8/14/2019 P&G. Transforming a Market Leader. From Business Genius by Peter Fisk

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www.thegeniusworks.com Peter Fisk 2008

Proctor & GambleTransforming a global market leader

Peter Fisk

AJ Lafley is in the midst of engineering a remarkable turnaround. The first thing Lafley (Alan is his firstname) told his managers when he unexpectedly stepped up to the CEO job in 2000 was just whatthey wanted to hear: Focus on what you do well -- selling the company's major brands such as Crest,Tide and Pampers -- instead of trying to develop the next big innovation.

Now, old staples of the P&G stable have done so well that they are again the envy of the industry. Sois the company's share price, which climbed 58%, to $92 a share in the six years since Lafley started,while the overall stock market has declined 32%. Profits are almost $6 billion on sales of $44 billion,having outgrown most rivals for the past five years.

Maybe softly-spoken Lafley was the antidote P&G needed after 18 months of Dirk Jager, theprevious CEO who had flown into Cincinatti from the Netherlands on a mission to shake up thecompany. He stuck up Old World, New World posters, asking people which world they were in. Theshare price plummeted. He rammed through an agenda of change, and whilst he was absolutely rightthat the business need a new, and much more external culture, he ripped apart everything that P&Gsinsular culture was built on, and alienated almost everyone. Instead of pushing P&G to excel, historrent of slogans and initiatives almost brought the company to its knees.

Lafley, in his 23rd year at P&G wasn't supposed to be a radical change agent, he was supposed tobring some stability back to the business. Having spent his early years managing Tide, a decaderunning the Japanese business, he had recently returned to head up North American operations. Herecognized the need for change, the need for more speed and agility, a deeper understanding ofconsumers, and a more radical approach to innovation. But he also understood that P&Gers someof the best trained, brightest managers in the world would only embrace such change in a P&G way.

8/14/2019 P&G. Transforming a Market Leader. From Business Genius by Peter Fisk

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8/14/2019 P&G. Transforming a Market Leader. From Business Genius by Peter Fisk

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www.thegeniusworks.com Peter Fisk 2008

Lafley regularly reminds people of the their enduring purpose: to improve the everyday lives ofpeople around the world with P&G brands and products that deliver better performance, quality and

value. He points out that this has not changed, nor has the values and principles of the business.

One thing he has carefully avoided is setting out a vision statement. He doesnt believe it isnecessary, that the purpose of the business is clear and that is sufficient, and otherwise it is about theconsumer not the business. He calls it managing from the future back his eyes and ears ontodays world, and his back to the future, believing that the consumer is his best navigator.

Peter Fisk 2008. This article is extracted from Peter Fisks new book Business Genius: a moreinspired approach to business growthpublished by Wiley Capstone in May 2008.

Peter Fisk is an inspirational author and speaker, consultant and entrepreneur. His best-selling book

Marketing Geniushas been translated into 28 languages, and he was recently described by BusinessStrategy Reviewas one of the best new business thinkers. His new book Business Geniusdescribes the challenge of sustaining business growth through turbulent times.

He has worked internationally with market leaders including British Airways and Coca Cola, Marks &Spencer and Microsoft, Virgin and Vodafone. He was the transforming CEO of the Chartered Instituteof Marketing, led the global strategic marketing consulting team of PA Consulting Group, managingdirector of Brand Finance, and partner of strategic innovators The Foundation.

He now leads The Genius Works, helping business leaders to see things differently to develop andimplement more inspired strategies, innovation and marketing. The Genius Labis an acceleratedinnovation process. Zoom Venturesbrings together business investors and social entrepreneurs. TheFast Trackis a practical development programme with workshops and retreats worldwide.

For more information visit www.thegeniusworks.com or email peterfisk@peterfisk.com