P&g Case Study

(A): YES ...

- Because it increases efficiency through greater cross border integration

- Standardizing manufacturing process

- Simplifying brands portfolios

- Coordinating marketing activities

- Reduce bureaucracy

- Increase decision making authority for middle management

- Ease the process of decision making (digitizing decision process)

(B):

Organization 2005 shifts the company from a structure based primarily open geographical region to one-based open global product division; each division is a global business unit. Organization 2005 didn't cut cost, didn't deliver sales growth, or improved margins. However, we assume in the long run the company through global business unit (GBU) will be able to cut its cost.

Some changes need to be taken under consideration the Organization 2005 structure. Some product such as cosmetics and most foods cannot be globally branded or standardized. P&G noted that the implementation of organization 2005 will result in loss of market share especially in merging markets such as Eastern Europe, South East Asia, and China. Thus; some products or brands can be marketed only in specific geographical bases.

From our point of view, organization 2005 will increase P&G overall efficiency and innovation but to eliminate market share loses the plan should consider that some product cannot be branded globally due to different consumers preferences in different markets either developed or non-developed countries. In order to satisfy different consumers in different markets, P&G should enhancing the companies IT capabilities in each global business unit (GBU); thus, the company will be able to avoid most duplicated activities and enhance communication across the organization vertically and horizontally which generally will result in increasing efficiency and eliminating bureaucracy. Moreover, strong IT capabilities will enhance the decision-making process to be able response rapidly to global changes in a coordinated way. Finally, through pooling research activities around the technologies relevant to different product categories will maximize innovation.