This feature explores the evolution of Procter & Gamble’s global strategy. In 1915, Procter & Gamble opened its first foreign operation in Canada. In the 1950s and 1960s, P&G expanded into Western Europe, and then, in the 1970s, into Japan and other parts of Asia. Throughout this expansion, the company maintained all product development at its Cincinnati, Ohio headquarters, while each subsidiary took on the responsibility for manufacturing, marketing, and distributing the products. P&G shifted its strategy in the 1990s, closing several foreign locations and moving to a more regional approach to global markets. In 1999, the company implemented “Organization 2005,” a business unit approach whereby different units are entirely responsible for generating profits for a product group.
Discussion Questions
1. Discuss the evolution of Procter & Gamble’s strategy. Do you think P&G was reactive or proactive in its approach to strategy in the late 1990s and early 2000s?
2. What factors have forced Procter & Gamble to change its strategy? As a competitor to P&G, what can you learn from the company’s experiences?
3. How would you characterize Procter & Gamble’s current strategy? What are the benefits of this strategy? What challenges do you foresee with the new strategy?