Procter & Gamble Co. (known as P&G) is a colossus in the sphere of manufactured goods. P&G is a central and principal producer of personal-care products, cleaning agents as well as pet foods in the U.S. Moreover, P&G performs operations in approximately 80 countries worldwide and merchandizes about 300 types of items within 160 states. The current paper will analyze CEO, leadership style, and philosophy of P&G. It will define CEO personal and organizational values, their influence on ethical conduct, together with strengths and weaknesses of P&G’s CEO.
Alan George ‘A.G.’ Lafley embraced P&G as CEO in 2000. After that he has been very prosperous in enlarging gross revenue by 110 percent and tripling earnings (DuBose & DuBose, 2014). Lafley, who is not only CEO, but also the organization’s chairman and president, believes that the prospective P&G would be a much simpler and less synthetic organization of headmost brands that would be much lighter to control, direct and manage (Green, 2013). The CEO states that the major principle of Procter and Gamble is that their consumer is the boss. Therefore, this principle determines the main strategy, philosophy and politics of Procter & Gamble CEO.
P&G develops leaders whose objective stands focused on enhancing consumers’ lives in all parts around the globe. Moreover, these leaders should also concentrate on increasing the number of consumers (DuBose & DuBose, 2014). Therefore, P&G utilizes two-dimensional manner of leadership as it is interested in the production as well in their clients. People are believed to be the major asset of P&G. Democratic leaders have absolute credence and conviction in their subservient(s), and they provide their subordinates with the ability to make decision for themselves (Lafley, 2008). Such type of leaders constantly stimulates their subordinates with the repay for gaining objectives and motivates them to announce new ideas and opinions. In case of P&G, a democratic leader builds the company from within. P&G respects all workers and clients and therefore tries to propose them their credence under the terms and conditions, which customers and employees treat in a similar way (Lafley, 2008). In addition, servant leadership is also an important constituent of two-dimensional manner utilized by P&G’s CEO, as the company acknowledges that customers are their boss. In case of servant leadership, leaders place the requirements of their customers first. The overall leadership philosophy of P&G CEO is defined as “Build from Within” (Green, 2013).
This philosophy assists in tracking the accomplishments of each manager in a quite particularized style. This philosophy avows that a manager is prepared for the next stage. In accordance with Lafley, each of the best 50 job places already has at least three substitution applicants in a line. It is obvious that a culture of innovation is crucial for the overall P&G’s prosperity and performing. Facts demonstrate that the company is the major and governing innovator in their sphere and industry. They deposit more than $350 million in the overall client cognition to define innovation possibilities (Dyer & Gregersen, 2012). Moreover, the company is defined to be the most innovative producer in the sphere of clients stocked and parceled production for the last ten years (Dyer & Gregersen, 2012). The facts demonstrate that P&G operates actively with more than 85 networks and more than 120 universities (Lichtenthaler, 2011). In fact, at least 75 percent of their researches in these networks and universities lead to workable and practicable innovations (Lichtenthaler, 2011). Moreover, P&G practices the strategy of “open door” for unrequested innovation proffering. This strategy is known as “Connect & Develop”, and it allows generating approximately 4,000 initiatives each year (Kerber, Damouni, & Wohl, 2013). Therefore, two-dimensional leadership style and philosophy ideally align with the overall company’s culture, as they strengthen the chosen politics and allow their employees understand and feel what is the most significant for the company (DuBose & DuBose, 2014).
The company’s purpose, values and principles are the fundamental grounds for Lafley’s leadership style and philosophy (“Our Foundation,” 2014). The purpose of P&G is to consolidate all its employees in a mutual pretence and enlargement strategy of enhancing consumers’ lives in miniscule, but evident and significant methods every day. P&G desires to brand goods and accommodations of best caliber and price (“Our Foundation,” 2014). Consequently, P&G clients will repay the company with leadership revenue, financial returns, and value origination. This strategy of Lafley motivates P&G employees to constantly create assertive contributions to P&G’s values, which create the mood of how the employees operate with each other and with their associates (“Our Foundation,” 2014). Finally, Lafley’s principles express P&G’s exceptional strategy of performing work each day. Innovation culture is the vocation assertion of P&G in which they claim that their client is their actual and genuine boss (“Our Foundation,” 2014). Therefore, P&G’s client should be the focus of all P&G actions, starting from the stage of idea creation and ending with the product purchasing. In addition, P&G employees are anticipated by CEO to create an inclusive working culture, which will welcome and embrace diversity. The company creates environment, in which employees and clients feel convenient not paying attention to their personal discrepancies, skills or individual features (“Our Foundation,” 2014). Such kind of environment equips each person with identical access to data, possibilities and incorporation, which allows everybody to learn, develop, excel and maximize their individual indemnity. Lafley believes that the formulation and shaping of values, their understanding and ability to live and work according to them is crucial (Green, 2013). He is sure that in case when the leader does not set the norms, they will not work. All workers watch every move their leaders make and do not make (DuBose & DuBose, 2014). If the leader himself/herself does not sincerely live according to the values and norms, this leader will lose his/her employees. Therefore, personal values of P&G CEO are also very important. Thus, Lafley values truth, cooperation, creativity and knowledge (Green, 2013). All of these values are of particular importance for P&G, and Lafley lives and operates according to these values and principles, which allows building strong and successful company (DuBose & DuBose, 2014).
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Ethical conduct among managers is crucial in companies due to the fact that leaders create the moral manner of the company and perform as role samples. Ethical leaders create and shape trust in the companies. In case when employees observe their leaders conducting themselves unmorally, there are chances that the employees may be less predisposed to act morally and ethically themselves. Despite the fact that organizations may have emitted codes of ethics, the major norm stands for the fact whether leaders support and sustain those values and norm themselves (Green, 2013). Lafley considers that without wholeness and integrity, there can be no trust. In fact, the overall P&G CEO’s leadership is grounded on trust. This value is very important as ethical conduct of Lafley merits trust of employees, clients and suppliers. P&G CEO is considered to be ethical, and therefore he has a tendency to be more accredited and better treated (Kerber, Damouni, & Wohl, 2013). Lafley attempts to cut corners, which allows enhancing ethical behavior within the company (DuBose & DuBose, 2014). Organizational and personal values of CEO allowed the company to formulate the integrity and cooperation, which are very important for ethical conduct. Employees understand all principles and norms of the company they work in, and they are ready to the fact that the customer is their boss and the major strategy to serve customers’ needs lies in ability to innovate (DuBose & DuBose, 2014).
Lafley is very successful. He definitely has numerous strengths; however, there are some weaknesses, which can impede the company’s results and integrity. The first strength of Lafley concerns assertiveness. The company’s CEO is human-oriented (Green, 2013). However, when Lafley has to make a judgment or a decision, he should make it. It concerns assertiveness. In fact, Lafley’s discernment or decision can define prosperity and collapse of the company. P&G’s CEO can be used as a bright sample of how appropriate and perfect discernment and decision is evolved (Green, 2013). Lafley became P&G’s CEO in 2000, when the organization experienced huge difficulties. As for now, the company has enlarged gross revenue by 110 percent and tripled their earnings. The second strength concerns perfect administrative ability (DuBose & DuBose, 2014). In fact, if CEO does not have administrative ability, then assertiveness, education, and creativity will not matter at all. Lafley manages employees to perform effectively and leads the organization to perform work appropriately. He utilizes this kind of capacity in order to determine P&G’s values and norms that stimulate proper conducts. In addition, Lafley has an official capacity to cognize and acknowledge his subordinates (DuBose & DuBose, 2014). Therefore, Lafley knows the top 500 employees in P&G. The third strength concerns cooperativeness (Kerber, Damouni, & Wohl, 2013). Lafley accentuates collaboration with subordinates. He stimulates teamwork among managers, employees and CEO itself. Lafley, as P&G’s CEO, not only interacts with inner staffs of the organization, but also formulates an ideal strategic partnership with other organizations.
Nevertheless, there are some weaknesses of P&G’s CEO (DuBose & DuBose, 2014). Firstly, Lafley can sometimes cross the subtle line between training or staff education and micro-managing. Sometimes it is perceived negatively and might ruin integrity. Secondly, the CEO sometimes discourages independent work among organization’s employees, at the same time subjection to the leader and CEO increases (Green, 2013). This leads to a decreased level of innovation among P&G staff, and organization wholly depends on CEO. Thirdly, Lafley accentuates on their clients only, as the major principle demonstrates that their customer is their boss. In case when employees feel less important than clients, they might desire to change the place of work to feel appreciated and required (Green, 2013).
Such quality as perfect administrative ability contributes to Lafley’s success the most. The company is interested in innovation; and due to the fact that the outcome of innovation is typically vague and risky, the CEO leader should always support the employees and encourage them to perform as good as possible. When CEO is supportive, even if the operation does not evolve as planned, the subordinates will not lose their confidence and patience. In addition, Lafley knows all 500 major employees, which also stimulates them to work better and provides the workers with additional confidence (Kerber, Damouni, & Wohl, 2013). It encourages ethical behavior among P&G employees as Lafley follows all values and norm himself, which additionally stimulates his employees to build integrity and inner support. Administrative ability is probably the most important factor for the company’s success, and Lafley, as P&G’s CEO is a perfect example of ideal administrative ability.
When Lafley became CEO of P&G, the company faced serious problems. The company can be managed, but CEO cannot manage the change. Company’s CEO can only be ahead of this change. These changes define company’s dynamics. Lafley was able to create proper communication and collaboration among his subordinates, which led to serious changes and benefits. Proper communication and collaboration led to integration, which improved company’s outcomes and gross revenue (Kerber, Damouni, & Wohl, 2013). The fact that Lafley is P&G’s CEO, president, and chairman, allows defining the appropriate politics of the company, which creates P&G values and norms. The fact that P&G was able to increase its revenue by 110 percent and triple the overall earnings demonstrates that the chosen politics and policy have positive effects on company’s dynamics (Green, 2013).
The current paper demonstrated that P&G was able to overcome the period of difficulties and collapse as a result of CEO change. The new CEO, Alan George Lafley developed integrity, collaboration, and trust and utilized perfect administrative ability to help the company overcome all difficulties and enlarge its gross revenues and earnings. Lafley accentuates on new philosophy and politics, making their customers their boss. He required new values and principles, which were successfully developed and helped the company to obtain positive dynamics and ideal image.
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