STRT 610 Class 2 Reading Notes.docx - Unileveru2019s New...

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Unilever’s New Global Strategy: Competing through Sustainability 2014, Unilever’s sales growth was only 2.9% -- the lowest in a decade. Shrinking demand due to emerging markets – and forecasting predicted little improvements in 2015 Unilever was implementing a transformational strategy – Unilever Sustainable Living Plan (USLP) o The initiative was not fully embraced by some parts of the organization o Required significant upfront investments that could only be recouped in the longer term USLP was already well off-target on 2 key metrics o GHG impact per consumer increased 4% since 2010 o Water use per consumer had fallen by only 2% Until 2014, Unilever was able to deliver BOTH on its financial expectations and its environment/social commitments – but could it continue this delicate balancing act? Unilever’s Rich History Unilever is from 3 family businesses in the late 19 th century o Netherlands – 2 butter merchants Jurgens/Van den Berg who expanded into margarine o England – inexpensive household soap Lever o Brought together by a common ingredient – PALM OIL Unilever was established on 1/1/1930 through the founding belief that a business would only prosper if it operated ethically and responsibility o Doing well by doing good Unilever’s overseas operating companies (OpsCos) became pretty independent during WWII and it drove Unilever’s growth through the 50’s/60’s. 1990s Unilever struggled to balance the Categories’ quest for global and regional efficiencies with the OpCos’ responsiveness to national markets. After market share/financial performance continued to decline; the first time in Unilever’s history, the board decided to bring an outsider to lead the company in 2009 2009, Paul Polman became Unilever’s new CEO o “we need to know why we are here. The answer is, for consumers not shareholders” o Noticed the culture was “internally focused and self-serving” – froze salaries and cut overseas travel o Replaced CFO, CMO, Global Heads of Foods, Home, and Personal Care o Within a year, changed 1/3 of the top 100 executives Compass Vision o Aimed to double the size of Unilever’s business while simultaneously reducing its

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