New CEO Procter & Gamble makes big changes

New CEO Procter & Gamble makes big changes

Barely two weeks after his comeback as head of the world’s largest company of consumer goods, CEO of Procter & Gamble A.G. Lafley has made some big changes: the structure of the group will be simplified and the four divisions all get a new manager, who will report directly to the big chief.

Large reorganisation at the top

Two weeks ago Procter & Gamble surprised the world with the immediate departure of its CEO Bob McDonald and the comeback of A.G. Lafley, who had lead P&G up to 2009. He isn’t wasting time now: he is determined to boost the receding market share of P&G. Sales of P&G grew by 2% last year, while those of rival Unilever grew by 8.7%.


The brand new CEO has implemented a reorganisation of management at the top, while at the same time putting all consumer brands into four worldwide industry groups: one for baby, women's and family care (e.g. Pampers and Tampax), one for beauty products (e.g. Pantene, Olay), one for men's and pet care (e.g. Gilette) and one for cleaning products (e.g. Swiffer and Tide).


The new managers are given the assignment to make their divisions more efficient, make their brands grow faster and to stimulate innovation in their domain.


Possible successor already known?

Next to those four managers, there will also be two senior managers who will report directly to Lafley. Speculation about one of those two being the successor of 66-year-old Lafley when he retires (again) have already started.


"These new assignments mean A.G. is likely to stick around for at least a couple of years in order to ensure that the person who gets the CEO job produces results and earns the support of the other successor candidates,'' said John Wood, a vice chairman of Heidrick & Struggles International.