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Key Success Factors 5 Internal Environment 5 Internal Environment 5 Internal Environment 5 Internal Environment 5 Internal Environment 5 Internal Environment 5 Internal Environment 5 Internal Environm

   

Added on  2020-01-07

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Strategy 1

Table of ContentsINTRODUCTION ...............................................................................................................................3External environment...........................................................................................................................3PESTEL Analysis.............................................................................................................................3Market Structure..............................................................................................................................4Five Forces.......................................................................................................................................4Key Success Factors........................................................................................................................5Internal environment............................................................................................................................5Resources.........................................................................................................................................5Intangible Resources........................................................................................................................5Tangible Resources..........................................................................................................................6Human Resources............................................................................................................................6Capabilities......................................................................................................................................7Value Chain Analysis ......................................................................................................................8Functional Analysis .........................................................................................................................9Competitive Advantages.......................................................................................................................9Cost Leadership...............................................................................................................................9Differentiation Advantages............................................................................................................10Strategic Recommendations...............................................................................................................10Stakeholder Management...................................................................................................................11CONCLUSION...................................................................................................................................11References..........................................................................................................................................122

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MISSING EXECUTIVE SUMARYEXECUTIVE SUMMARYProctor & Gamble (P&G) is a Fortune 500 American multinational company which isinvolved in functional activity of manufacturing and selling personal health care products toits consumers. Open innovation strategy method has helped the company to stay ahead with its competitors by making superior quality product at relatively lower cost. Company uses product and service innovation methods to differ its product from other goods available in market. Method of strategy innovation has been recommended for company toimprove its performance by developing its operational and promotional activities in a betterway. Cost differentiation strategy has helped the firm to reach middle class and lower classconsumer segments by reducing price of its products. It has reduced its overall investmentcost by adopting innovative technology and methods to achieve objective of this strategy. The approach of P&G group to expand its market in global areas has proved beneficial forthe firm and it has increased capital structure and revenue of the firm.INTRODUCTION Nowadays, the game-changing part of an organisation is its level of innovations. It not only related to products and services but also include the ability to convert ideas into new offerings. Those elements which make an individual to develop innovative products and services include business strategy, great talent, deep customer insight, proper knowledge of roles, responsibilities, etc. Along with this, it is also important to have an active corporate culture which can support their innovation strategies (Oke, Walumbwa and Myers, 2012). For the present study, Procter & Gamble (P&G) is taken into the consideration, an American multinational consumer goods firm, which offers a range of different products for its customers. These consists of cleaning agents and personal care products like Gillette, Ariel, Oral-B, Always, Fairy, Head & Shoulders, and much more. The company has worked hard for including innovations into its daily routine and organisational culture. Company uses open strategy which allows firms to use externalideas and internal ideas to improve productivity and overall performance of the firm. Open innovation strategy is concept which provides guidelines for using external research data by sourcing it from other comapnies or by buying patents from other business house. It helps in reducing cost of conducting research and development andincreases accuracy of company for doing market research and data analysis.The file includes innovation strategy concerning the cited firm utilizing an internal/external analysis and market structure. Along with this, it also consists of stakeholder management.NEED TO EXPLAIN MORE ABOUT OPEN INNOVATION STRATEGY (C+D)EXTERNAL ENVIRONMENTPESTEL AnalysisThe PESTEL for P&G is as follows: •Political Factors: According to the Rowley, (2011), Changes in either foreign or local activities in the field of politics affects the working of organisations. It is important for firms to develop effective strategies for handling political changes. In context to this, P&G uses its goodwill and experiences for bargaining with the government of different 5

nations, so that it can modify policies and regulations. P&G operates its industrial propcess by following all the rules and regulations set by the government. A commitee has been formed by P&G known as political action committee to support its employeesat state, federal and local level on issues related to business and working condition.•Economic Factors: Liu and Cheng, (2011), has stated that changes in the economic environment related to the recession or inflation of the nation affect the financial statusof the firm. The recent recession has completely changed the purchasing pattern of customers, which affects sales and profitability of P&G. Recession decreased purchasing power of consumers which lead to decrement in demand of P&G products in market. Company was forced to decrease its production due to less orders of supply. External economic environment make changes in internal structure of the company.•Social Factors: Hervas-Oliver, Sempere-Ripoll and Boronat-Moll, (2014), has said that it is important to understand socio-cultural factors of a nation before expanding business there. As per this, P&G manages the diversities properly within the working environment by using diversity training. Along with this, the company conducts a variety of programs for development of societies. Customer survey and culturel analysis provide data and information about requirement of local consumers in a betterand effective way and it helps the company to develop its product.•Technological Factors: Yu-bing, (2012), has demonstrated that technology plays an essential role in present time. It is helping companies to produce higher quality products. As per this, P&G is using new and latest techniques for increasing its marketshare. It is continuously investing in technological research and development field. By adopting open inovation strategy company replaced its existing old manaufacturing machines with latest technology machines. Electronoc monitorind system has been implanted by P&G to monitor its operational process. It improved overall productivity ofthe firm in terms of consumer satisfaction and product quality.•Environmental Factors: Gokhberg and Kuznetsova, (2011) has found that P&G is supporting the objective of climate R.E.S.O.L.V.E. (Responsible, environmental, steps,opportunities to lead by voluntary efforts). It is also following the policy of sustainable environment. Company is working towards decreasing its carbon emission and greenhouse gases by adopting innovative technology machines which helps the company to reduce pollution at work place and surrounding community.•Legal Factors: Rothaermel (2015), has identified that it is crucial to go along the laws and regulations formed by the government of nations.Consumer protection act and employee welfares acts are followed while forming policy of the firm. Guidelines given by state for taxes and industrial action are obeyed by the firm for working according to laws and legislations of the state.Therefore, both compliance and non-compliance legislations are implemented by the P&G.Market StructureAccording to the Keceli, (2011) Monopoly refers to the market structure in which a company owns nearly all the market for a type of product or service. The market structure of P&G is characterized as a monopoly. The company has few competitors (Unilever, Nestle, etc.) in the healthcare, hair care, cosmetics markets and other household fields. Additionally, Wu and Lin (2011), has argued that in monopoly, the lack of competition results in low quality and high price products and services. In this context, P&G has a strong competitive strength with Unilever, and it is providing high-quality products to users to maintain its leading position at a global level.The organisation offers its services to more than 180 nations which include Asia Pacific, Europe, North America and more.6

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