Skii Globalization

P&G JAPAN: THE SK II GLOBALIZATION ANALYSIS

This case analysis examines P&G SK II as to whether it has the ability to develop into a global brand, which markets were most important to enter now and how the implementation should be done in their newly reorganized global operations. The first chapter of analysis talks about the problem identification. The second chapter analyzes and evaluate the problems and the final chapter provides a diagnosis to the analysis.

Chapter one: Problem Identification

The key problems identified in P&G were:

1. Re-structuring of the organisation

P&G matrix structure was seen as an impediment to entrepreneurship and flexibility which led to a massive organizational change. The Organization 2005 brought the most drammatic change to P&G culture, processes and structure. This lead to loss of jobs, closing down of plants, and new roles of responsibility. Naturally people fear change and these reforms initially must have met resistance. Again, the company’s initial structure was built on a portfolio of self-sufficient subsidies run by the country manager. The Global Business Unit (GBU) took over profit responsibility historically held by P&G country-based organizations and new roles such as developing global strategy and qualifying expansion markets were assigned. These certainly creates conflict between the GBU and the country managers since the country mangers were still accountable for losses but didn’t have enough room to initiate their market and expansion strategies.

2. High cost of Manufacturing and Company Restructuring

The cost of running all the local product development labs and manufacturing plants were limiting profits. This was as a result of P&G adapting to the local market’s needs. Each product in the market has to be localised thereby increasing lab research and re-engineering manufacturing process to produce that product. Also the radical organizational restructuring cost 1.9...