Proctor and Gamble 2011 Annual Report Download - page 37

Management’s Discussion and AnalysisThe Procter & Gamble Company 35
Baby Care and Family Care: In baby care, we compete mainly in
diapers and baby wipes, with approximately 35% of the global market
share. We are the number one or number two baby care competitor
in most of the key markets in which we compete, primarily behind
Pampers, the Company’s largest brand, with annual net sales of
approximately $9billion. Our family care business is predominantly
aNorth American business comprised largely of the Bounty paper
towel and Charmin toilet paper brands. U.S. market shares are
approximately 45% for Bounty and over 25% for Charmin.
GLOBAL OPERATIONS
Global Operations is comprised of our Market Development
Organization (MDO), which is responsible for developing go-to-market
plans at the local level. The MDO includes dedicated retail customer,
trade channel and country-specific teams. It is organized along five
geographic units: North America, Western Europe, Central& Eastern
Europe/Middle East/Africa (CEEMEA), Latin America and Asia, which
is comprised of Japan, Greater China and ASEAN/Australia/India/
Korea (AAIK). Throughout MD&A, we reference business results in
developing markets, which we define as the aggregate of CEEMEA,
Latin America, AAIK and Greater China, and developed markets,
which are comprised of North America, Western Europe and Japan.
GLOBAL BUSINESS SERVICES
GBS provides technology,processes and standard data tools to enable
the GBUs and the MDO to better understand the business and better
serve consumers and customers. The GBS organization is responsible
for providing world-class solutions at a low cost and with minimal
capital investment.
CORPORATE FUNCTIONS
CF provides Company-level strategy and portfolio analysis, corporate
accounting, treasury, external relations, governance, human resources
and legal, as well as other centralized functional support.
Strategic Focus
We are focused on strategies that we believe are right for the long-
term health of the Company and will deliver total shareholder return
in the top one-third of our peer group. The Company’s long-term
financial targets are:
ō Grow organic sales 1% to 2% faster than market growth in the
categories and geographies in which we compete,
ō Deliver Core EPS growth of high single digits to low double digits, and
ō Generate free cash flow productivity of 90% or greater.
In order to achieve these targets, we have created one over-arching
strategy, inspired by our Purpose. At the heart of this strategy is
innovating to win by touching and improving the lives of:
ō More Consumers. We are improving more consumers’ lives by
innovating and expanding our product portfolio vertically, up and
down value tiers. We continue to successfully develop and launch
premium innovations focused on improving consumer value through
enhanced performance. We are also serving consumers who are
more price conscious through lower-priced offerings with superior
performance versus other mid-tier and value-tier alternatives.
ō In More Parts of the World. We are improving lives in more parts
of the world by innovating and expanding our existing product
portfolio geographically into new markets. We are increasing our
presence in developing markets and increasing the amount of sales
from these markets by focusing on affordability, accessibility and
awareness of our brands.
ō More Completely. We are improving lives more completely by
innovating to improve existing products, creating or entering
adjacent categories and expanding into new channels to reach
consumers where they shop. We are driving regimen use that
broadens the occasions for which our brands can serve the needs
of each consumer. By attracting new consumers into our existing
brand franchises and broadening the products used by our current
consumers, we are able to build scale, reduce costs and profitably
grow market share.
We will leverage P&G’s five core strengths that create competitive
advantages and are critical to winning in the consumer products
industry: consumer knowledge; innovation; brand-building; go-to-
market capabilities and scale. We are coordinating our activities across
categories and markets, acting more intentionally as one Company.
We are placing particular emphasis on execution, simplification and
scale as key improvement areas that will enable P&G to create the
greatest value and competitive advantage. Finally, we are strengthen-
ing the depth, breadth and quality of leadership at all levels of the
Company to make P&G a more demand-driven, real-time, future-
focused organization.