Proctor and Gamble 2002 Annual Report Download - page 6

Success Drivers
There are six drivers of P&G’s success: consumer focus, strategic choices, operational
excellence, financial discipline, organizational structure and brand building capability.
Consumer focus. The consumer is boss and we put the consumer at the heart of all we do.
First and foremost, this means getting the consumer value equation right on all our brands.
It also means delivering superior, consumer-meaningful innovation. Competitive pressures
make this a continuing challenge, but we are working hard in every part of our business to
deliver a continual stream of innovation that meets consumer needs in ways that reset
performance expectations and represent superior value.
We are also making sure that P&G business leaders – including me – get out of the office
and into stores and homes to talk directly with people who buy and use our products. No
other real-world experience clarifies the choices we must make as much as these
conversations with consumers.
Strategic choices. We’ve focused on P&G’s core categories, leading brands, and the biggest
retail customers and country markets. And, we’re investing in faster-growing, higher-margin,
more asset-efficient businesses. A good example is the acquisition of Clairol, which
complements the core Hair Care business and helps P&G enter the fast-growing hair colorant
category. Strategic choices like these are paying off. For example, about one-fourth of total
gross margin improvement in fiscal 2002 came from our emphasis on faster-growing, higher-
margin businesses such as Beauty Care and Health Care.
Operational excellence. Execution determines success, and we’ve placed heightened
emphasis on operational excellence at P&G. Again, Clairol is a good example. We closed this
deal in less than six months and fully integrated business operations seven months later.
Most important, we accomplished a smooth integration and we’re on track to deliver the
committed synergy savings ahead of schedule.
Financial discipline. We have reinforced P&G’s long-standing commitment to financial
discipline. Our efforts are seen most clearly in the Company’s business results. Even before
the highly publicized accounting failures at several companies, we took a number of specific
Iams in North America is another great
example of operational excellence.
Starting with a 25,000 store, 3,000
truck launch – P&G’s largest ever –
Iams has delivered nine consecutive
quarters of market share growth.
Recent P&G innovations include
Pampers Baby Stages of Development
diapers, Crest SpinBrush and White
Strips, Olay Daily Facials and Total
Effects, Tampax Pearl, Tide and Downy
Clean Breeze, Swiffer and many others.
4
Success Drivers
There are six drivers of P&G’s success: consumer focus, strategic choices, operational
excellence, financial discipline, organizational structure and brand-building capability.
Consumer focus. The consumer is boss and we put the consumer at the heart of all we do.
First and foremost, this means getting the consumer value equation right on all our brands.
It also means delivering superior, consumer-meaningful innovation. Competitive pressures
make this a continuing challenge, but we are working hard in every part of our business to
deliver a continual stream of innovation that meets consumer needs in ways that reset
performance expectations and represent superior value.
We are also making sure that P&G business leaders – including me – get out of the office
and into stores and homes to talk directly with people who buy and use our products. No
other real-world experience clarifies the choices we must make as much as these
conversations with consumers.
Strategic choices. We’ve focused on P&G’s core categories, leading brands, and the biggest
retail customers and country markets. And, we’re investing in faster-growing, higher-margin,
more asset-efficient businesses. A good example is the acquisition of Clairol, which
complements the core Hair Care business and helps P&G enter the fast-growing hair colorant
category. Strategic choices like these are paying off. For example, about one-fourth of total
gross margin improvement in fiscal 2002 came from our emphasis on faster-growing, higher-
margin businesses such as Beauty Care and Health Care.
Operational excellence. Execution determines success, and we’ve placed heightened
emphasis on operational excellence at P&G. Again, Clairol is a good example. We closed this
deal in less than six months and fully integrated business operations seven months later.
Most important, we accomplished a smooth integration and we’re on track to deliver the
committed synergy savings ahead of schedule.
Financial discipline. We have reinforced P&G’s long-standing commitment to financial
discipline. Our efforts are seen most clearly in the Company’s business results. Even before
the highly publicized accounting failures at several companies, we took a number of specific
Iams in North America is another great
example of operational excellence.
Starting with a 25,000 store, 3,000
truck launch – P&G’s largest ever –
Iams has delivered nine consecutive
quarters of market share growth.
Recent P&G innovations include Pampers
Baby Stages of Development diapers,
Crest SpinBrush and Whitestrips,
Olay Daily Facials and Total Effects,
Tampax Pearl, Tide and Downy Clean
Breeze, Swiffer and many others.
4