Demonstrates Superiority, Productivity and Organization Strategies Driving Improved Results
Highlights Efforts to Lead “Constructive Disruption” for Future Success
Simplifies Organization Structure to Increase Focus, Agility and Accountability
CINCINNATI--(BUSINESS WIRE)--The Procter & Gamble Company (NYSE: PG) today updated shareowners and
analysts on significant progress toward its goals of delivering
stronger, balanced growth and value creation. The Company affirmed its
focus on its core growth strategy of delivering noticeable brand
superiority; driving productivity improvement and cost savings to fuel
investments and margin; and transforming P&G’s organization and culture.
This growth strategy is driving improved results, including faster
top-line growth, increased consumption, and market share growth.
Under the theme of “leading constructive disruption,” P&G highlighted a
broad range of initiatives across innovation, brand building, supply
chain, information technology and citizenship that are creating new
levels of competitive advantage for the Company and its brands. The
Company also announced several organization changes, effective July 1,
2019, that will simplify the management structure and further increase
focus, agility and accountability. A replay of today’s presentation is
available at www.pginvestor.com.
“To deliver growth for P&G shareowners, we are accelerating the pace of
change and stepping up execution to meet the challenges of today’s
dynamic world. We are leading constructive disruption across the entire
value chain, creating a more focused, more agile and more productive
company designed to win with consumers at the speed of the market,” said
David Taylor, Chairman, President and Chief Executive Officer. “We
remain focused on creating and extending noticeable superiority of our
brands, driving productivity improvement and cost savings to fuel
investments and margin, and transforming P&G’s organization and culture.
“We’ve made good progress in each of these areas, which is showing up in
our results. Consumption of P&G products is increasing. Market share is
up globally, and it’s translating into faster top-line growth,”
continued Taylor.
During today’s presentation, multiple P&G business leaders discussed how
improvements in five areas of competitive superiority (product
performance, packaging, consumer communication, retail execution
in-store and online, and consumer and customer value) are driving
stronger business results. These leaders also highlighted new
initiatives from Tide, Downy/Lenor, Always, Olay, SK-II and Gillette
that will continue this momentum.
P&G executives leading Research & Development, Brand Building, Supply
Chain, and Information Technology highlighted multiple efforts already
underway to step-change effectiveness and efficiency in each of these
areas. Taylor discussed P&G’s achievements and objectives in corporate
citizenship.
Increasing Organization Focus, Agility and
Accountability
Building on a series of improvements already in place, the Company
announced a new, simpler management structure to provide greater clarity
on responsibilities. New reporting lines will strengthen leadership
accountability and enable P&G people to accelerate growth and value
creation.
Beginning July 1, 2019, the Company will operate though six
industry-based Sector Business Units (SBUs) for the largest geographic
markets, led by Sector Business Unit CEOs who will report to Taylor.
These SBUs will have direct sales, profit, cash and value creation
responsibility for its largest markets – U.S., Canada, China, Japan,
U.K., Germany, France, Spain, Italy, Russia and smaller adjacent
countries – accounting for about 80% of Company sales and 90% of
after-tax profit. The SBUs will have responsibility for all facets of
the business in these markets: consumer understanding, product and
package innovation, brand communications, selling and retail execution,
and supply chain. In these markets, the Company will continue to provide
scaled market services to help the SBUs operate efficiently and with
high quality.
Responsibility for the remaining markets will be organized into a
separate unit with sales, profit, and value creation responsibility. The
SBUs will provide innovation plans and operating frameworks to drive
growth and value creation in these markets. The intent is to give these
markets executional freedom, with just enough framework, to ensure their
success.
The Company will continue to reduce the level of corporate resources,
with about 60% of corporate work shifting to the business units and
markets and will retain a core set of corporate resources needed to
sustain the ongoing health, viability and sustainability of the
Corporation. This includes back-office operations, governance and
stewardship, and some areas requiring deep mastery. In particular, P&G
will retain its Corporate Research & Development group that invents
upstream platform technologies to benefit multiple businesses and opens
opportunities for P&G to get into entirely new businesses.
Chief Financial Officer Jon Moeller will expand his responsibilities to
include the operations side of the Company and will be appointed Vice
Chairman, Chief Operating Officer and Chief Financial Officer,
continuing to report to Taylor. In this capacity, Moeller will assume
responsibility for markets beyond those managed directly by the SBUs,
Market Operations providing scaled market services, and functions that
support operations.
The Company reiterated this structure supports continued focus on the
streamlined portfolio of 10 product categories; ongoing efforts to move
resources closer to the consumers and customers it serves; supplementing
internal talent with skilled, experienced external hiring; improving
category dedication and mastery; strengthening of compensation and
incentive programs; and ongoing improvements in productivity.
“This is the most significant organization change we’ve made in the last
20 years,” Taylor concluded. “We will have a more engaged, agile and
accountable organization focused on winning with consumers through
superiority, fueled by productivity, and operating at the speed of the
market.”
Forward-Looking Statements
Certain statements in this release or presentation, other than purely
historical information, including estimates, projections, statements
relating to our business plans, objectives, and expected operating
results, and the assumptions upon which those statements are based, are
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995, Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
These forward-looking statements generally are identified by the words
“believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,”
“strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,”
“would,” “will be,” “will continue,” “will likely result,” and similar
expressions. Forward-looking statements are based on current
expectations and assumptions, which are subject to risks and
uncertainties that may cause results to differ materially from those
expressed or implied in the forward-looking statements. We undertake no
obligation to update or revise publicly any forward-looking statements,
whether because of new information, future events or otherwise.
Risks and uncertainties to which our forward-looking statements are
subject include, without limitation: (1) the ability to successfully
manage global financial risks, including foreign currency fluctuations,
currency exchange or pricing controls and localized volatility; (2) the
ability to successfully manage local, regional or global economic
volatility, including reduced market growth rates, and to generate
sufficient income and cash flow to allow the Company to affect the
expected share repurchases and dividend payments; (3) the ability to
manage disruptions in credit markets or changes to our credit rating;
(4) the ability to maintain key manufacturing and supply arrangements
(including execution of supply chain optimizations and sole supplier and
sole manufacturing plant arrangements) and to manage disruption of
business due to factors outside of our control, such as natural
disasters and acts of war or terrorism; (5) the ability to successfully
manage cost fluctuations and pressures, including prices of commodities
and raw materials, and costs of labor, transportation, energy, pension
and healthcare; (6) the ability to stay on the leading edge of
innovation, obtain necessary intellectual property protections and
successfully respond to changing consumer habits and technological
advances attained by, and patents granted to, competitors; (7) the
ability to compete with our local and global competitors in new and
existing sales channels, including by successfully responding to
competitive factors such as prices, promotional incentives and trade
terms for products; (8) the ability to manage and maintain key customer
relationships; (9) the ability to protect our reputation and brand
equity by successfully managing real or perceived issues, including
concerns about safety, quality, ingredients, efficacy or similar matters
that may arise; (10) the ability to successfully manage the financial,
legal, reputational and operational risk associated with third-party
relationships, such as our suppliers, distributors, contractors and
external business partners; (11) the ability to rely on and maintain key
company and third party information technology systems, networks and
services, and maintain the security and functionality of such systems,
networks and services and the data contained therein; (12) the ability
to successfully manage uncertainties related to changing political
conditions (including the United Kingdom’s decision to leave the
European Union) and potential implications such as exchange rate
fluctuations and market contraction; (13) the ability to successfully
manage regulatory and legal requirements and matters (including, without
limitation, those laws and regulations involving product liability,
intellectual property, antitrust, data protection, tax, environmental,
and accounting and financial reporting) and to resolve pending matters
within current estimates; (14) the ability to manage changes in
applicable tax laws and regulations including maintaining our intended
tax treatment of divestiture transactions; (15) the ability to
successfully manage our ongoing acquisition, divestiture and joint
venture activities, in each case to achieve the Company’s overall
business strategy and financial objectives, without impacting the
delivery of base business objectives; and (16) the ability to
successfully achieve productivity improvements and cost savings and
manage ongoing organizational changes, while successfully identifying,
developing and retaining key employees, including in key growth markets
where the availability of skilled or experienced employees may be
limited. For additional information concerning factors that could cause
actual results and events to differ materially from those projected
herein, please refer to our most recent 10-K, 10-Q and 8-K reports.
About Procter & Gamble
P&G serves consumers around the world with one of the strongest
portfolios of trusted, quality, leadership brands, including Always®,
Ambi Pur®, Ariel®, Bounty®, Charmin®, Crest®, Dawn®, Downy®, Fairy®,
Febreze®, Gain®, Gillette®, Head & Shoulders®, Lenor®, Olay®, Oral-B®,
Pampers®, Pantene®, SK-II®, Tide®, Vicks®, and Whisper®. The P&G
community includes operations in approximately 70 countries worldwide.
Please visit https://www.pg.com/
for the latest news and information about P&G and its brands.