senior manager to reverse back to a regional business organization.
Our job here as EMBA students is to help Lafley in this difficult choice eliminare
To do that, we will first understand the features of the ‘Organization 2005’ and their rationales. Then we will also analyse what are the factors that we should consider before concluding with our advices.
1. What are the main features of the Organization 2005 initiative? What are their rationale?
The goal of a greater innovation and faster responsiveness was a new culture revolution. Pushing in innovation moving out the organization from the inertia with a strong emphasis of performance target and payment related.
The new organization was a new orientation from geographical to global business unit in order to reduce the burocracy internal to the old organization, thanks to a more efficient integration
P&G Case Report
Introduction:
The case takes us back in June 2000, facing two main issues slumping in stock price and leadership crisis when Jager the CEO at that time steps down and is replaced by Lafley. Jager initiated one year ago a reorganization of P&G called ‘Organization 2005’ in order to regain growth of sales.Mainly the new organization consist of a shift from geographical structure to a global product business divisions structure.
But Wall Street seemed to punish this move in spring 2000 when the stock price felt by 50% from its peak. P&G internal low confidence was also punishing this move and was the expression of the internal resistance to these changes.
Lafley, the new CEO who takeover Jager has now a dilemma. He must make a choice on whether or not to continue ‘Organization 2005’. He was facing several problems, first of all the lack of coordination across countries and region combined with a willing of majority of senior manager to reverse back to a regional business organization.
Our job here as EMBA students is to help Lafley in this difficult choice eliminare
To do that, we will first understand the features of the ‘Organization 2005’ and their rationales. Then we will also analyse what are the factors that we should consider before concluding with our advices.
1. What are the main features of the Organization 2005 initiative? What are their rationale?
The goal of a greater innovation and faster responsiveness was a new culture revolution. Pushing in innovation moving out the organization from the inertia with a strong emphasis of performance target and payment related.
The new organization was a new orientation from geographical to global business unit in order to reduce the burocracy internal to the old organization, thanks to a more efficient integration