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M26BSS
STRATEGIC MANAGEMENT
Group A11
Qilin Lou 5213030
Yuqi Yang 4204079
Fei Xue 4547851
Aziza Bendera 5399219
Mohammed F...
1. Introduction
2. External Analysis
3. Internal Analysis
4. Product Diversification
5. Mergers & Acquisition
6. Corporate...
About Unilever
• Multinational firm (Dutch and British Joint Venture)
• Founded in 1930
• 400 brands, 100 countries, 17400...
External Analysis
PEST Analysis
Technology:
1. Development of e-business;
2. High level of automation;
3. Advanced technologies
becomes a th...
SWOT Analysis
Strengths
1. Operates around many countries
2. Strong portfolio of brands
3. Diversified product range
Weakn...
SWOT Analysis
Strengths
1. Operates around many countries
2. Strong portfolio of brands
3. Diversified product range
Weakn...
Five Forces Analysis
Existing competitive
rivalry between
suppliers
1. Number and size of
competitors
2. Strong distributi...
Internal Analysis
Resource Audit
Resource Competence
Threshold
capability
Threshold Resources
Tangible:
Human resource(174,000)
Intangible:...
Stakeholder Analysis
Corporate-Level Strategy
Analysis One
“We add vitality to life”
Corporate Vision:
• We work to create a better future every day.
• We help people feel good look...
Product Diversification
• Strategy 1: Brand Power
•Strategy 2: Innovation
•Strategy 3: The Best Talent
•Strategy 4: Sustai...
BCG Matrix
Household care(6.2%)
(Surf Excel,Cif) Refreshment(1.8%)
(Supreme Tea)Food(2%)
(Wall's)
MarketGrowth
Market Shar...
Corporate-Level Strategy
Analysis Three
M&A
Unilever emerged from a merger.
Trend:
 From 1937 – 1978 Unilever made numerous acquisitions under the
strategy: Ri...
Resource: Riley,J (2010)
Corporate Strategy: Path to Growth (2000-2004)
Downsized from 1600-400 brands, make room for high profile
brands like Ben...
Corporate Strategy: Growth to vitality 2004-2010
 Focus on 40 Mega world brands > billion $
 Focus on developed and emer...
Risks associated with M&A:
 Too large (too diverse) + decentralised structure= slow growth
 Inability to achieve synergy...
Corporate-Level Strategy
Analysis Four
CSR
Unilever in the Victorian England era
•Motives : Strategic leadership
Unilever during world war I, II post war activ...
Unilever Sustainability Living Plan (USLP)
2010-2020
Has three main goals
 Improve hygiene & nutrition (People)
 Halve g...
USLP …
 „Glocal‟ Marketing strategy and social projects
e.g. Project sunlight, “love your heart” and “Brush Day and
Night...
Conclusion
and
Recommendations
Conclusion
• Unilever offers value in terms of price and quality
• Initiating projects to improve and manage the
environme...
Recommendations
Although Unilever is already on the brink of its success but there is
always room for improvement.
• Being...
References
Angwin, D., Cummings, S. and Smith, C. (2007) The Strategy Pathfinder: Core Concepts and Micro-cases, Oxford :
...
References
Unilever HR management (2013) [online] available from
<http://www.unilever.co.uk/Images/6550_Unilever_MBY_6pp_H...
Thank You
Any Questions
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M26 unilever presentation

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M26 unilever presentation

  1. 1. M26BSS STRATEGIC MANAGEMENT Group A11 Qilin Lou 5213030 Yuqi Yang 4204079 Fei Xue 4547851 Aziza Bendera 5399219 Mohammed Faham 5323052
  2. 2. 1. Introduction 2. External Analysis 3. Internal Analysis 4. Product Diversification 5. Mergers & Acquisition 6. Corporate Social Responsibility 7. Conclusion & Recommendations Contents
  3. 3. About Unilever • Multinational firm (Dutch and British Joint Venture) • Founded in 1930 • 400 brands, 100 countries, 174000 employees • Fast-moving consumer goods • To meet everyday needs of people everywhere in the world
  4. 4. External Analysis
  5. 5. PEST Analysis Technology: 1. Development of e-business; 2. High level of automation; 3. Advanced technologies becomes a threat as it makes copy easier. Political: 1. Unilever is subject to laws and regulations both locally and globally; 2. Volatile of emerging market; 3. Involvement of governments and regulatory authorities. Economic: 1. Current economic recession affects consumer‟s behavior; 2. Reduced consumer wealth. Socio-culture: 1. Has developed a strong corporate reputation; 2. Socially responsible company; 3. Conscious about safety and health of its employees. PEST
  6. 6. SWOT Analysis Strengths 1. Operates around many countries 2. Strong portfolio of brands 3. Diversified product range Weaknesses 1. Slow sales growth compared with the competitors. 2. Low cash flow, high operation cost Opportunities 1. Move operations to developing countries; 2. High market share 3. Increasing need for healthy products Threats 1. Strong competitors; 2. Increasing store brand; 3. Company‟s image destroyed
  7. 7. SWOT Analysis Strengths 1. Operates around many countries 2. Strong portfolio of brands 3. Diversified product range Weaknesses 1. Slow sales growth compared with the competitors. 2. Low cash flow, high operation cost Opportunities 1. Move operations to developing countries; 2. High market share 3. Increasing need for healthy products Threats 1. Strong competitors; 2. Increasing store brand; 3. Company‟s image destroyed
  8. 8. Five Forces Analysis Existing competitive rivalry between suppliers 1. Number and size of competitors 2. Strong distribution network required 3. customers are loyal to existing brands Threat of new market entrants 1. Large industry size 2. Economies of scale 3. brand strength Bargaining power of buyers 1. Large number of buyers 2. Increasing amount of price-sensitive consumers 3. loyalty to the specific retailer Bargaining power of suppliers 1. Large number of substitute inputs 2.High competition among suppliers; 3.Own brand product Threat of substitute products 1. Low alternatives price 2. high alternatives quality 3. low nature of switching costs. Low Low Low High High
  9. 9. Internal Analysis
  10. 10. Resource Audit Resource Competence Threshold capability Threshold Resources Tangible: Human resource(174,000) Intangible: Technical knowledge(innovation) Threshold Competences Customer Care Products& brands variety Capability for competitive advantage Unique Resources Joint Venture (Pepsi Co) R&D locations Core Competences Brand strategies IT infrastructure Management(HP)
  11. 11. Stakeholder Analysis
  12. 12. Corporate-Level Strategy Analysis One
  13. 13. “We add vitality to life” Corporate Vision: • We work to create a better future every day. • We help people feel good look good and get more out of life with brands and services that are good for them and good for others.
  14. 14. Product Diversification • Strategy 1: Brand Power •Strategy 2: Innovation •Strategy 3: The Best Talent •Strategy 4: Sustainable Living Source: Unilever compass strategy 2014
  15. 15. BCG Matrix Household care(6.2%) (Surf Excel,Cif) Refreshment(1.8%) (Supreme Tea)Food(2%) (Wall's) MarketGrowth Market ShareHigh Low High 10% -10% 0 personal Care(10%) (Dove) Low CBG Matrix(2012)
  16. 16. Corporate-Level Strategy Analysis Three
  17. 17. M&A Unilever emerged from a merger. Trend:  From 1937 – 1978 Unilever made numerous acquisitions under the strategy: Rigorous Growth (Fwd. & Back integration and related & unrelated diversifications)  From 1980-1995, the management of smaller brands slowed growth -> Unilever seemed too large, too diverse and experienced integration difficulties – Synergy unachievable. Hence = divest, focused growth  From 1995- Shrink to grow, focus on company‟s core competences  Strategy: Sustainability through restructuring  From centrally-driven expansion to branched expansion
  18. 18. Resource: Riley,J (2010)
  19. 19. Corporate Strategy: Path to Growth (2000-2004) Downsized from 1600-400 brands, make room for high profile brands like Ben & Jerry, Sara-Lee and Alberto Culver Shifted from: “Merge as a path to Growth” to “Shrinking to Grow” Laid off 10% employees, 100 manufacturing units for cost reduction “Nourishing the core” – Restructuring Focus on Key Brands  Brand management & advertising Advantages of this strategy:  Sales shot up by 16%  Unilever‟s share price recovered 30%  Top line growth 4%-5% achieved
  20. 20. Corporate Strategy: Growth to vitality 2004-2010  Focus on 40 Mega world brands > billion $  Focus on developed and emerging markets  Concept of “One Unilever” to boost Focused Growth, divestment and acquisitions were employed The good news is… Unilever‟s acquisition has:  Increased market power, Optimization - supply chain, economies of scale, reduced risk & cost to new products and their speed to market.  Reshaped the firms comp. scope = reduces dependence on specific markets
  21. 21. Risks associated with M&A:  Too large (too diverse) + decentralised structure= slow growth  Inability to achieve synergy • When synergies do not generate real cash flows  Workers lay offs • Employee rights • Effects on employee morale • Loss of human capital + lower performance Restructuring strategies: 1. Downsizing 2. Down scoping: divest ( 210 disposals) for non core business “Leads to greater focus” 3. Unilever complementary acquisitions create value and revenue schemes 4. Gives Unilever strategic positioning in markets it competes in
  22. 22. Corporate-Level Strategy Analysis Four
  23. 23. CSR Unilever in the Victorian England era •Motives : Strategic leadership Unilever during world war I, II post war activities •Motives: market forces. The Lady Lever Art gallery  USLP • Responsible investment • Stakeholder theory: focused from mass employees to mass consumers.. • Utilizes a powerful integrated business strategy – not a hold on (selective/invisible approach) Product & brands + Brand strategies •The power of brands and that brands do drive behavioural change for the better
  24. 24. Unilever Sustainability Living Plan (USLP) 2010-2020 Has three main goals  Improve hygiene & nutrition (People)  Halve greenhouse gases impact (Environment)  Source 100 percent of a product‟s raw materials sustainably. (Profit) How sustainability works for Unilever? Links Financial success and sustainability • Cost reduction along the supply chain “environmental case”  Sustainable brands grow market share and profits • sustainability and revenues is achieved by offering healthier and more sustainable brands • engaging current and prospective customers through awareness outreach campaigns
  25. 25. USLP …  „Glocal‟ Marketing strategy and social projects e.g. Project sunlight, “love your heart” and “Brush Day and Night” oral health campaign The changing Social contract:  Using BRANDS and strong roots in the local market (D&E) and first hand knowledge of the local & regional culture  Competitive Rivalry => Brand Royalty The triple bottom line: People: USLP activities reached 303 million people 2013 Profit :marketing increases sales+ cut cost throughout supply chain + Profit margin Planet: GHG emission man. dropped by 32% as at 2013
  26. 26. Conclusion and Recommendations
  27. 27. Conclusion • Unilever offers value in terms of price and quality • Initiating projects to improve and manage the environmental impacts • Huge transformation in terms of geographical and product portfolio • Decreasing turnover in western Europe: from 65% to 34% overall sales
  28. 28. Recommendations Although Unilever is already on the brink of its success but there is always room for improvement. • Being a global company it needs to operate according to local preferences • Needs to make its brand name stronger in order to make sure they don‟t go unnoticed • Improving the quality instead of increasing the price- adds value • Better strategy to maintain its level over the local competitors
  29. 29. References Angwin, D., Cummings, S. and Smith, C. (2007) The Strategy Pathfinder: Core Concepts and Micro-cases, Oxford : Blackwell Publishing. Library classification to be advised. Cashian, P. (2007) Economics, Strategy and the Firm, Hampshire: Palgrave Macmillan. Johnson, G., Scholes, K., and Whittington R., (2008) Exploring Corporate Strategy, 8th Edn., Financial Times/Prentice Hall, Harlow . Library classification 658.401 JOH. Lynch, R. (2006) Corporate Strategy, 4th Edition,Harlow: Financial Times Prentice Hall. Library Classification 658.4012 LYN. Stacey, R (2007) Strategic Management and Organisational Dynamics: The Challenge of Complexity, 5th edition, Harlow : Financial Times/Prentice Hall, Library Classification 658.4012 STA DeWit, B & Meyer, R (2004) Strategy, Process, Context and Content: An International Perspective, 3rd edition, Thomson International Business, Library Classification Reader, W. J. (1980) Fifty years of Unilever, 1930-1980 London:Heinemann Unilever annual report (2012) [online] available from <http://www.unilever.com/images/ir_Unilever_AR12_tcm13-348376.pdf > [27 Feb 2014] Figures &business facts (2014) [online] available from <http://www.unilever.com/aboutus/introductiontounilever/unileverataglance/index.aspx> [27 Feb 2014] Unilever mission (2014) [online] available from <http://www.unilever.com/aboutus/introductiontounilever/ourmission/> [27 Feb 2014] Supply management (2013) Unilever named best supply chain in Europe [online] available from <http://www.supplymanagement.com/news/2013/unilever-named-best-supply-chain-in-europe> [27 Feb 2014] Value Chain picture [online] available from <http://www.smartersolutions.com/blog/forrestbreyfogle/wp-content/uploads/2010/07/Michael-Porters-Value-Chain- Cc984967_BusDrivenEvalofDistComp02en-usMSDN_10.jpg > [27 Feb 2014]
  30. 30. References Unilever HR management (2013) [online] available from <http://www.unilever.co.uk/Images/6550_Unilever_MBY_6pp_HR_tcm28-365478.pdf > [28 Feb 2014] Unilever innovation (2014) [online] available from <http://www.unilever.co.uk/innovation/> [28 Feb 2014] Unilever procurement (2014) [online] available from <http://www.unilever.com/aboutus/supplier/unileverprocurement/> [28 Feb 2014] Distribution &transport (2014) [online] available from <http://www.unilever.com/sustainable-living/greenhousegases/transport/> [28 Feb 2014] Unilever & PepsiCo to expand ready-to-drink tea joint venture (2007) [online] available from <http://www.unilever.com/mediacentre/pressreleases/2007/UnileverPepsicotoexpand.aspx> [27 Feb 2014] Stakeholder analysis map http://leadershiplearning.org/blog/zoe-madden-wood/2013-01-29/project-management-starting-your-project-change The World Bank. (2007) „Tools for institutional political, and social analysis of policy reform‟. Journal of writing studies [online], 125-126. Available from <http://books.google.com.hk/books?id=gZWncS4cd4gC&pg=PA126&dq=stakeholder+analysis&hl=zh- CN&sa=X&ei=vKsQU9ilCcmshQfoz4GgDQ&ved=0CEYQ6AEwAw#v=onepage&q=stakeholder%20analysis&f=true > [28 Feb 2014] Our suppliers (2014) [online] available from<http://www.unilever.com/aboutus/supplier/> [28 Feb 2014]
  31. 31. Thank You Any Questions

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