The merger of Lever Brothers and Margarine Unie, two European companies, created the company Unilever which has become one of the major players in food, personal and home care market. Unilever competes with Procter & Gamble, owing to its 400 brands, in over 100 countries all around the world. In this document we will analyze how Unilever adapted itself and changed, over the last 25 years. Then we will try to understand how such a big firm, with a complex structure (a group separated into two entities, with PLC and NV), manages multiple brands in various countries.
[...] This is divided into three divisions, function of different areas: Europe; Asia/Africa and Americas Finally, the “functions” pillar regroups the human resource function and the financial function, two critical divisions in the Unilever organization. In practice, this organization leads to the nomination of seven executives, corresponding to the seven strategic divisions of Unilever, all under the responsibility of a “Group chief executive”: - Two executives in charge of the “Category” pillar (Food and Home/personal Care) - Three executives for the “Regions” pillar (Americas; Europe and Asia/Africa) - Two executives responsible for the “Functions” (Human resources and finance) They are all responsible for managing profit and loss and for delivering growth across the different divisions We can first note that the “pillars” of the structure are complementary and have to work together. [...]
[...] Originally, this separation was done to separate the two firms, which originated from a merger to create Unilever (Margarine Unie & Lever brothers). To work efficiently, a unified board operates to manage Unilever, with common directors, at the board of Unilever PLC and NV. Thus, the “unity of management, unity of operation and unity of shareholders right” are important features of the corporate governance With same people on the board of the two companies, the “unity of management” is reached, permitting to the overall group to have common goals, analysis of the situation and commitment to act. [...]
[...] When refocusing on the two main core businesses (Food and home/personal care), Unilever has set up a structure, based on three pillars P. Cescau, “Group chief executive”, argues that this organizational design can facilitate achievement of performance and productivity, thanks to efficiency and constant learning. The first pillar, named “Categories” is represented by the two strategic core businesses (Food and Home/Personal Care). The goal of this pillar is to deliver global platforms, by developing brand, through research and development. Secondly, the “regions” pillar is responsible for management of businesses, deployment of the brand in their own location and managing the relation with customers. [...]
[...] Moreover, the author argues that Unilever identified some best practices and important elements of Kibon's culture, to assimilate them thanks to a process. We will see in the next part that Unilever often choose small or medium firms, when acquiring, and it is thus important to avoid tensions that can be generated when a big multinational takes over a small firm. The human resource policy put in place during the integration can be a major issue to avoid these tensions and gain more from the acquisition. [...]
[...] Future Challenges The latest initiative taken by Unilever was the “Vitality mission”. By reformulating its mission, Unilever clearly delimited its core businesses and defined some responses to know how to overcome the new challenges in the next coming decades. Thus, the innovation will be at the heart of the “Vitality missions”, to give more to customers. Moreover, it has been said in an internal document (7),that the opportunities of new markets in developing countries will be colossal in the next few years, with growing spending and above all growing population ( of the world population in the D&E countries by 2010). [...]
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