Strategic Management for Procter & Gamble: SWOT and PESTLE Analysis

This report presents a strategic management analysis of Procter & Gamble, including its history, mission, and vision. It also includes a SWOT analysis of the company's internal environment and a PESTLE analysis of its external environment. The report highlights the company's strengths, weaknesses, opportunities, and threats, and how political, economic, social, technological, legal, and environmental factors affect its operations. The report concludes with recommendations for further improvement.

STRATEGIC MANAGEMENT

EXECUTIVE SUMMARY
The report is intended to present an intensive organizational strategy in order to be
competitive and lucrative in prevailing market circumstances. With this regard Procter & gamble
company has been taken. The report has depicted background information of this organization
such as its foundation, ownership and course of actions. To perceive the organizational strategy
deeply, its mission, vision was also scrutinized.
For analysing both internal and external environment where business is getting operated,
a range of models were used. To analyse internal business environment SWOT analysis was
carried out, and for external business environment PESTLE analysis has been taken into
consideration. From this report it can be deciphered that despite having severe competition in the
market the organization is notching up sort of favourable notions. Here, its strategic factors were
critically analysed in attempt to extend some recommendations for further betterment and
eradication of prevailing bottlenecks, which are having potential to bring catastrophe to Procter
& Gamble.

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................4
MAIN BODY...................................................................................................................................4
Task-1..............................................................................................................................................4
Procter & Gamble (P&G)............................................................................................................4
Vission of P&G............................................................................................................................6
Stakeholders of P&G...................................................................................................................6
Task-2..............................................................................................................................................7
S.W.O.T. Analysis ......................................................................................................................7
PESTLE Analysis........................................................................................................................9
TASK 3..........................................................................................................................................10
Critical analysis of Procter and Gamble business strategies......................................................10
TASK 4..........................................................................................................................................12
Conclusion and outlining the areas of P&G business strategy and recommendations for further
improvement..............................................................................................................................12
CONCLUSION..............................................................................................................................15
REFERENCES................................................................................................................................1

INTRODUCTION
The process of planning, organizing, implementing and assessing a strategy is called
strategic management. Changes in the internal and external environment of the organization
forces the management for planning and evaluating different strategies to be pursued for profit
maximization and smooth running of the firm. This process of strategic management enables the
organization's long term sustainability and helps to determine a direction in which the firm has to
operate. These plans enable the organization to develop a competitive edge over its competitors.
Maintaining the existing customer base and targeting the new ones with different tactics is the
main focus of strategic management.
Procter and Gamble is an American multinational firm founded in 1837 by William
Procter and James Gamble (Muhamad, 2021). Company deals in personal care products such as
beauty products, hair care products, baby and feminine hygiene products etc. establishment of
P&G has been flourished in the different parts of the world offering their customers with a wide
range of product and services.
The following report will be highlighting the past and present scenario and the futuristic
strategies of the organization. Successful strategies that would be followed by the organization to
attain profit in past few years will be discussed.
MAIN BODY
Task-1
Procter & Gamble (P&G)
Procter and gamble is a U.S. based organization and its headquarter is located in
Cincinnati, Ohio. The organization currently operates in many countries globally. The brand has
evolved with the time in various market segments with different product and services. In the past
times the brand dealt in food industry with Pringles (Leiblein and Reuer, 2020). In the initial
period the company made little profits but during the American civil war the brand took up road
towards success by winning the contract for supplying of soaps and candles to the union army.
The company was recognized in the market when they launched an inexpensive soap called
Ivory with “floating soap” USP. Diversification in the ranges of products was obtained in early
19's by producing vegetable oils. In mid 19's the company started establishing their factories and
outlets in different countries. With the acquaintance of Thomas Hedley Co. the company entered
the markets of UK. Over the period of time the company grown into many different branches by

introducing different products such as Tide detergent, Prell shampoo, toothpastes etc. The star
product of the company that is Pampers diaper got popular and became most profitable with the
time. From the year 2000 to 2014 the organization acquired many big brands such as Folgers
Coffee, Pantene, Gillette, Richardson -Vicks, Max Factor etc.
From 2014 onwards the organization realized the wide diversification is leading towards
the loss in quality and decided to drop almost 100 product brands so that they can focus on the
specialization in the specific products which are giving high profits to the firm. Vicks, some of
the unpopular beauty brands and Duracell were among these dropped brands.
The strategies that are followed by Procter & Gamble throughout this evolution were:
Innovation
The organization keeps innovating their product to meet the needs of the customer and
gain a good customer feedback (Bulturbayevich, 2021). They invest in R&d of their product so it
can cope up with the changing preferences of the customer and increase the customer retention
rate. Products offered by the company are modified time to time so that it can gain relevance
with the customer needs.
Customization
The company focuses on the higher customer satisfaction rate by following the policy of
customization according to the customer. The example of this philosophy of the company is
pampers as they customized it in accordance with the needs of parents after critically observing
the situation.
Diversification
Diversified ranges of products and services offered by the company helps them target
higher customer base of different segments (Barney, 2020). The brand provides range of beauty
products, health care, home and fabric products, baby care products etc. which attracts the
customer by providing major care products in one place.
Securing the innovation
Wide ranges of innovated products in different segments is the key to success of the
organization. The organization believes in protecting their innovation and to this they apply for
patents for different innovation which acts as a barrier for its rivals top copy the product.
Acquiring best talents

To provide the customers with the best products and services the company hires the best
candidates for the respective roles and provides them with good training. Specialized employees
for every role leads to the overall specialization of the organization.
Vision of P&G
In the initial years the organization wast started with just 2 products soaps and candles
but with the period of time the organization changed its vision towards wide diversification
which led to the non-specialization in the product (Grant, 2021). From 2014 onwards the
company realized the impact of wide diversification and decided to restructure the organization
through selling the brands which are less profitable. The brand focused on quality up-gradation
with limited diversification.
Net sales achieved by the brand in the third quarter of fiscal year 2022 was $19.4 billion
which is 7% higher than the previous year (P&G Announces Fiscal Year 2022 Third Quarter
Results, 2020). Organic sales (excluding foreign exchange) of P&G was 10% more than the last
year. Net profit earned by the firm was $3,367 million which is 4% more than the prior year.
Stakeholders of P&G
There are many stakeholders in the brands such as consumers, suppliers, managers
employees, government etc. the major financial stakeholders of the brand are the board of
directors and senior executives including:
CEO
Chief executing officer of the firm is the major financial stakeholder of the company
possessing major part of common shares of the brand.
Managers
Some managers posses financial holdings in the company and their decision also plays a
vital role in the working and future of the organization.
Board of directors
Top line managers who are responsible for any decision and possess the power to mould
the organization according to their decision. They also have holding in the company.
Heads of different departments

Profit or loss of different departments impacts the overall profitability of the
organization. Heads of these departments have major stakes in their respective fields and in the
organization.
Task-2
S.W.O.T. Analysis
Strengths
Global presence
The brand operates in more than 500 countries to pursue large markets and gain
maximum sales. It is a major strength for the business in order to develop better trust among the
customers. The company offers superior products, service and valuable across all those
categories. Thus, developing the quality service drive the attention from target audience in
industry.
Recognition
It has been years since the brand is being established, through these years they have
maintained their goodwill and gained higher awareness among the market. This is crucial for the
business in order to create better opportunities for the business in the future and achieve better
growth and success.
Prominent brands
Brands like Pampers, Pantene, Head & Shoulders etc. are the giants and recognized as
most preferable brand s among the segment (Benzaghta and et.al., 2021). These brands increase
the profitability of the firm.
Distribution panel
Strong distribution chain allows the wide availability of the product in different markets.
Customer can purchase the products from supermarkets, local shops and from e-commerce sites
too.
Weaknesses
Competition
The brand faces high competition from both local players and internation firms which has
a negative impact on its market share in the industry which restricts its growth opportunities

(Hanson and Kalyanam, 2020). There are various competitors who provide the tough
competition in industry as it strategic aspects to work efficiently.
Complexity
As the organization have many branches dealing in different sectors and segments. It
becomes a harder task to monitor and maintain these branches (Deepak and Jeyakumar, 2019).
There are several branches which requires the stronger workforce to make the effective changes
and working criteria to be effective.
Opportunities
Rural markets
Increasing demand for branded commodities in the rural markets can be an opportunity
for the brand. This will provide brand to improve their brand value in the new and existing
market which would introduce to gain its market share (Kartajaya, Setiawan and Kotler, 2021).
This would cater the growth chances for business as such by going through these it will increase
their stability in the consumer goods industry.
Buying power of customer
Increasing sources of income for the customer has led to the increased purchasing power
which can benefit the company if pricing policy is maintained. It has become easier for the
customers to purchase products and fulfil their satisfaction needs. After the pandemic issues
most of the people drive their attention towards getting the service from online sources which is
the most significant driver to conduct these activities (Edwards, 2021). P&G has the opportunity
to increase their sales through online platforms. Pandemic has also generated the concern related
to hygiene and health measures which develop the strong growth opportunity in feminine
hygiene segments.
Partnership
P&G can acquire or merge with their bigger rivals to eliminate or reduce the competition
in the market (A.Morgan and et.al., 2019). This will be beneficial for the business to increase its
market share in the industry and enhance its customer base.
Threats
Laws

Legal laws and amendments that can impact the organizations policies and working
methods posses a threat to its profitability. These factors may have a negative influence on the
efficiency of the business to procure better results.
Inflation
Increasing price of raw material has resulted in increased cost of production and if this
continues it will affect the pricing policy of the brand (Mustafa, Hena and Zafar, 2018). The
business is exposed and impacted with global macro economic aspects. Apart from this company
also faced supply chain issue due to issues regarding with pandemic.
PESTLE Analysis
Political Factors
Russian invasion of Ukraine is the political factor impacting the organizations working
conditions by effecting the distribution channel. The war has resulted in increased trade barriers
and led to the increase in the cost of raw material and transportation (Shi, 2021). This factor may
have a negative impact on the overall performance of the business.
Economic factors
The company produces and sells their product in different parts of the world thus, the
economic conditions impacts the organizations strategies and plans (Alanzi, 2018). It is difficult
for the firm to maintain uniformity in all its outlets due to this factor. This may reduce its ability
to remain profitable and increase its sustainability in the business environment.
Social Factors
Preference changes due to the influence of foreign cultures forces the company to keep
innovating their product to cope up with the trend and to preferable by the customer. This factor
may have an influence on the customers preferences which may have a significant change in
their buyer behaviour towards the business (Day and Shea, 2021). There are various trends being
highlighted in market to which also drive the negative impact to spending patterns. The strong
organizational culture plays key role for introducing the customer retention and their higher
satisfaction with getting the advantage from business.
Technological factors
Enhancing technology can act as a positive factor for the company if it is used properly.
The brand uses advanced technological equipments and methods to produce their goods and

services to attain low cost production. It increases the development opportunities of the business
in the competitive environment and helps in improving the productivity of the work. The
company should work on innovations such as R&D (Liu and Kong, 2021). By using to the
technological concerns it will be supportive for business to manage their overall productivity and
gain the attention from target audience.
Legal factors
Legal factors acts as a barrier to the diversification of the organization in its merger and
acquaintance with the different brands (Bayo-Moriones, Galdon-Sanchez and Martinez-de-
Morentin, 2020). These factors have previously acted as the hindrance in the acquaintance of
different brands by the company and may continue to do so. There are certain laws and
enforcements which are considered as barriers in the growth of the business.
Environmental factors
Increasing awareness of sustainable development increases the expenses of the
organization as they have to invest in nature friendly method of production and sales. This may
also help the organization to contribute towards the sustainable development of the company in
the business environment (Eikelenboom and de Jong, 2021). Also, they should develop the
sustainability in the highly competitive markets.
TASK 3
Critical analysis of Procter and Gamble business strategies
Advantages -
The Proctor & Gamble organization uses generic strategy to accomplish the competitive
advantage in industry of consumer goods. Its generic competitive strategy define the core
approach to business in achieve the competitiveness. In order with same it influences managerial
decisions in the aspects of marketing as well as innovation. Apart from this growth strategy
depicts the strategic approach to business in driving the consumer goods markets, as such these
strategies directly impact on the company growth aspects and plan of expansions (Nikolaeva,
2018). The main aim of organization is to focus on the innovation terms with the development of
valuable image in respective industry. It develops the major advantage for enhancing the
stabilize position in market and it will increase the service efficiency of work. Business get
various advantages while meeting to the suitable business strategies and for the same it is
essential to develop the strategies seeking to the long term goals which enables company to

further grow. The pricing policy of company is the biggest advantage in gaining the market share
and create revenue. In similar way P&G follow competitive pricing, premium pricing and
penetrating pricing as part of marketing mix. Similarly, differentiation builds the uniqueness of
business and the products to attract target audience and all of a sudden highlighting the quality as
well as value drive towards the better consumer goods.
From the past years, P&G has been part of continuous operations in consumer products
industry and the business pursues to enhance their service to provide competition in marketplace.
Their strategic innovations allow in becoming multi billion dollar global cooperation and
sustained their competitive advantage in numerous of higher contested markets. Business
strategy of organization is suitable and leads to provide mostly beneficial outcomes in managing
the business operations to run effectively. The company also hires the suitable workforces which
is the most significant driving factor for organization success. Such skilled employees play key
role towards organization success and employee retention. The hiring takes place in several areas
which makes the working criteria easier to alter the best service to customers and make the
customer retention more favourable. Overall, the business strategies are suitable for P&G but it
can also lead to some negative outcomes. Thus, innovation strategy increase the chance for
business to get the competitive advantage in industry, developing global research and acquiring
to the best talent and working employees. The culture of organization is different from most of
the organizations and in order with the same it has the good employee retention which drives to
better sustainability (Mavi, et. al. 2019). The workforce complete the task and support each other
to accomplish the goals and objectives of business activities and so on such motivated ans skilled
workforce improve the performance and for their business strategies they can easily take part in
being part of forming up with strategy aspects. The company formulates the quality and valuable
product and service to look for their customer preferences. These factors are supportive in
company efforts to get and leadership position in the industry as compared to other competitors.
Such intensive strategies articulate growth with outcomes of market performance (Suoniemi and
et.al., 2020). By considering to the tough competition in consumer goods markets, it is
mandatory for intensive growth strategies are beneficial and relevant to present markets
circumstances affecting P&G.
Disadvantages

While going through business strategical concerns the disadvantages may occur in the
situations when the effective strategies are not followed with useful measures. The major striking
weakness can be with applying the strategies for the business but focusing more towards other
innovating brands and lowering down the performance measures with decrease in quality of
output. Whereas the differentiation strategy is consisted of risk which can be said that the cost
differential in between low cost competitors as well as differentiated company becomes too great
for differentiation to bear up with brand loyalty (Ali and Anwar, 2021). Buyers will sacrifice
some features, image and service possessed by specialized entity for huge cost savings. By
applying to the departmentalization Proctor and Gamble have to hire most of the workforce to
take place in several areas. The geographical departmentalization is consisted of higher cost in
operations as well as control because of duplication of activities in various division areas. The
operation cost will increase but also influences towards profits.
Hence, another weaker term for business could be imitable nature of products and it
typical in the segment of consumer good markets in which product from several companies
consider similarities. This will directly impact to reduce market share of business, on the other
hand limited online presence can be inadequate for making the online operations (Witcher,
2019). In acquiring the right and skilled employee it would be major concern aspect to drive the
better performance in organization. Poor and unfavourable workforce creates the weaker
performance in organization and impact negatively towards it productive. Before executing to
business plan of action it is crucial to look for the conditions and workforce who can effectively
work in such changing environment and provide the competitive advantage in business activities.
On the other hand there are various competitors in industry who can create for business to run
their operations smoothly. All of a sudden business get many negative outcomes from external
factors which drive to impact their sustainability. In terms of innovations, most of the efforts are
seek to towards the good working and existing brands but P&G has not performed in much
effective ways in new market segment.
The increasing recalls in past few years lead to difficulty for company. Product recalls
like dry pet food and crest toothpaste badly influenced the brand image. The competition also
experienced by competitors such as Unilever and Loreal, also there is also from store brands
Walmart and Watsons (Kitsios and Kamariotou, 2018). According to the research based on audit
it seems that spending patterns of consumers have changed and recently consumer have preferred

to buy store brands over branded products because they are cheaper but also match brand
products. Thus, implementing the strategy towards right place is essential for organization,
without paying attention and expansion to new markets can drive issues for company to deal
with. Wrong markets decrease the revenue and market share for business which articulates the
negative driven factors business and due to which the problem occur and focused in company
slow growth markets.
TASK 4
Conclusion and outlining the areas of P&G business strategy and recommendations for further
improvement
There are various business strategies of organizations which drives the benefit outcomes
conducting the better future outcomes for business. P&G is the well-known company who owns
its most of its customers in favourable terms but due to some negative consequences it reduces
the level of satisfaction. It is essential for organization to introduce some changes and unique
tactics to improve the quality of service for better customer retention. By seeking attention to
those business introduces various strategies such as innovation, customization, diversification,
stepping up and stepping forward, integrated strategy to win etc. These all are aligned with better
future outcomes for company goals and objectives. The differentiation or generic strategy is most
effective as such it is supportive for target the audience towards offering being provided by
entity (Abdullahi, 2018). The generic strategic measure relevant with competitive advantage and
differentiation includes building the uniqueness of business products and services to attract the
target customers. In this current ear most of the customer pay attention towards better offerings
and discounts as it it concerned with their benefits. The audience will choose appropriate sources
of organization which would be providing them benefits as compared to several competitors in
consumer goods industry.
In the context of P&G it highlights the quality and value for catering the best service in
consumer goods to get the achievement in their business valuable propositions. The integrated
strategy is the foundation of powerful balanced growth as well as value creation for current and
long term goals. The strategy is favourable with current challenging environment and
organization focus and strengthen their portfolio in daily use of categories in which performance
drives brand choice. It it to establish and extend the superiority if brand crosswise with product,
packaging, retail execution and communications (Nagel and Aviles, 2021). The main concern of

using this strategy is concerned by business in favour of innovative culture and improve the
focus on various perspectives. These are not autonomous strategic choices but also they reinforce
and develop on each other and when implemented well it leads to balanced top and bottom line
growth and valuable creation.
P&G uses this strategy with belief to put the organization into developing position to deal
with and overcoming to the challenges of macroeconomic environment in which company is
facing. This requires modern innovation and company to create their valuable and stabilize
position in consumer good industry. Furthermore, it is necessary to look after the such outcomes
as such it can be threat for business to run their operations smoothly. Each organization faces
some challenges which impact their work culture and reduce their performance. Proctor and
gamble is concerned with best and effective strategy, and they can cater the best service to their
customers which positively impact to drive attention of target audience. Thus, so on the
challenging aspects can be overcome as such catering the better service quality and offerings to
target segment (Hunger, 2020). So following to the strategy can be effective for business for
strong foundation, valuable creation and balanced growth.
Recommendation on main areas of business strategy which require the further improvement
In elaborating to the business strategy of Procter & Gamble, their business strategies
drives the effective measures for organization success but there are some fundamental
requirements to make the operations more sustainable in such culture and easy to maintain the
sustainable. The organization is working effectively to make the changes and seeking to gain
more business opportunities (Kumar and et.al., 2021). The organization must acquire the skilled
workforce to enhance their services in various sectors by the help of strong workforce it enables
to develop the more relations with target audience. On the other hand, they should use tactics in
more unique ways to introduce the different ideas which leads to immense growth in the market
share of business by driving it sales operations. While defining the targets it is also essential to
be focused on systematic growth and developing the more service factors for customers. The
service must be consisted of providing feedback which enables user to raise their issues and
make their concern with effective solutions.
Focusing towards customer segment is crucial for business as such with higher level of
satisfaction to the customer will drive the company to become successful in managing their long
term procedures. Integrated strategy is overall concerned with long term aspects and innovations

are aligned with the same (Tien, 2019). With the changing technological driven factors company
should follow their methods of conducting business with relevant objective as such it impacts the
profit drivers and some parts of business. Thus, the strategy will be crucial for organization for
all the factors related to its services and operations, for the same they should be specific with
their goals and state clear vision for what is to be achieved. It can be done by planning
effectively, measuring the success criteria for long term, checking the objectives for time and
resources for better achievement. The most necessitate part of this to look for strategy will drive
the success in carrying out the outstanding performance of business in future and realistic with
driving the profits as well as enhancing business activities. The insight of business is essential for
applicable in planning the business strategies, for internal and external it is essential to seek the
working ability of strategy. The effective planning sources drives the business to make the
competitive advantage in more favourable terms. Overall, thee business strategy of P&G is
effective and it will drive various growth aspects for the organization to stabilize their
positioning, by effective use of resources they can increase their valuable image for customer
driven factors. The aim of business for developing brand, innovation, consumer understanding
can be fulfilled with covering to all these aspects of business and so on this may provide positive
impact on business. Although, the company will be named by highlighting the quality as well as
value in consumer goods and develop the uniqueness of enterprise and their products to attract
target customers (Vlajkovic and Enkhmandakh, 2021).
CONCLUSION
From the above text it had been summarized the overview of Procter & Gamble which
describes there past performance of 5 years. It critically evaluated the vision and mission of
organization by which it seems that organization is following various effective strategies for
development and with the aim of facilitating better future outcomes. Furthermore, in another task
it has been summarized the internal and external factors of business by take into consideration
the strategic models such as SWOT and PESTLE analysis. By using these models the overall
internal and external factors are articulated which shows the current operations and challenges
being faced by organization. Apart from this using previous analysis of the organizations it
critically evaluates about the organization strategy by discussing the advantages and

disadvantages in terms of what measures it will articulate for organization. At the end of the
report it depicts the strategy is beneficial for organization growth terms and such innovative
measures will improve their positioning as well as stability in marketplace. Integrated strategy is
being followed by organization for innovation and strong balanced growth to which company
will focus on strengthening their portfolio in daily use of categories. Moreover, the conclusion
are provided explaining the further areas of improvement in the business strategy of P&G and
how effectively it will provide the benefit to the organization and its operations.

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Online
P&G Announces Fiscal Year 2022 Third Quarter Results. 2020. [Online]. Available Through:
<https://pginvestor.com/financial-reporting/press-releases/news-details/2022/PG-Announces-
Fiscal-Year-2022-Third-Quarter-Results/default.aspx>

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