The Organizational Structure of Pg

Topics: Procter & Gamble, Organizational structure, Change management Pages: 9 (2761 words) Published: May 13, 2013
The organizational structure of Proctor and Gamble

Procter & Gamble
The company I have chosen for the assignment of managing change in organization is Procter & Gamble. The company is a Fortune 500 American multinational corporation headquartered in Downtown Cincinnati, Ohio that manufactures a wide range of consumer goods. It is 6th in Fortune's Most Admired Companies 2010 list. P&G is credited with many business innovations including brand management and the soap opera. History and Background of Company

In 1887 P&G institutes a pioneering profit-sharing program that gives employees an ownership stake in the Company. This significant innovation helps employees connect their vital roles with the Company’s success. In 1924 P&G becomes the first company to conduct deliberate, data-based market research with consumers. This forward-thinking approach enables us to improve consumer understanding, anticipate consumer needs and respond with products that improve their everyday life. In 1994 P&G becomes one of the first companies to formally respond to consumer correspondence by establishing the Consumer Relations department. The addition of toll-free phone numbers in 1973 and e-mail in the 1980s further enhance consumers’ ability to contact us and keep the consumer at the heart of all we do. In 1995 Crest is co developed with Indiana University. This collaboration delivers a product that is a breakthrough in the use of fluoride to protect against tooth decay, the second-most prevalent disease at the time. In 2002 P&G develops Naturella feminine pads specifically to meet the needs of low-income women in Latin America. Based on deep consumer understanding, Naturella responds to consumers’ desire for freshness with chamomile, a unique ingredient never before used in feminine care products. In 2005 High Frequency Stores common in developing markets emerge as our largest customer channel. Consisting of nearly 20 million stores across the world, HFS represents a particular opportunity in fast-growing, low-income markets. Through HFS, we connect to consumers with affordable products and packaging specially designed for their needs. Investigation Organizational Structure of Procter & Gamble General definition of Organization structure:

Organizational structure specifies the firm’s formal reporting relationships, procedures, controls, and authority and decision-making processes. Developing an organizational structure that effectively supports the firm’s strategy is difficult, especially because of the uncertainty (or unpredictable variation) about cause-effect relationships in the global economy’s rapidly changing and dynamic competitive environments. When a structure’s elements (e.g., reporting relationships, procedures, and so forth) are properly aligned with one another, that structure facilitates effective implementation of the firm’s strategies. Thus, organizational structure is a critical component of effective strategy implementation processes Types of organizational structure

Simple Structure
The simple structure is a structure in which the owner-manager makes all major decisions and monitors all activities while the staff serves as an extension of the manager’s supervisory authority. Functional Structure

The functional structure is a structure consisting of a chief executive officer and a limited corporate staff, with functional line managers in dominant organizational areas, such as production, accounting, marketing, R&D, engineering, and human resources. Multidivisional structure

The multidivisional (M-form) structure consists of operating divisions, each representing a separate business or profit center in which the top corporate officer delegates responsibilities for day-to-day operations and business-unit strategy to division managers. Procter & Gamble

The structure of the Procter and Gamble is multidivisional structure. Because the simple structure is used in a small...
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