L'OREAL, world leader in the cosmetics market, was founded as family enterprise in 1909 by the chemist Eugene Schueller who marketed products that he himself conceived and produced, at the Parisian hairdressing salons. This spirit and the values attached to it are what cements the group and allows it to dominate the market of cosmetics today. The L'Oreal group was born with the launching of hair color on the market, a real innovation, which was the first great success of what was going to become the leading company in the cosmetics market. In 1912, the group started to go international by exporting its products in France, Holland, Austria and Italy. During the century the L'Oreal group did not cease to maintain its course of action that is to say "innovation and communication". The Research department was developed to meet the needs of innovation and has continuously grown. The group which started with 3 researchers in 1920 has more than 2823 to date. Today, it is quoted on the stock exchange and has more than 400 commercial subsidiary companies and about fifty factories throughout the world.
[...] Acquisitions targeted abroad with Jade in Germany and Maybelline in the USA (make-up), the American companies Soft Sheen and Carson in ethnic cosmetics, and the Japanese company Shu Uemura. Threats Direct sales (mail order and door-to-door selling) fell by after increasing for 10 years. Increasingly constraining regulations. Threat of competition: Procter & Gamble: - Acquisition of the German company Wella (8th in the sector of the shampoos and colorings occupying 2nd place in this segment), Clairol and Jean Patou perfumes. [...]
[...] Last year, for example, L'Oreal acquired the American company SkinCeuticals and Unilever's prestigious fragrances were acquired by Coty in order to improve the position of its company Lancaster Worldwide. In the cosmetics industry, competition is more a function of innovation than price and promotion. Innovation is thus an asset which relates to the competitive intensity. The competitive intensity in this sector is thus very strong. Substitution and innovation: A true substitute does not exist, thus we do not see any threat. [...]
[...] During the past century, L'Oreal has seen enormous changes and it today has: - a head office L'Oreal SA Paris - 290 subsidiary companies and a presence in 150 countries - a staff of 50,491 - more than 40 factories in the World - an investment of of turnover in research with 2800 researchers and 500 patents registered each year. The former chairman, François Paves, who headed the group for 43 years strongly insisted on the quality of L'Oreal researchers which makes it possible for the group to annually register more than 500 patents. [...]
[...] This is L'Oreal's strategy for the motivation of personnel. The structure and the function of L'Oreal's Human Resources on a global level: L'Oreal does not have a formal organization chart. That is one of the consequences of the oral culture of L'Oréal. This culture preempted a rather complicated company structure. The diagram below shows an example of this complexity while trying to represent the structure of the Human Resources function on a global level. The role of the Management of further corporate education is to write and circulate its policy and to take care of its implementation and to recruit, motivate and professionalize the Development & Training teams, and finally to propose Group training courses in the field of the managerial development and company culture. [...]
[...] In fact, this corporate structural level (management) aims to fix the strategic orientation of the company and to be a support for the operational levels. At the geographical level: multi divisional zones. L'Oreal has divided responsibilities by geographical sectors in order have proximity while keeping a privileged relationship with the French management (the head office of L'Oréal Latin America is in Paris). The structure of the large French firm is really complex and one can say that one person in the company must debrief several people. [...]
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