Unilever plans to reorganize around emerging markets

By Guy Montague-Jones

- Last updated on GMT

Unilever plans to combine its Home & Personal Care and Food
divisions and reorganize its geographical management to make it
leaner and more focused on emerging markets.

Close rival Proctor & Gamble has outperformed Unilever in recent years and in 2005 P&G overtook it as the world's largest consumer goods company when it acquired Gillette. Improving profitability ​ Since then Unilever has worked hard to improve its profitability by slimming down and focusing on its core businesses. The owner of major cosmetics brands like Dove, Lux and Vaseline, announced plans in July to cut twenty thousand jobs in order to cut costs by €1.5bn and lift its operating margins to above 15 per cent by 2010. With improved productivity again in mind Unilever has now decided to combine Home & Personal Care and Foods into a single category structure. Ralph Kugler will step down as the AGM in May as president of Home & Personal Care, and Vindi Banga, currently president of Foods will take over as the head of the new division. Focus on emerging markets ​ The company also announced measures designed to accelerate its top line growth, which was up 1.7 per cent to €9.89bn for the fourth quarter in 2007. In particular the Anglo-Dutch firm intends to reorganize itself in a manner that reflects its strategic focus on growth in developing markets. Under the new plan Central & Eastern Europe will be managed within an enlarged high growth region comprising of Asia, Africa and Central & Eastern Europe. Bringing the emerging markets under one management umbrella will enable the company to benefit from the fact that the different countries share similar market developments and have comparable potential for growth. Management reshuffle rewards success ​ Higher profile roles will be enjoyed by managers of top performing businesses in emerging markets in order to inject their knowledge, talent and success into the heart of the company. Doug Baillie will join the Unilever Executive as president of Western Europe, which is now a standalone region, having previously been CEO of Hindustan Unilever. Harish Manwani, currently president of Asia Africa, will lead the new expanded region of Asia, Africa and Central & Eastern Europe. Patrick Cescau, Group Chief Executive said: "These measures build naturally on the changes of recent years and give us an organizational structure even better placed to advance our growth agenda."

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