Proctor and Gamble 2008 Annual Report Download - page 6

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OnJune4,2008,weannouncedouragreementtomergeP&G’s
coffeebusinesswithTheJ.M.SmuckerCompany.Theagreement
maximizestheafter-taxvalueofthecoffeebusinessforP&G
shareholdersandminimizesearnings-per-sharedilutionversus
otheralternatives.Weexpecttocompletethetransactionduring
thesecondquarterofscal2009.

Thisisstrongperformance,butthechallengeofsustaining
growthisgreatertodaythanatanytimeinthepast50years.
Commodityandenergycostscontinuetoriseforcompanies.
Consumersarefacinghigherfoodandgasprices,declining
homevalues,andrisinglevelsofunemployment.Thequestion
shareholdersandprospectiveinvestorsareaskingis:”Howwill
P&Gsustaingrowthintoday’schallenginganduncertain
economicenvironment?”
&
Innovationisat
theheartofP&G’sbusinessmodel.Itistheprimarywaywe
delightconsumers,createvaluewithretailpartners,andcreate
newbusinessmodelstodeliverconsistent,sustainablegrowthat
oraheadoftheCompany’sgoals.
Alotofcompaniestalkaboutinnovation,butP&Ghas
demonstratedthecapability—overdecades—toinnovate
consistently,reliablyandsuccessfully.Wehavealonglistof
innovationrstsinourindustry:
Tidewastherstheavy-dutylaundrydetergent
•
Crest,therstuoridetoothpasteclinicallyproventoprevent•
toothdecay
Downy,therstultra-concentratedrinse-addfabricsoftener
•
PertPlus,therst2-in-1shampooandconditioner•
Head• &Shoulders,therstpleasant-to-useshampooeffective
againstdandruff
Pampers,therstaffordable,mass-marketeddisposablediaper
•
Bounty,therstthree-dimensionalpapertowel•
Always,therstfeminineprotectionpadwithaninnovative,•
dry-weavetopsheet.
Febreze,therstfabricandaircareproductsthatactually
•
removeodorsfromfabricsandtheair
CrestWhiteStrips,therstpatentedin-hometeethwhitening
•
technology
P&Gcontinuestobeoneofthefewcompaniesinourindustry
thatcreatesnewcategoriesandbrands,newperformance
standards,andnewdenitionsofconsumervalue.Swifferand
Febrezecreatedentirelynewproductcategories.CrestPro-Health,
OlayRegeneristandDenity,PampersBabyStagesof
Development,andTidewithBleachredenedhighperformance
intheircategories.Olayinnovationhascreatednewconsumer
experiencesthatareasgoodas—orbetterthan—several-
hundred-dollardepartmentandspecialtystorebrands.
Weinnovatesoconsistentlyacrossourdiverseportfolioof
businesses,andsoconsistentlyovertime,becausewe’ve
createdauniquedesignforinnovationatP&G.
1.Webroadly.
2.Weatindustry-leadinglevels.
3.Wewithdiscipline.
4.Wethatbuildsconsumertrust
andloyaltyovertime.
5.Wewithglobalbrandsandan
outstandingteamofinnovationleaders.
Thisintegrated,end-to-endapproachiscomplementedby
P&G’sglobalscaleandscope,whichisunrivaledinourindustry.
TheresultisaninnovationdesignthatenablesP&Gtowinwith
consumersandretailcustomersandtogeneratesustainable
long-termgrowthandshareholdervalue.

Wedeneinnovationbroadly.Weinnovateineveryareawhere
ourbrandstouchconsumers’lives:thepackageandproduct,
theshoppingexperience,thein-homeproductusageexperience,
andeveryaspectofcommunication.Wealsocreateinnovative
newbusinessmodelsandorganizationalstructures.Byinnovating
sobroadly,wegettoseemoreinnovationopportunitiesandto
leveragemoreinnovationresourcesthanmorenarrowlyfocused
competitors.
OurFamilyCarebusinessisagoodexample.Twentyyearsago,
wecreatedaproprietarypaper-makingprocessthatenablesusto
producethestrongest,softest,mostabsorbentpapertowelsand
tissuesonthemarket.ButourapproachtoinnovationinTissues
andTowelsisdrivenbyconsumers,notbythetechnology.
4 TheProcter&GambleCompany