P&G Ponders Future Without Lafley As More Details Emerge From $500 Million Manufacturing Facility In Berkeley County
P&G CEO prepares to end his second term by the end of the fiscal year in June, Berkeley Economic Development Authority’s board on Thursday learned additional details about the size of Procter & Gamble’s investment.
Procter and Gamble Inc. (PG) has announced that A.G Lafley, who was appointed second time as CEO of the world’s largest foods and consumer goods, will be ending his term this summer, most probably by around the end of fiscal year in June. Top executives of P&G have been hinting for weeks about the imminent search for a new CEO, making it clear that there is no chance for Mr. Lafley to hang around.
David Taylor, appointed in February to look after P&G’s two important divisions, looks as the most likely replacement. However, Mr. Lafley will remain as a chairperson for the year in order to guide the new leadership to stay on courses during the transition period, which will likely witness many ‘speedbumps’ along the way.
Currently, the company is entangled in cost cutting measures, by trimming around 100 P&G products and brands, rationalizing staffs by terminating less than 3000 staffs by June, whilst its competitor is galloping ahead by raking in revenues from emerging economies and taking advantage of the weaker euro that helps in bringing in more revenue from foreign exchange earned abroad. P&G’s cost cutting is only expected to strangle it further.
Ironically, Mr. Lafley’s predecessor, Bob McDonald, who became CEO in 2009, first undertook this strategy but left after 2013, in response to greater investor discontent about it, as they felt is giving space to its competitors to fill in the gap in the market that P&G has failed to provide. The retiring CEO was credited in boosting revenues by launching new brands, improving results for long-held brands, and acquiring the Gillette Co. in 2005. Since his return, he had to, more or less, follow McDonald’s methods, as economic conditions from 2000–2009 were different. Analysts have been speculating about his resignation since late last year.
In news, the state Economic Development Authority’s board has learned additional details about the company’s $500 million manufacturing facility in Berkeley County. In February, the world’s largest family care and consumer goods submitted a plan for establishing the facility by 2017 and initially employing 700 workers. Now, new details provided by the company indicate that it will employ over a thousand workers and will cover an estimated area of 4,325,540 square feet. It was originally announced that the building would be just 1 million square feet. Plant construction is expected to begin around ‘fall’, after being pushed back from spring due to the release of new design details.