Tuesday 21 August 2012

SWOT Analysis-HUL

SWOT - HUL

Strengths

 1. Strong and well differentiated brands with leading share positions
2. Distinctly placed products providing reach to every segment of society.
3. Consumer understanding and systems for building consumer insight
4. Integrated supply chain and well spread manufacturing units
5. Distribution structure with wide reach, high quality coverage – The launch of project “Shakti” has helped HUL to create brand awareness and extensive reach in rural India.
6. Access to Unilever global technology, capability and sharing of best practices from other Unilever companies.
7. Well placed to take advantage of growth in rural India and lower strata of the society through “Shakti”.
8. It could look at introducing products from its parent company like margarine in order to cater to changing consumer tastes and opportunities in food sector.
9. It can be a leader in exports by positioning itself as a sourcing hub for Unilever companies in various countries.
Weaknesses
1. Price positioning in some categories allows for low price competition like Amul captured Kwality’s market.
2. Limited success in changing eating habits of people.
3. Competitors focusing on a particular product and eating up HUL’s share, like Nirma focusing on soaps and detergents.

Opportunities
1. Growing consumer base due to increasing income levels and new consumers from lower strata of the society
2. Untapped market in branded Ayurvedic medicines and other such consumer products.
3. Opportunity in Food sector: changing consumer tastes
4. Expansion of horizons towards more and more countries

Threats
1. Unfavourable raw material prices due to inflation, reducing profitability.
2. Heavy onslaught of competition in the core categories from emerging players like ITC will result in higher advertising expenditure
3. Spurious/counterfeit products in rural areas and small towns.
4. Reduction in real income of consumers due to high inflation.

SWOT-Video

The Business Strategic-Planning Process




STRATEGIC PLANNING

Strategy adopted by HUL

 HUL (Hindustan Uni Lever Ltd) formerly HLL and see how the complex task of brand management is actually handled. This company is taken for this article as HUL is considered as one of the most successful in Brand Management.

HLL has a large brand portfolio consisting of nearly 110 bands. In every product line, it has built a number of brands over a period of time. Quite a few brands have come to its fold from the parent company. It has also acquired several ongoing brands from the market. HLL also vigorously pursues brand extension strategy. And concurrently, HLL undertakes line pruning and brand restructuring and consolidation, based on marketing compulsions. HLL is also playing the rejuvenation and re-launch game. With great benefit the corporate-level endeavors at business expansion and diversification are also throwing new challenges on the brand strategy front. HLL lends itself for a proper understanding of the complexity of the brand management task. We shall examine how HLL handles the complex demands in brand management.
Such an array of brands is the outcome of a conscious corporate strategy by HLL. As a corporate, HLL wants to be a leader in every one of its businesses and the strategy is to fight on the strength of the competitive advantage arising from the possession of strong brands. It is this strategy that is getting reflected in the development of a multitude of strong brands. If we take the business of bathing soaps, as an example, HLL has the objective of being a national player (not a niche or a regional marketer) and the leader therein. HLL also wants about 30 per cent of the corporate income to come from this line.

So, HLL opted for the strategy of developing quite a few strong brands in this line, and among them they cover different market segments and price points. Dove, Lux, Liril, Rexona, Pears and Lifebuoy are the outcome of such a well planned brand strategy.

Strategic Planning and Market orientation


CORPORATE AND DIVISION STRATEGIC PLANNING


STRATEGIC PLANNING AT HUL

VISION OF HUL
HUL's vision is to continuously innovate technologies to further reduce water consumption and further increase conservation in its operations. Simultaneously, HUL sites will progressively help communities, wherever required, to develop watersheds.
MISSION OF HUL
Unilever's mission is to add Vitality to life. We meet everyday needs for nutrition, hygiene, and personal care with brands that help people feel good, look good and get more out of life.
CORPORATE PUPROSE 
Unilever's mission is to add Vitality to life. We meet everyday needs for nutrition; hygiene and personal care with brands that help people feel good, look good and get more out of life.
Our deep roots in local cultures and markets around the world give us our strong relationship with consumers and are the foundation for our future growth. We will bring our wealth of knowledge and international expertise to the service of local consumers - a truly multi-local multinational.

Our long-term success requires a total commitment to exceptional standards of performance and productivity, to working together effectively, and to a willingness to embrace new ideas and learn continuously.
To succeed also requires, we believe, the highest standards of corporate behaviour towards everyone we work with, the communities we touch, and the environment on which we have an impact.
This is our road to sustainable, profitable growth, creating long-term value for our shareholders, our people, and our business partners.
VALUES AT HUL
Unilever has earned a reputation for conducting its business with integrity and with respect for the interests of those our activities can affect. This reputation is an asset, just as real as our people and brands.

Our first priority is to be a successful business and that means investing for growth and balancing short term and long term interests. It also means caring about our consumers, employees and shareholders, our business partners and the world in which we live.

To succeed requires the highest standards of behavior from all of us. The general principles contained in this Code set out those standards. More detailed guidance tailored to the needs of different countries and companies will build on these principles as appropriate, but will not include any standards less rigorous than those contained in this Code.

We want this Code to be more than a collection of high sounding statements. It must have practical value in our day to day business and each one of us must follow these principles in the spirit as well as the letter.


Standard of Conduct

We conduct our operations with honesty, integrity and openness, and with respect for the human rights and interests of our employees.

We shall similarly respect the legitimate interests of those with whom we have relationships.

Employees
  
Unilever is committed to diversity in a working environment where there is mutual trust and respect and where everyone feels responsible for the performance and reputation of our company.

We will recruit, employ and promote employees on the sole basis of the qualifications and abilities needed for the work to be performed.

We are committed to safe and healthy working conditions for all employees. We will not use any form of forced, compulsory or child labour.

We are committed to working with employees to develop and enhance each individual's skills and capabilities.

We respect the dignity of the individual and the right of employees to freedom of association.

We will maintain good communications with employees through company based information and consultation procedures.



Consumers
Unilever is committed to providing branded products and services which consistently offer value in terms of price and quality, and which are safe for their intended use. Products and services will be accurately and properly labeled, advertised and communicated.

Shareholders



Unilever will conduct its operations in accordance with internationally accepted principles of good corporate governance. We will provide timely, regular and reliable information on our activities, structure, financial situation and performance to all shareholders.

Business Partners
Unilever is committed to establishing mutually beneficial relations with our suppliers, customers and business partners.

In our business dealings we expect our business partners to adhere to business principles consistent with our own.

Community Involvement

Unilever strives to be a trusted corporate citizen and, as an integral part of society, to fulfill our responsibilities to the societies and communities in which we operate.


Public Activities

Unilever companies are encouraged to promote and defend their legitimate business interests.

Unilever will co-operate with governments and other organizations, both directly and through bodies such as trade associations, in the development of proposed legislation and other regulations which may affect legitimate business interests.

Unilever neither supports political parties nor contributes to the funds of groups whose activities are calculated to promote party interests.

The Environment


Unilever is committed to making continuous improvements in the management of our environmental impact and to the longer-term goal of developing a sustainable business.

Unilever will work in partnership with others to promote environmental care, increase understanding of environmental issues and disseminate good practice.

Innovation


In our scientific innovation to meet consumer needs we will respect the concerns of our consumers and of society. We will work on the basis of sound science applying rigorous standards of product safety.

Competition


Unilever believes in vigorous yet fair competition and supports the development of appropriate competition laws. Unilever companies and employees will conduct their operations in accordance with the principles of fair competition and all applicable regulations.

Business Integrity


Unilever does not give or receive whether directly or indirectly bribes or other improper advantages for business or financial gain. No employee may offer give or receive any gift or payment which is, or may be construed as being, a bribe. Any demand for, or offer of, a bribe must be rejected immediately and reported to management.

Unilever accounting records and supporting documents must accurately describe and reflect the nature of the underlying transactions. No undisclosed or unrecorded account, fund or asset will be established or maintained.

Conflicts of Interests


All Unilever employees are expected to avoid personal activities and financial interests which could conflict with their responsibilities to the company.

Unilever employees must not seek gain for themselves or others through misuse of their positions.

Compliance – Monitoring – Reporting



Compliance with these principles is an essential element in our business success. The Unilever Board is responsible for ensuring these principles are applied throughout Unilever.

The Group Chief Executive is responsible for implementing these principles and is supported in this by the Corporate Code Committee comprising the General Counsel, the Joint Secretaries, the Chief Auditor, the SVP HR, the SVP Communications and the Corporate Code Officer, who presents quarterly reports to the Unilever Executive.

Day to day responsibility is delegated to all senior management of the regions, categories, functions and operating companies. They are responsible for implementing these principles, if necessary through more detailed guidance tailored to local needs, and are supported in this by Regional Code Committees comprising the Regional General Counsel together with representatives from all relevant functions and categories.

Assurance of compliance is given and monitored each year. Compliance with the Code is subject to review by the Board supported by the Corporate Responsibility and Reputation Committee and for financial and accounting issues the Audit Committee.

Any breaches of the Code must be reported in accordance with the procedures specified by the General Counsel. The Board of Unilever will not criticise management for any loss of business resulting from adherence to these principles and other mandatory policies and instructions.

The Board of Unilever expects employees to bring to their attention, or to that of senior management, any breach or suspected breach of these principles.

Provision has been made for employees to be able to report in confidence and no employee will suffer as a consequence of doing so.