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PREPA
RED BY
:
MOHAMAD KAMAL B
IN YA
HAYA
2010117355
NOORHIDAY
AH BIN
TI A
BDUL RAHIM
2010908913
NUR HAMIZ
AH BIN
TI Z
AKARIA
2010513041
SITI M
AZIRA B
INTI
AHMAD
2010350649
PREPA
RED FOR :
MISS N
URUL SYA
ZWANI B
INTI
MOHAMAD S
AID
P&G focus on providing consumer packaged goods
Founded in 1837 by William Procter and James Gamble.
Operates in over 180 countries today primarily through mass merchandisers, grocery stores, membership club stores, drug stores and high-frequency stores.
P&G is organized 3 Global Business Units:
1) Beauty and Grooming,
2) Health and Well-Being and
3) Household Care
““We will provide branded products and We will provide branded products and services of superior quality and value services of superior quality and value that improve the lives of the world’s that improve the lives of the world’s consumers, now and for generations to consumers, now and for generations to come. As a result, consumers will reward come. As a result, consumers will reward us with leadership sales, profit and value us with leadership sales, profit and value creation, allowing our people, our people, creation, allowing our people, our people, our shareholders, and the communities our shareholders, and the communities in which we live and work to prosper.”in which we live and work to prosper.”
STRATEGY ANALYSIS
STRENGHTS
1.Diverse range of business segments
2.Large amount of customer based.
3.Most products are not highly seasonal
WEAKNESSES
1.Price paid for commodities for the products subject to fluctuation
2.Previous CEO has focused the strategy on innovation without concern the customer demands
OPPORTUNITIES
1.Research and development efforts to develop technology
2.Capturing market share from competitors through advertising
3.Accelerate its growth in developing markets such as Brazil and India
THREATS
1.A material change in consumer demand or products could have a significant impact on business
2.Business is subject to legislation, regulation as well as enforcement in the U.S and abroad
BACKGROUND OF COMPANY
• SO Customer in developing market Brazil and India have the chance to use P&G
products (S2, O3)
• WO• P&G products can get into Brazil and India markets as there are customer
demand.(W2, O3)
• ST• Increase the number of products that can meet the consumer demands (S3,
T1)
• WT• Reduce the number of products that cannot give profit in order to cut the cost
(W1, T2)
FINANCIAL POSITION (FP)
STABILITY POSITION (SP)
COMPETITIVE POSITION
(CP)
INDUSTRY POSITION (IP)
FP
SP
CP
IP
7
6
5
4
3
2
1
-3
-2
-1
-4
-5
-6
-7
0-7
-6 -5 -4 -3 -2 -1 1 2 3 4 5 6 7
•
COMPETITIVE STRATEGIES
BACKGROUND OF COMPANY
P&G is located in competitive strategies. The strategies used by P&G:
1- Market penetration
- P&G will able to increase market share through advertising.
- P&G spend a lot on advertising compared to the others
2- Product development
- Can enhanced market share and sales of the company.
- P&G can improvised their current products or develop new
products to retain old customers and obtain new customers.
BACKGROUND OF COMPANY
DivisionSales
/Revenue ($ millions)
%Profit
($ millions)% RMSP
Net sales growth %
1Beauty
19,491 24 2,712 23 0.60 3
2Grooming
7,631 10 1,477 13 0.20 3
3Health Care
11,493 14 1,860 16 0.30 2
4Snacks and
Pet Care
3,135 4 326 3 0.10 1
5Fabric Care/ Home Care
23,805 30 3,339 28 0.80 3
6Baby Care/ Family Care
14,736 18 2,049 17 0.40 4
Total
80,291 100 11,763 100 3
23%
1.0 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0.0 0.9 0.8
+5
+10
+15
-5
-15
-10
-20
0
+200
2 3 1
5 6
28% 23% 17%
16% 13%
3%
RELATIVE MARKET SHARE POSITION (RMSP)
The division beauty and fabric care/home care is located in
Quadrant II which is “Stars”.
Quadrant II – the organization’s best long-run opportunities for
growth and profitability. Divisions with a high relative market
share and a high industry growth rate should receive substantial
investment to maintain or strengthen their dominant positions.
Other 4 divisions located in Quadrant I which is “Question Marks”.
Quadrant I represents the divisions that have low relative market
share position, yet they compete in a high-growth industry.
Internal Factor Evaluation (IFE)
Strength Weight Rate Score
Diverse range of business segments 0.3 4 0.12
Large amount of customer based 0.4 2 0.8
Most products are not highly seasonal 0.2 3 0.6
Weaknesses Weight Rate Score
Price paid for commodities for the
products subject to fluctuation
0.2 10.2
Previous CEO has focused the strategy
on innovation without concern the
customer demands
0.3 2 0.6
Total Score IFE= 2.32
External Factor Evaluation (EFE)
Opportunities Weight Rate Score
Research and development efforts to
develop technology
0.3 2 0.6
Capturing market share from
competitors through advertising
0.2 2 0.4
Accelerate its growth in developing
markets such as Brazil and India
0.5 2 1.0
Threats Weight Rate Score
A material change in consumer
demand or products could have a
significant impact on business
0.3 1 0.3
Business is subject to legislation,
regulation as well as enforcement in
the U.S and abroad
0.15 3 0.45
Total Score EFE = 2.75
Hold and maintain
RAPID MARKET GROWTH
Quadrant II 1. Market development 2. Market penetration 3. Product development 4. Horizontal integration 5. Divestiture 6. Liquidation
Quadrant I 1. Market development
2. Market penetration 3. Product development
4. Forward integration 5. Backward integration
6. Horizontal integration 7. Related diversification
Quadrant III 1. Retrenchment 2. Related diversification 3. Unrelated diversification 4. Divestiture 5. Liquidation
Quadrant IV 1. Related diversification 2. Unrelated diversification 3. Joint ventures
SLOW MARKET GROWTH
STRONG COMPETITIVE
POSITION
WEAK COMPETITIVE
POSITION
Procter & Gamble could be considered in quadrant IV, between slow
market growth but have strong competitive position.
This firm has characteristically high cash flow levels and limited
growth needs and often pursue related diversification successfully.
The reason is, in July 2010, P&G had changed their CEO from Mr.
Lafley, who focused on innovation to Mr. McDonald who focuses on
lower-end products aimed at consumers looking for discounts.
Even P&G’s revenue increased to $78.9 billion compared than
previous year, their profits declined $12.7 billion compared than
previous year.