Management & Financial Strategy and Practice

Posted: August 25th, 2021

Student’s Name

Instructor’s Name

Course

Date

Management & Financial Strategy and Practice

Management Strategy and Practice

Key Executives

CEO, Chairman, and President: David Scott Taylor

 Vice-Chairman and CFO: Jon R. Moeller

Treasurer and Comptroller: Valarie L. Sheppard

Chief Legal Officer and Secretary: Deborah P. Majoras

Chief Brand Officer for Procter and Gamble: Marc S. Pritchard

President of Global Business Services: Laura Becker

Chief Diversity Officer: William P Gipson

President of Greater China Selling and Market Ops: Matthew S. Price

Vice President Sales:  Amy Eskoff Garrett

Global eCommerce Manager at Procter and Gamble: Leslie Bauers

Organizational Structure

Procter and Gamble is an international company that deals with a large range of products. Its organizational structure is grounded by the company’s grouping of the products. These are the product-type divisions, the Geographical-type divisions, and the Functional –type divisions. The product-type divisions entail assembling of products through the product mix in Procter and Gamble marketing mix. The product-type divisions are include of Beauty, Grooming, and Healthcare products. Procter and Gamble Company depend on geographical divisions to manage its regional operations. Being a consumer good corporation, it has several international operations. North America, Europe, Asia Pacific, and Greater China are some geographical divisions for Procter and Gamble Corporation internationally. Functional grouping in Procter and Gamble Company is essential as it aids in brainstorming on ways to reach global markets. Functional groups appear in a hierarchical manner for proper management and decision making. The functional groups are headed by executive staffs who aid in enhancing their operations. Some of the Procter and Gamble functional groups are.

• CEO
• CFO/Finance
• Global Health Care
• Global Fabric and Home Care and Global Baby and Feminine Care
• Global Family Care and Global Brand Creation and Innovation, P&G Ventures
• Global Beauty
• Global Grooming
• North America Selling and Market Operations

The Functional groups in Procter and Gamble Corporation are accountable for the ultimate functions of the entire enterprise.

Tall Vs. Flat Organization

Tall and Flat organization depend on the structural levels of a company’s management. A tall structural organization is headed by a CEO or a leader who makes decisions for the firm and communicates to his/her juniors. In a flat structural organization, there are few managers and employees at lower levels are involved in decision-making processes for the firm. The organizational chart for Procter and Gamble shows that it falls into the upper right-hand quadrant. The Company is headed by a CEO /chairman and other executive staffs follow. Procter and Gamble is an international corporation that has many employees. Its structural management is tall. This is evident as it deals with different brands and their marketing in the world, therefore, executives are chosen to oversee the fundamental operations of the firm. The Corporation is recognized as a tall organization since it has a hierarchy under management from the top-executives down to the employees.

SWOT Analysis

Strengths.

• Market Flexibility: Most of the companies that have remained competitive for many years understand well the technique of market flexibility. Procter and Gamble is a good example. Most of the brands associated with P&G are legendary. To ensure that there are zero chances of the brands losing tough in the market, the firm trimmed its 300 brands in 2014 to 65 solid brands. This move multiplied its market competitiveness, and it shows the unmatched prowess of the company with regard to market flexibility. 
• Economies of Scale: As a top player in the consumables industry, P&G is an organization with huge market capitalization. In every product portfolio, it leads in the market. Its large size is what makes it dominant. It is able to engage in mass production even without fear of overstocking given consumers across the world value its brands.
• Monopoly Power: P&G does not operate in a monopoly market. Nonetheless, factors such as huge market capitalization, unparalleled brand popularity, and market penetration make the company have monopoly power which has prevented competitions. For example, new entrants of unpopular brands have found it difficult to win consumer appeal.
• Excellence and Innovativeness: It is not by coincidence that P&G’s product portfolio has taken the global market by storm. Most of the brands from this organization are a true reflection of excellence and innovativeness and hence, the unmatched consumer appeal (Bhasin).
• Exceptional Marketing Strategies: Tide is an example of brands that P&G has managed to market successfully across international markets. Not that people are unaware of other detergents in the market, but the way Tides is marketed to them makes it the only detergent they can trust. This is just one example of how P&G has managed to ouster other major brands in the global market following its tactful marketing strategies. 

Weaknesses.

• Bureaucracy: This relates to having many centers of powers. At P&G, the organizational structure is complex. The official procedure for implementing even simple ideas is complex (Bhasin). This kind of bureaucracy at P&G hinders timely decision making.
• Rigidity. With regard to responding to changes in consumers’ needs, P&G scores zero. Though its products are popular in the market, they are rarely updated or revised to meet the current consumers’ needs.

Opportunities.  

• Increase in Purchasing Power: People continue to access good education that guarantees them a brighter future as far as financial stability is concerned. This means that in the coming days, consumers’ purchasing power will increase, and this will be to the benefit of P&G.
• Mergers and Acquisitions:In the developing countries where P&G is yet to penetrate completely, there are many companies that deal with consumer goods and which are struggling to survive. Their predicament presents an opportunity that P&G could exploit in penetrating the markets through acquisitions and mergers.

Opportunities.

• Intense Competition: Although P&G is an established company with dominant brands, countless competitors are on the rise, and this is a threat that could ouster P&G as a dominant market player.

Financial Strategy and Practice

• Most Recent Quarterly Income Statement

• Most recent quarter’s Revenue and Net Income figures.

From the attached Income Statement, the most recent quarter for which the financial information is available is the first quarter of the year 2019. From the financial report, the total revenues stand at 16,462,000,000. The net income, on the other hand, is 2,745,000,000.

• The firm’s Return on Sales (ROS)

Net Income/Revenue

2,745,000,000/16,462,000,000

= 0.1668

• Stock Price

At the end of the day, July 19, the closing stock price of P&G shares was recoded as 103.02+0.62 (+0.61%). This, apparently, is the current stock price. In the next quarter, there are higher chances that the price will increase. P&G is engaged in competitive marketing, and hence, its value to the investors given its potential in making profits is likely to improve. This means its stock will be valued higher, and thus, the increase in price.

Works Cited

Bhasin, Hitesh. “SWOT Analysis of P&G – Procter & Gamble SWOT Analysis.” Marketing91, 19 Feb. 2019, www.marketing91.com/swot-analysis-procter-gamble/. Accessed 21 July 2019.