Procter & Gamble Restructures, Splits up Gillette
Procter & Gamble announced an overhaul of its business structure, dividing it into three new global units and breaking up the Gillette business it acquired in 2005.
As part of the restructuring, the company said it would promote Susan Arnold to president, global business units, and Robert McDonald to chief operating officer. Both executives are now on the same rung of the corporate ladder as Chief Financial Officer Clayton Daley, a level below Chairman and Chief Executive A.G. Lafley.
P&G has nearly doubled its business since 2000 with the acquisitions of the Clairol and Wella hair care businesses and Gillette. The change in structure for the company is designed to meet the needs of a larger business that is also developing new initiatives faster than in the past, Lafley said in a news release.
As part of the restructuring, Gillette will no longer operate as a global business unit. Its Duracell battery operation will shift to the global household care unit, while the shaving part of the business will come under beauty care.
Also as part of the structuring, several unit presidents and other corporate officers will leave the company, P&G said.
The changes will take effect July 1.
Bruce Byrnes, vice chairman of the board, has already said he plans to retire in 2008.
Arnold, 53, will be in charge of the company's three worldwide business units: beauty care, global health & well being and household care. In that job, she will be responsible development and innovation in the company's brands, which also include Tide laundry detergent and the Olay skin care line. She is currently vice chairman for P&G beauty and health products.
McDonald, 53, is vice chairman for global operations. As chief operating officer, he will be in charge of the company's global operations, including the units that develop P&G's businesses in local markets.
The stock of Procter & Gamble, a Dow Jones Industrial Average component, is down 4% this year, while the Blue chip index is up 7%.