CASE ANALYSIS.

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Presentation transcript:

CASE ANALYSIS BY : TEAM 6

Procter & Gamble vs. Unilever – A case of Corporate Espionage

INTRODUCTION Procter & Gamble vs. Unilever , a case of corporate espionage . It details the covert operation conducted by P & G to gain competitive information about Unilever’s shampoo business in US. P & G appointed agents who misrepresented themselves as market analysts to collect information about Unilever’s haircare business.

Company Profiles

Procter & Gamble P&G is US based , no:1 maker & marketer of household products established by William Procter & James Gamble , who merged their small businesses. ACQUISITIONS Spic & Span, Duncan Hines, Clorox & Folgers Coffee MAJOR BRANDS Tide, Pampers, Pantene, Vicks , Head & Shoulders, Actenol, Clairol Herbal Essences etc ACHIEVEMENTS Largest cosmetic company(1940) Ranked 31st among the Fortune 500 companies(2003)

Unilever Formed in 1930 by merging Dutch Margarine Company, Margarine Unie & Lever Brothers. ACQUISITIONS Thomas J.Lipton , Pepsodent MAJOR BRANDS Nestle, Knorr, Lipton, Dove, Calvin Klien, Surf, Axe, Lux, Close Up, Vaseline, Bird’s Eye, Cornetto. ACHIEVEMENTS 2nd largest packaged consumer goods company 3rd largest food firm in the world

P&G Vs UNILEVER It is a case of Corporate Espionage. It details the covert operation conducted by P&G to gain competitive information about Unilever’s shampoo business in the US. Here in order to collect information about Unilever’s haircare business P & G appointed agents who allegedly misrepresented themselves as market analysts.

Aftermath….. P&G admitted about the information collection episode, but without the knowledge of top mgt. Refuted Fortune Magazine’s claim that P&G’s agents misrepresented themselves. Also claimed that it had not indulged in any illegal activities & these were against its strict business policies. Tried for negotiation but failed… & Unilever initiated legal proceedings.

Many analysts felt that what P&G did was right as it occurred in the intensely competitive hair care business in US. However some analysts argued that P&G had made a mistake by voluntarily disclosing its transgression to UNILEVER.

Competitive intelligence A technique of applying industry/research expertise to analyse the information available on competition from public sources & draw conclusions based on this data. Agent follow a set of legal & ethical guidelines formulated by the society of competitive intelligence professionals.

A technique of applying industry/research expertise to analyse the information available on competition from public sources & draw conclusions based on this data. Agent follow a set of legal & ethical guidelines formulated by the society of competitive intelligence professionals Companies should be aware of competitor strategies & efforts to effectively counter the strategies & sustain in the market

Corporate Espionage It can be defined as spying on business competitors for acquiring proprietory information such as marketing plans , trade secrets, products designs, research objects, source code for new software, intellectual property, research info. & other business strtegies . Agents do not abide by any legal or ethical guidelines , & do anything to get competitive information. It includes dumpster diving, social engineering, interviewing disgruntled employees, bugging offices & hacking computer systems.

P & G and UNILEVER issue was considered as one of the most high-profile incidents of corporate espionage ever reported. Though the goals of Competitive Intelligence & Corporate Espionage are similar , the methods adopted for both is different. ie. CI is an ethical & legal method for collecting information but Corporate Espionage is unethical & illegal method.

Conclusion….. Corporate Espionage is not a healthy practice and what P&G did is illegal & unethical. To avoid such instances certain steps are to be followed: Update security measures Proper training for employees to prevent them from divulging sensitive info. Law ,more stringent increasing the level of punishment

Companies should commit themselves against indulging in illegal & unethical practices. They should formulate an internal code of ethics & ensure that they are abided by the employees & remain within the domain of of true CI. It should not be maligned by Corporate Espionage, when it is done in the right way. CI allows companies to compete fiercely & fairly.

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