Assignment 2 BUS499-final -

Week 6 Assignment 2

Tarronda Jones Ingram

Strayer University

BUS499 Business Administration Capstone

Dr. Keller

Dr. Gardner

August 8, 2019

Proctor & Gamble, Inc.

Proctor and Gamble Inc., which is also named as P&G, refers to an American worldwide user goods corporation whose headquarters are located in downtown Cincinnati, Ohio. The company’s products, which includes foods, cleaning as well as personal care, is widely acknowledged for being an organization with the most efficient business innovations as well as brands management. Based on the organization’s business situation, the company’s success in addressing its operational functioning is generally founded on the determination of how their external environment impacts their operational execution.

The successful operation of the company’s engagement involves the commitment of the dominant forces of competition and evaluations based on analyzing facts, values as well as views of its stakeholders. Also, strategizing on threats as well as opportunities to maximally ensure the provision of personal as well as health care products to the consumers based on its proper use of the available resources as well as the company’s capabilities (Hitt, 2013).

Therefore, based on the company’s prominent market position, the paper explores the concept of understanding the external as well as internal business environments as a firm’s essential capability in making the present as well as future predictions on its operational system.

General Environment

Proctor and Gamble has an unstable environment; however, when it comes to their ability in as well as surviving in such an environment, significant efforts have been generated to sustain its efficiency.

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Based on the global climate, Proctor and Gamble incorporate diverse segments which are organized around its product lines ranging from beauty, family care, fabric, home care as well as health care products. On the company’s global segment, which includes critical political events as well as significant worldwide markets, the company must productively gather information required in understanding the global events that majorly impact their business operations. For instance, based on global issues involving increased birth rates in a specific country, the company has to gather information relating to the needs of the consumers, thus ensuring the proximate provision of the adjacent products. Besides, based on the fluctuating U.S economy, the company majorly takes part in sustaining their abilities to work as well as efficiently survive despite the global challenges on declining economies that affect their current as well as future strategies (Reavis, 2017). For instance, P&G’s sustainable economies are ensured based on the majority sales and earnings obtained from its fabric care and home care segments, thus successfully guaranteeing the value of its competitive advantage at the global marketplace.

Five Forces of Competition

The production of goods which are close substitutes in different organizations constitutes the development of an industry. Therefore, in the course of producing and selling products with close substitutes, the companies influence one another hence creating a mix of strategies used for pursuing in the global competitive market. In this case, the companies in the same industry develop strategies within the forces of competition which include; the bargaining influence of the suppliers, consumers, rivalry among the firms, and the risk of fresh entrants as well as the risk of substitute goods in ensuring upheld competitive advantage. In this case, Proctor and Gamble’s competitive advantage is generated by the forces of can thereby be grouped as either horizontal as well as vertical forces. For instance, Proctor and Gamble’s horizontal forces are highly based on quality as well as innovation, whereby competing firms such as Gillette and Colgate Palmolive only present substitutes such as Colgate for Oral-B. Besides, based on the company’s “Connect and develop” collaborative strategy, the company has been able to ideally connect as well as creating worldwide partnerships such as with sole inventors on the approach of fighting rivalry among competing firms as well the threat of new entrants and alternative products (Reavis, 2013). Based on the concept of its universal vertical forces, the company’s capability in keeping average pricing with its suppliers while increasing the bargaining power of its consumers ensures efficient evaluation of its operational functioning, thus constituting to its sustained competitive advantage.

Evaluation

The careful study, as well as interpretation of information and data from diverse sources, shows an organization’s effective evaluation processes. This helps an organization strategize on the existing forces of competition, thus ensuring specific implementation of policies or decision making based on the production and sale of its commodities. For instance, based on the P&G’s horizontal forces, the company’s evaluation process regarding issues concerning rivalry, new entrants as well as the ease of goods substitution relies on strategies that involve third parties to perform certain functions, such as distributing as well as supplying. Based on the concept of evaluating price-sensitivity among the consumers, such as through online marketing whereby the platforms involves the consumers to give feedback on either the price or overall functioning of the commodity, the company has thereby been able to establish a bargaining advantage that ensures low price keeping of its products.

Future Improvements

An efficient evaluation process of an organization also considers the impact of specific changes to the current as well as future improvements of the company. This includes the comparison of an organization’s goals to the competitor’s objectives, the emphasis of operating efficiently in the future as well as the measure of risks that can be avoided. Looking towards the future to maximize profit, P&G used the well-known gardening principle of pruning or cutting back for growth. In 2014, the company announced a plan to reorganize. Proctor and Gamble sold 100 of its brands to redirect resources and focus on growth strategies for 65 of its core brands (Forbes, 2018). New competitors, as well as rivalry among brands, were a critical risk that would ensure poor management that resulted in an organization’s inability to carry out its set goals. Therefore, the concept of reducing its brands to 65 in number supplied emphasizing guaranteeing effective management process on the few brands that maximally constitutes to improved profits realization. On the prospect of vertical forces, maintaining fixed supplier prices while keeping low prices to the customers ensures reliable decisions on increasing the market range of its products, while upholding its global competitive advantage.

External Threats and Opportunities

While founded on covering a range of customers, globalization as a result of economic interdependence across different countries is an existing threat towards efficient operation of its commodities production and sale. This hinders the expansion of its business operations into other countries, based on the concept of increasing inflation and business barriers. However, the available opportunity for Proctor and Gamble is based on the maximum utilization of trends as well as the current advancements in technology. Besides, this causes an alteration on P&G’s traditional operation to new competitive landscapes enabled by the opportunities provided by the advancing technology. For example, the replacement of the company’s conventional operating practices was enhanced by technology advances such as E-commerce and digital marketplace.

Threats and Opportunities Strategies

Based on the threat caused by interdependence of many countries, Proctor and Gamble strategized on making an expansion for its operational existence through opening another full-fledged headquarters in the United States. This approach thereby ensures its extensive geographical coverage that supplies a wide distribution of its variety of commodities, ranging from personal to hygiene and health care products. Based on its available opportunities in connection to technology resources, the company’s strategy in obtaining a global customer base is enabled through maximum use of E-commerce, online, and digital market services. E-commerce has allowed P&G to change its marketing infrastructure and streamline related processes. The digital marketplace has afforded the company rebranding mechanisms to re-establish customer loyalty and implement an aggressive marketing strategy for the expansion of customer base. However, thereby applicable with the increasing knowledge intensity that ensures deployment of marketing features such as Gillette Ad and The Talk, to the approximate reach of more customers.

Strengths and Weaknesses

On the pace of organizational development, strengths equip a firm to strategically invest in its capabilities while working to decrease the inability to meet its goals generated by an organization’s operational weaknesses. For instance, based on the organization’s statements, the company discovers a large compact hence giving its profile to the considered future. For example, its apparition account, “To be the best consumer supplies company in the world,” its position is therefore conventional to be the foremost universal online vendor of physical fitness and care commodities. While, its operation account, “To supply identified, advanced and value that progress satisfy the wide range of customers, currently and for generations to come,” promises the satisfaction of its customers’ needs (Forbes, 2018). However, the weakness is based on improper implementation approaches to attain their objectives. These ranges based on the workers’ efforts in adhering to the implemented strategies to generate change on the outlook of obtaining the organizational goals.

Strategy

A resource-based model equips Proctor and Gamble with the efficient mechanism to weigh its strengths as well as weaknesses, thus generating an operational framework for development. Therefore, a structure on ensuring the company’s considerations of its exclusive assets, including culture, reputations, objectives as well as capabilities are the motives for sustained development. For instance, endorsing policies and guidelines that involve maximum participation of the employees in the diverse organizational operations guarantees efficient and effective production of the organization’s merchandise. However, maintenance of P&G’s culture throughout achieving its set purposes whereas preserving appropriate exploitation of its potentials will promise continuous aggressive strength, hence achievement of its set vision and mission statements.

Resources, Capabilities and Core Competencies

In the achievement of its set goals; assets, capabilities, as well as core competencies, primarily function in sustaining the company’s development. The resources include capital and technology advancements that foster the quality production, purchase as well as distribution process to the customers. P&G’s capabilities derived from its location, culture as well as the reputation of quality products of personal, hygiene, and health care products maximally enhances a global consumer base. Besides, based on the setting of the company’s chief offices in Cincinnati, it eases some of its responsibilities such as direct shipping to customers, hence positive reputations that ensure more exceptional proceedings of the company (Keisler, 2016). Based on core competencies, the company’s condition, as well as value in the products, is widely based on the approach of ensuring sustainable competitive advantage. For instance, this incorporates valuable organizational capabilities such as in making decisions as well as implementing policies that add value to the consumer needs satisfaction. With this approach, P&G’s proper management system, which includes methods in availing eminent products to its consumers under different schemes of operations, the business reflections and gratifying strategies to its financing staff, would participate in guaranteeing extent for expansion in its various functioning.

Sources

Forbes, H. L., & Schaefer, D. (2018). Crowdsourcing in product development: Current state and future research directions. In DS 92: Proceedings of the DESIGN 2018 15th International Design Conference (pp. 579-588).

Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2013). Strategic Management: Concepts and Cases: Competitiveness and Globalization (10th ed.). Mason, OH: South-Western Cengage Learning.

Keisler, J., & Romar, E. (2016). Core Competencies, Core Values and Core Compromises.

Reavis, M. R., Tucci, J. E., & Pierre, G. S. (2017). Corporate Social Responsibility and Millennials’ Stakeholder Approach. Journal of Leadership, Accountability, and Ethics, 14(4).