Can having one of the world’s most innovative supply chains help Procter & Gamble defeat rivals, adapt to discount chains and react to changing consumer preferences?
Last July, Procter & Gamble announced that David Taylor would replace AG Lafley as CEO – the third change at the top in six years at a business that was once a byword for stability. Within two days the Cincinnati-based company reported a 40% fall in profits for the year ended 30 June, with sales down 5% to $76.3bn. Some observers wondered if cracks had begun to appear in one of corporate America’s most polished facades. Yet the new man in charge had joined the business as a graduate in 1980, worked across the organisation – and alongside Lafley – so his appointment could be seen as a bid to combine change with continuity.
The sheer scale of P&G’s penetration of daily life bears witness to the company’s success since it was founded in 1837. The company estimates that people interact with its products around 2bn times a day, and that its products can be found in around 5bn of the world’s 7bn households. Its portfolio contains 21 billion-dollar brands, featuring such icons as Pampers, Vicks, Gillette, Head & Shoulders, Pantene, Fairy and Hugo Boss.
And how many companies can claim to have helped invent a new form of drama? P&G put the soap into soap opera, when its detergent Oxydol started sponsoring radio dramas in 1933. The question now, however, is: are the closing credits starting to roll on P&G’s golden era?