Organizing
Organizing is the function of management which follows planning. It is a process of determining the task to be done and who will do them. To ensure the achievement of objectives, organizing process also included developing an organization structure relationship and allocating resources effective. The job analysis is prepared based on the basis information that provided by job design. It helps the organization to choose the best suited candidate for the job. Through organizational structure, the chain of command, authority, responsibility and accountability are established. Kimberly-Clark announced radical reorganization plan which based on “grow, sustain, and fix” categories in 2003. At the same time, Kimberly-Clark announced forecasts for sales increases downward from 6% to 8% and annually from 3% to 5%. It caused the negative effect to the organization. In 2004, Kimberly-Clark decided to present a new and different organizational structure by its products and their market potential versus by category. It would organize around personal care, washroom products and emerging markets. An organization should always consider organizing function to ensure the accomplishment of planning.
Leading
The third function of management is leading. Leading is the process of motivating and guiding the members of work groups in the organization for carrying out their work and archive the goals. Kimberly-Clark’s Board was organized by 12 directors who have a leadership and various backgrounds that had brought more experience and knowledge to the company. Kimberly-Clark also have built a strong leadership and visionary thinking into a worldwide organization focused on leading the world in essentials for a better life. Under Mr. Falk’s leadership, Kimberly-Clark’s total shareholder return has outstripped the S&P 500 and reached sales of $19 billion in 2015. Kimberly-Clarks state that their employees are the most valued resource and indispensable because their aptitude, diversity and commitment are important to our innovation and success. Kimberly-Clarks build a performance-driven organization to improve and maintain the top talent. For example, employee’s salary will depend on performance management process with the feedback from their superior, plus annual 360 degree feedback. Besides, Kimberly-Clark will use core Leadership Qualities to measure the annual valuations review performance against objectives and behaviors. Under Sue Dodsworth’s leadership as the company’s global diversity officer, the initiative which the women play an important role in the workplace and marketplace was launched in 2009 as Kimberly-Clark began executing a new people strategy to change the culture and involve talent who will lead the company to success. Between 2009 and 2013, women’s representation among Director+ roles has increased worldwide from 19.0% to 26.0% and internal promotions of women to Director+ jobs has increased significantly, from 19.0% to 44.0%. Besides, women’s representation on the Board of Directors also has increased from 16.7% to 25.0%.
Controlling
The controlling function includes monitoring performance, comparing it with what was planned, and taking corrective action. This function does not imply that managers should effort to control the personalities, values, attitudes, or emotions of their subordinates. Instead, this function of management concerns the manager’s role in taking necessary actions to confirm that the job-related activities of subordinates are constant with and contributing toward the achievement of organizational and departmental goals. The company’s sustainability strategies are set every five years and consist of specific targets under three ‘pillars’ – People, Planet, and Products. 2016 was the first year of sustainability 2022 strategy and we made good progress as company began to tackle the tasks related with our new objectives. In 2016, Kimberly-Clark stated that 3 out of 5 targets had achieved there are social impact, forest and fiber, energy and climate which are 2.05 million lives impacted target through social programs exceeding its 2 million target, reduced 26% in natural forest fiber use exceeding its 25% target, and reduced 16.8% in absolute greenhouse gas emissions against a 2005 baseline exceeding its 10.6% target but have only two targets did not reached which is waste and recycling, and supply chain. Kimberly-Clark stated that the organization will be moving toward the achievement of 2022 goal when improving the welfare of 25 million of people through social impact and reducing 50% from its “natural forest footprint”. The zero waste mindset will be extended to avoid landfilling of 150000 MT of product and packaging material use. Kimberly-Clark set a 20% greenhouse gas reduction target against a 2005 baseline as a final objective.
Important success factors
Kimberly-Clark has grown into one of the largest global manufacturers which produced variety of tissue and hygiene products. There were few important success factors that lead the company can operation more than 145 years.
Kimberly-Clark committed to corporate social responsibility (CRS) through their practices and relationships with all stakeholders and the communities they served. Kimberly-Clark has been recognized as the “100 Best Corporate Citizens” by Corporate Responsibility Magazine. The actions of Kimberly-Clark that contribute to social welfare such as help the low-income family to improve lives through the areas of education, financial stability and health. By having CRS efforts, its can enhanced the reputation of Kimberly-Clark.
Kimberly-Clark’s sustainability strategies are set every five years. It also can be identified as a key to success continuously. Environmental Protection Agency (EPA) recognized Kimberly-Clark at the 2016 Climate Leadership Awards. Kimberly-Clark is always conscious of the need for continuous innovations in Eco-friendly product. Kimberly-Clark also launched Green Harvest products which incorporate renewable plant-based fibre like bamboo into Kleenex brand towel and tissue products.
According the Fortune 500, Kimberly-Clark’s brands placed 151 on the Fortune Global list in 2015. Currently, Kimberly-Clark’s brand such as Huggies, Kleenex, and Pull-Ups are foremost brand in their segment in more than 80 countries. Brand Kleenex has been recognised as 100 World’s
Most Powerful Brands in 2012. Every fourth of the global population bought its products on a daily basis. This is another important success factor to Kimberly-Clark because it represented that the brands of Kimberly-Clark have strong brands recognition to enhance consumer loyalty and the stably market also provide a good platform to improve their products.
In 2013, Kimberly-Clark Corporation was placed No. 6 among “The World’s Best Multinational Workplaces” in one of the largest and most respected annual studies of workplace excellence and corporate management practices. This award is the important success factor to Kimberly-Clark. This is due to the more of talented people will consider Kimberly-Clark as their first choice to work. This not only will bring a benefit to business also to employees because Kimberly-Clark will provide a good workfare to their employees such as guaranty employee’s health and safety to strive for zero workplace fatalities.
Main challenges of company will face over next five year
The main challenges of company will face over next five year are intense competition and rising input commodity costs impacting margins. Kimberly-Clark faces an intense competition among its major competitors such as Procter & Gamble Company, Unilever Plc, and Johnson & Johnson because they sold different set of product as personal care and other fast moving consumer goods segment. Besides, the new entrants such as Mamy Poko from Japan’s Unicharm group also giving a tough competition to Huggies in Asia markets in the diapers segment. When the alternative in the market become more, consumers have more choice to choose and will consume the better ones.
The input commodity costs also a challenge of company will face over next five year. This due to the price of wood pulp which is the main raw materials of tissues has adversely affected Kimberly-Clark’s profits, consume tissue division generating a third of the organizations revenue. According to IBISWorld, the price of wood pulp will be rising by a CAGR of -5% until 2019. Kimberly-Clark needs to find other alternative sources as the raw material at the lower cost and reduce reliance on natural forest products. Therefore, the prices force to increase for sustain profit.
Foreign currency exchange rates also bring a challenge to Kimberly-Clark. This can prove in the exchange rate contributed to a 6 percent dip in fourth quarter and a 5.7 percent dip in full year 2015 sales. The strength of the U.S. dollar continued to prove troublesome for Kimberly-Clark during the quarter, with foreign currency headwinds setting sales by 7 percent. This is a continuing issue for Kimberly-Clark, which sells merchandises in more than 175 countries.
Recession economic conditions are discouragement consumer reliance toward the product and lower their purchasing power as a consumer especially in Kimberly-Clark’s core North American market. This could affect the consumer tendency to higher margin products that has offered the potential to generate growth in mature market conditions in recent years. Kimberly-Clark continues to rely on the Americas, and particularly the US, for a large proportion of its sales although it has developed a global coverage.