Reference no: EM133312668

Case 17-1 A Changing of the Guard at Unilever

Unilever, the global food and consumer packaged goods powerhouse, markets a brand portfolio that includes such well-known names as Axe, Ben & Jerry's, Dove, Hellmann's, Lipton, and Magnum. The company has approximately 167,000 employees and 2016 sales of €52.7 billion (about $60 billion); Unilever can trace its roots, in part, to the northern English town of Port Sunlight on the River Mersey. There, in 1888, Lever Brothers founder William Hesketh Lever created a garden village for the benefit of his employees.

Before retiring at the end of 2008, Unilever Group chief executive Patrick Cescau wanted to reconnect the company with its heritage of sustainability and concern for the environment. These and other values reflect Unilever's philosophy of "doing well by doing good." One example: the "Campaign for Real Beauty," which was launched by managers at the company's Dove brand. To prepare for their first presentation to management, Dove team members videotaped interviews with teen girls who talked about the pressures they felt to conform to a certain look and body type. The interviewees included Cescau's daughter as well as the daughters of Unilever's directors.

Later, when the CEO recalled watching the video, he explained, "It suddenly becomes personal. You realize your own children are impacted by the beauty industry, and how stressed they are by this image of unattainable beauty which is imposed on them every day." The Dove team was given the green light to launch a new advertising campaign based on this insight; in the years since, Dove has won numerous awards and accolades for the positive body image campaign.

Cescau's vision of "doing well by doing good" manifested itself in other ways, too. For example, he guided the company's detergent business toward using fewer chemicals and less water, plastic, and packaging. In addition, he recognized that today's "conscience consumers" look to a company's reputation when deciding which brands to purchase.

Paul Polman, Cescau's successor, built on another of the former chief executive's priorities: business opportunities in emerging markets such as India and China (see Exhibit 17-1). However, Polman also took the top job in the middle of the recent global recession. He is set to retire in 2019; to find out more about Unilever's commitment to global social responsibility and the challenges facing Polman's successor, turn to Case 17-1 at the end of the chapter.

This chapter focuses on the integration of each element of the marketing mix into a total plan that addresses opportunities and threats in the global marketing environment. Cescau's achievements as the head of Unilever illustrate some of the challenges facing business leaders in the twenty-first century: They must be able to articulate a coherent global vision and strategy that integrate global efficiency, local responsiveness, and leverage. The leader is also the architect of an organizational design that is appropriate for the company's strategy. For large global enterprises such as ASEA Brown Boveri (ABB), General Electric (GE), Koninklijke Philips, Tesco, Toyota, and Unilever, the leader must ensure that size and scale are assets that can be leveraged rather than encumbrances that slow response times and stifle innovation. Finally, the leader must ensure that the organization takes a proactive approach to corporate social responsibility.

Question 1: Are top executives of global companies likely to be home-country nationals?

Question 2: In a company involved in global marketing, which activities should be centralized at headquarters and which should be delegated to national or regional subsidiaries?

Question 3: "A matrix structure integrates four competencies on a worldwide scale." Explain.

Question 4: In the automobile industry, how does "lean production" differ from the traditional assembly-line approach?

Question 5: Identify some of the ways the global companies discussed in this text demonstrate their commitment to CSR.