Procter & Gamble’s new Chairman and
CEO AG Lafley has stated that the company will focus on four main
pillars to significantly improve the multinationals performance in the
2014 fiscal year.
Mr.
Lafley said that value creation, productivity, operation discipline and
strategic investments will be the company’s focus areas as it builds on
its fourth
quarter results.
“We
will establish value creation for consumers and shareholders as our
clear priority. This starts with winning the value equation with the
consumer…who is
always the boss. We have to win at the first moment of truth – when the
consumer chooses our product at the store shelf – and the second moment
of truth – when the consumer uses the product at home and decides
whether to buy it again. Winning with consumers
is a foundation of value creation,” said Lafley.
He
added that P&G will seek to strengthen and accelerate its
productivity and costs savings efforts as innovation and productivity
remain the two biggest drivers
of value creation.
“Innovation
and productivity are the two biggest drivers of value creation.
Innovation remains our primary driver of growth, and we have a full
innovation pipeline.
Productivity makes us more effective and efficient, particularly in a
slower growth world with more volatility, and frees us to make bigger
contributions. Productivity improves gross and operating margins and
provides more opportunities to invest in growth.
Productivity will become one of our core strengths – alongside consumer
understanding, brand building, innovation, go-to-market capabilities,
and scale – to deliver value creation and growth,” said Mr. Lafley.
Lafley added that the company will strive to improve its operating discipline so as to win with consumers and customers.
With
the company spending $ 2 billion annually on research and development,
Lafley noted that the company has reallocated some of its savings to
make strategic,
focused investments in innovation and go-to-market capabilities which
are two important sources of P&G’s competitive advantage.
Last
week, P&G announced its fourth quarter results which saw the
company reported fiscal year 2013 diluted net earnings per share from
continuing operations
of $3.86, up 24 percent versus the prior year. Its core earnings per
share were $4.05, an increase of five percent versus the prior year. Net
sales were $84.2 billion, an increase of one percent including a
negative two point impact from foreign exchange.
Organic sales grew three percent for the fiscal year.
Lafley
previously served as P&G’s President and CEO from 2000 to 2009.
During this time, the Company recorded more than doubled sales and grew
its portfolio of billion-dollar
brands from 10 to 23 with a focus on consumer-driven innovation and
consistent, reliable, sustainable growth. The Company’s market
capitalization has made P&G among the 10 most valuable companies in
the world.
