P&G in Major Revamp of Management Structure

15 May 2007

CINCINNATI: Planet Earth's largest advertiser on Monday announced far-reaching changes to its management structure, splitting the Procter & Gamble business into three new global units and further assimilating Gillette into its maw.

Effective July 1, the Cincinnati colossus will morph into three distinct worldwide units, all under the baton of Susan E Arnold, 53, (pictured above), newly promoted to president, global business units and responsible for development and innovation of . . .

  • Beauty Care
  • Health and Wellbeing
  • Household Care.
Gillette, acquired in 2005, will cease to operate as a discrete business unit. Its Duracell battery division will melded with the Household Care unit, and its shaving brands integrated into Beauty Care.

The sweeping restructure is the culmination of six years of massive growth by acquisition, in which P&G acquired not only Gillette but also the Clairol and Wella haircare businesses.

In an associated move, Robert A McDonald (53), currently vice-chairman of global operations, becomes worldwide chief operating officer with special responsibility for business development.

Inevitably there are casualties and several unnamed unit presidents and other corporate officers will leave, according to a P&G statement.

Chairman/ceo A G Lafley claims the changes are intended to meet the needs of a larger business that is developing new initiatives faster than in the past.

As ever, Wall Street is reading the corporate runes. According to one haruspex, Amy Low Chasen at Goldman Sachs: "We believe this news formalizes a potential near-term succession plan with Arnold and McDonald as the primary successors [to Lafley].

Her ear attuned to executive washroom talk at P&G, Low Chasen also opines that Lafley, who is sixty, "has no intention to retire" yet awhile.

Data sourced from New York Times; additional content by WARC staff