AG Lafley's Leadership in Procter and Gamble


He is a strategist that has a big eye-sight and changes the guidelines of the game that his company participates in. He's a originator who boosts his company's profitability by technology to make an organic and natural growth. He's a thinker who tightly feels that the consumers are the bosses somewhat than he. He's a savior who makes a company which was in some serious crises back again to the way of revival. He is also one of the world's most important business leaders, exactly like Steve Jobs, Invoice Gates and Warren Buffett.

He has been acquired many titles and achieved the highest recognitions in his business. He was known as "CEO of the entire year" by LEADER Magazine in 2006, "Executive of the entire year" by the Academy of Management in 2007, and "Leader into the future" by the Peter F. Drucker Innovator to Head Institute in 2008 (Silverman, 2009).

In my estimation, he's the best business leader and he makes the perfect blend of CEO (CEO) and CIO (Main Innovation Officer). Yes, the great man is Alan George Lafley, the previous Chairman of the Table, President and Chief Executive Officer of Procter & Gamble.

In this research newspaper, I will give you a brief introduction of the. G. Lafley's history and career. I QUICKLY will examine some leadership traits and leadership actions of him. From then on I will talk about how A. G. Lafley's command applied to the hospitality industry.

Brief Introduction of A. G. Lafley and his Career

Early life

On June 13, 1947, Alan George Lafley was created in a tiny city called Kiev in New Hampshire America. When A. G. Lafley was raised, he completed his review in a small liberal arts school which found in northern NY called Hamilton College or university. He had his own career plan in those days, which was to be always a professor and baseball mentor after graduation. In the late 1960s, he went to Paris where he researched history, politics, skill, film and theatre. In 1969, he came back to america and then came into the University of Virginia to review for the PhD degree which related to the history of the Middle-Ages and Renaissance. However, he remaining the university after only one semester. He became a member of the U. S. Navy, but didn't serve in warships. Because of this military services service, his plans and fate evolved after that. He was assigned to a U. S. armed forces air platform in Japan, in charge of the management of retail and service organizations. In that air base, roughly 1 million people, navies, marines and their own families, formed a little town. What Lafley handled were the whole retail and service organizations including grocery stores, shops and area of expertise stores. It's the first time that he worked as a general manager; furthermore, he fell in love with this job since that time. After old age of the Navy, he did not go back to the college or university to follow his previous imagine being a teacher or a mentor, but he visited the Harvard Business University to study for the MBA level.

After graduation from Harvard Business College, he joined up with Procter & Gamble in 1977 as an associate of a dishwashing detergent brand. In the following 15 years, he gained the positioning of the laundry powder and clean service team director. Within these years, Lafley and his team received so many successes. He led several the most successful inventions in P&G company's history such as "Liquid Tide" and "Tide bleach-type"-Until today, these kinds of development still contribute to the expansion of P&G. In 1994, he went back to Japan, but what he was in charge of was much larger than the retail business of the small town in the air platform 20 years ago. What he governed was all the P&G business in Asia. He laid the building blocks for P&G's Japan business growth swiftly and led China's business to have an extraordinary progress. In Asia, the sales of the merchandise are scarcely 90 million dollars before he came up, but it approached 1 billion dollars when he still left Asia in 1998. He also led the company to go away several serious currency crises and the economic crises properly. As we all know, japan Kobe earthquake happened in 1995 and Procter & Gamble Asia headquarters located perfectly there. These varieties of crises provided Lafley a strong mind and capacity to set up the duties and employees when disaster happened. Due to these experience he acquired in Asia, he has more self-confidence to method of another challenge-all the business enterprise in THE UNITED STATES where occupied the P&G's most significant market (Lafley and Charan, 2009).

In 2000, Lafley was elected to be the chief executive and CEO of Procter & Gamble and began to lead 110, 000 P&G's employees who distributed in 70 countries. The P&G was just in a large trouble due to a series of radical plans created by the ex-CEO Durk I. Jager. Jager developed the new product blindly. He did not give attention to the key competitive product. Furthermore, P&G was a very conservative company at that time. With many other reasons, the company fell into a major failure. Luckily, the advancement of Lafley saved P&G. Lafley made a new policy decisively-"Continue to promote the progress of the core features of resources and profit from it. " (Lafley, 2000) Lafley focused on the old brand and made a delicate revolution at exactly the same time. He replaced 50 % of the older officials and lower away practically 10, 000 careers to make P&G more flexible and professional. "Innovation" was Lafley's primary concept. Regardless of by motivating the organic development of the company or by merging the others' masterpieces, Lafley never stopped to innovate. He said: "Each business has its core organization principle. And the process in P&G is innovation. " (Lafley, 2009) What's more, Lafley wish to make an exception to market the skilled person and he was good at cooperating with other folks and companies. Under his management, sales of P&G were almost doubled-from 39 billion dollars to 76 billion dollars. Procter & Gamble Company became the North american top 10 10 most valuable company and the world's top 15 most valuable companies after that. And it was regarded as one of the most respected company from then on.


On July 1, 2009, Lafley resigned the CEO officially and said no longer portion as chairman since January 1, 2010.

Leadership Traits of an. G. Lafley

A. G. Lafley, who has rich life activities and has obtained a plenty of great accomplishments, is a great leader. The fantastic person has its greatness which may be regarded as some fabulous leadership traits. So what are they?

Excellent education

Mr. Lafley, who obtained a B. A. (Bachelor of Arts) degree ever sold from Hamilton College or university, briefly pursued a professional degree in middle ages and renaissance record at the University or college of Virginia and got a MBA level from Harvard Business University, is well-educated (Ellison, Zimmerman, Forelle, 2005). They make him versatile and gentle. Definitely they also have a big affect on his profession. The wonderful education offers him the capability to offer with various duties and manage a business giant. For me, although almost all of the benefits brought by education are unseen, the level of knowledge decides the amount of attitude which further influences the altitude of success. For instance, how do he achieved such a huge successful in invention? It is due compared to that he knew the marketplace and he came to the realization the particular consumers' need and want. He may use what he has learned to analyze the problem and circumstance of the company. Without the knowledge, they can do nothing. That's why excellent education plays a quite important role in Lafley's life.


Lafley is kind and humane person. But as a leader, he recognizes that if it's the time to produce a judgment or a choice, then you should make it. This means that a head should have the assertiveness. A leader's judgment or decision can determine the success and the inability of an organization at some times. The stage of making wisdom is often as quick as the turn of the switch but can impact a long-time period (Tichy, Bennis, 2007). However, making a good view is not easy, especially with a restricted time frame. Lafley places a vivid example of how good judgment is developed. Lafley became CEO of P&G in 2000 with the company in the best trouble. On the day Lafley was announced as CEO, the stock fell down another $4; by the finish of 2000, the business's market capitalization acquired lost $85 billion weighed against the prior year. But as a skilled innovator, Lafley never dropped nervous. WHEN I discussed earlier, his numerous experience always can make him assertiveness. Five years ago, Lafley experienced the substantial Kobe earthquake. That 7. 2 magnitude earthquake damaged more than 45, 000 homes and wiped out more than 6, 000 people, instantly plunging Japan into crisis. Lafley, who was simply responsible for the business enterprise in Asia for P&G at that time, immediately made an assurance that P&G's employees were safe and then started out to adopt stock. He knew how to stabilize the morale of the troops and he are designed for this issue effectively step-by-step. The experience train him the value of facing actuality and planning as ways to be sure a innovator uses all available resources in times of problems (DeRose, Tichy, 2008). Therefore, experienced the adverse situation at the year end of 2000, he can quickly identify the problems that most needed to be solved-the unnecessary business. So Without a moment's hesitation, Lafley made a decision that trimming the unneeded business immediately and focusing on their central business. He's very assertive which is because of his assertiveness made the business escape the dangerous situation and have a much better and faster development in the following years.


We have previously known that Lafley's major is record at the beginning of his studies, but he's very proficient at innovation. He comes with an admirable capability of creativeness that can make "an elephant dance". When Lafley took over the P&G Company in the summer of 2000, the fact was quite grim as I've already talked above. His predecessor, Dirk Jager, a brusque hard-charging Dutchman who ran the business enterprise of P&G for 17 months, just made one thing grow up: it is the costs. After analyzing the situation, Lafley was alert to that the P&G Company needed the technology to bring consumers back again, but innovation well balanced by efficiency (Martin, 2009). The successful technology is not simply invent a fresh product or create a new form of organization but is able to discover something that may bring commercial benefits and can create new value which means the particularly things can adapt the business's situation in the market place and maintain the partnership with the customers. We can see what Lafley has done. He encouraged innovation in the business and enhanced the company's attention on the creativity of the central brand such as Crest and Tide. But he was still not satisfied with the P&G's innovation speed and accomplishments, he arranged a vivid goal: Instead of developing most inventions in-house, P&G would contract for half of its improvements from outside options. This development model called "Connect plus Develop". From the two-way street, accessing externally developed intellectual property in its own marketplaces while allowing its internally developed investments and know-how to be used by others (Lindegaard, 2010). This program gave P&G usage of a worldwide network of innovators, and it used the firm's existing algorithm-level marketing and circulation skills (Martin, 2009). The performance ended up being a great success, with income that doubled. In 2005, the Boston Consulting Group seek advice from P&G as the "Top 10 10 Innovative Companies on the globe" for the reason that "Continuous product development based on knowledge of changing consumer life-style" (Nussbaum, Berner, 2005). The actual fact of growth and revival of company break the notoriously rule-bound culture that P&G should rely on itself to develop. It is true that Lafley's creative imagination help the 173-years-old huge change its destiny and achieves a new success.

Administrative ability

As an enterprise leader, no matter how much education you received, no matter how assertive you are when you decide, no subject how imagination you hold, if you do not have administrative capability, everything will make no sense. The administration can manage employees to work proficiently and lead the company to do things right. For Lafley, he uses this kind of potential to specify P&G's prices and specifications which encourage the right behaviours. The beliefs for P&G is a word-"Trust" which is shown in three aspects. First, trust of employees. Therefore you can earn the employees' loyalty. The employees will be the greatest wealth. When your employees wish to devote their lifetime for you company, then this is the fifty percent of the battle. Second, trust of consumers. Consumer is the god. All you do are to meet the customer. That is the last goal every company wants to accomplish. The last but not least, trust of investors. That's also exactly important for a mature company. It could bring P&G secure long-term ventures (Lafley, 2009). The typical made by Lafley for the business enterprise of P&G is that each one should maintain the most notable third of its industry field. This standard is determined to be P&G's major performance strategy tool and is linked to the leadership settlement. Lafley establishes this wonderful value-creation mind-set with account of the shareholder's perspective and it creates a great contribution to P&G's business.

What's more, Lafley has a strong ability to understand and discover his subordinates. WHEN I researched, Lafley is aware the very best 500 people in P&G. He also requires himself in career planning for the 150 potential presidents or function minds. He does indeed a great deal of jobs on planning assignment, assessing advantages and weaknesses of these people and trying to put them before the table at company occasions (Lafley, 2009). This ability helps Lafley absorb so many gifted people, which shows the shiny future for P&G Company and also lays a good foundation for the business's ecological development.


Lafley stresses cooperation with his subordinates. He stimulates teamwork among professionals, employees and also himself. He has a cooperative and inquisitive management style. When Lafley makes a decision or models a fresh strategy, he usually asks professionals to give him two different techniques and present the professionals and cons of each. " (Hymowitz, 2006) By successful teamwork, Lafley barely makes wrong judgments. Lafley will not only cooperate with inside staffs of the business, but also he builds a good tactical partnership with other companies.

The globalization is the world's trend and for certain no company can grow quickly and smoothly without cooperate with others. Lafley came to the realization this serious reality soon after taking over the CEO of P&G. He discovered that the Wal-Mart Stores has an unique gain that other merchant does not have-it will not only source products at the lowest price but also get visitors to turn back to the Wal-Mart for goods they normally find anywhere else, at specialty stores, restaurants or even the doctor's office (Ellison et al. , 2005). So Lafley decided to update P&G's products and make sure they are so glamorous and distinctive that Wal-Mart will not be able to withstand them. Following the upgrading of P&G products and the negotiation with the head of Wal-Mart, every one of the products made by P&G are available at Wal-Mart. For P&G and Wal-Mart, "it's nearly the same as a married relationship, " Lou Pritchett, P&G vice president of sales, said. This "marriage" is a win-win conflict.

Lafley's Leadership Behaviors

Supportive leadership behaviors

The innate personality and excellent education make Lafley friendly and experienced. Many people say Lafley is similar to a serene professor than a great business innovator. Actually, expect the personality and education factors, the primary conception of Lafley-"innovation" makes a obtain him to be a supportive innovator.

Because the result of innovation is often uncertain and sometimes it could be associated with a lot of risks, the first choice is requested to support the employees and promote them to get the job done as better as they can. Using the leader's supportiveness, even if the task is not developed as the program place, the subordinates will not lose their assurance and tolerance. Lafley always induces the R&D's (Research and Development) team members and shows his trust and respects to team. He always says, "You have a good job. I appreciate your efforts. You have been working very difficult, etc. " The truth is they never let Lafley down.

What is more, in the authority traits section I described that Lafley has a distinctive ability that he is able to remember the very best 500 managers in P&G. And he is willing to help them develop their profession. Lafley believes that a good manager can become an technology leader by obtaining proper training and obtaining some creativity related work experience. So he provides training system and opportunities to the subordinates. For instance, P&G offers a course which can enhance the rate of successful advancement and builds an innovation centre for employees to talk about and discuss their working experience (Lafley, 2008). For the experienced professionals, Lafley provides them more specific jobs that happen to be related to more uncertain risk. It is very helpful for these managers in obtaining the precious activities. Further to make sure that these managers can make a good planning for the first choice position. Along with his proper supportiveness, most of them did very good careers. Lafley's supportive command behavior satisfies the subordinates and makes them work harder and harder. The followers can find their self-value plus they really love work for him. In another expression, Lafley brings much more earnings to the employees and the business with his supportive leadership behavior.

Reward management behaviors

Everybody would like to be rewarded and when one is praised in public place, it will form an optimistic working atmosphere and build-up the sense of honor in employees' head. Obviously Lafley possess the reward power and also he would like to utilize it, because he has learned that when praise happened, it'll encourage more folks to work harder for getting the reward. Which way can lead the organization to expand healthily and swiftly.

For case, P&G establishes an twelve-monthly Award for Invention which used to reward those individuals whose projects can provide consumers better value and less cost than its rivals. This award is established to be able to prize the employees who create huge revenue by finding innovative business way. When the reward time comes, a grand night time banquet is necessary and Lafley will give the big award to the winners along with his own hands and salute to them. The employees of P&G treat this as the highest honor as it should be.

Lafley's reward command behavior increases employees' shows and rises their enthusiasm. Also, the most crucial thing is usually that the pay back strengthens the progressive culture that Lafley wishes to establish in P&G which is a great help for company's development.

Innovation management behaviors

Most folks may be unfamiliar with Innovation leadership tendencies. Pekka Ala-Pietil, the Ex - Leader of Nokia defines it like this:"It is passion; it is learning; it is humility before problems and errors-understanding that they are necessary elements to learn faster than the others-and it's the target environment. . . yes, stretched goals!" (Ala-Pietil, 2001) For me, Lafley can be an innovative innovator with a great many other characteristics which are more mature compared with what Ala-Pietil thought. First, focused on the in-depth consumers' understanding, Lafley recognizes that the invention is based on the consumers' needs, so he believes consumer is the manager. Lafley stresses cooperation with consumers and asks them what actually they need and what they want. Then formulate another research and development goal. Second, after totally aware of the leading-edge technical, Lafley requests the R&D (research and development) office to boost P&G's products per calendar year and make a disruptive technology per seven years to be able to stay ahead of the industry. Third, creating the motivational organizational rewards, Lafley makes the P&G's innovation-reward process. This technique works such as this: If you generate a good innovation project, you'll get the reward. The business wish to invest more income to encourage you to develop another innovation in that you can get another prize. You can certainly find that this process is a virtuous circle that can make the business keep growing. All in all, Lafley's innovation authority behavior greatly increases the development of P&G Company. I believe only this management action can make such a huge company keep growing such as this.

A. G. Lafley in Hospitality Industry

Though Lafley has been worked well in consumer goods industry for more than 33 years and hasn't quitted before retirement life, if he chooses to are a hotel basic manager now, I believe he could be a good innovator also.

First, as an over-all administrator of the hospitality industry, you should be a supportive innovator because hospitality industry is a labor rigorous industry. Every day you will need contact and offer with people. Therefore, to be a leader, you should show your concern for the status, well-being and needs of your followers. In another phrase you should be supportiveness.

In this aspect, Lafley does a very good job. He knows how to show his matter and friendly to employees and he is able to built a good romance with the employees and give them more confidences. He always wish to show his supportiveness. If the duty is very hard, he'll show his account to the subordinates and never hesitate to say something like this, "you does a good job. I appreciate you a whole lot, etc. " When a harmonious work environment shows up, the employees' comforts of careers and determination of working harder will both increase, resulting in a much better performance and higher eagerness that will lead to more income and less turn-over rate.

Second, reward authority habit is very well suited for hospitality industry too for the reason that it is of a certain commonality in all business. Lafley is great at satisfying people who do the good job. Just like I have been mentioned, he established an innovation-reward system in P&G which brings an enormous benefit to the business and the employees. Aswell as what he has performed in P&G, if he works as a head in hospitality industry, he will establish some kinds of Award for Service Celebrity system which rewards the employees who get the most identification cards crammed by guests or who give the hotel most effective tips. In his impression, reward is the ultimate way to encourage visitors to work hard and innovate positively. By building this reward setting, they can improve morale of employees and improve organization at the same time. This means that his perspective of rewarding notion is quite useful in hospitality industry.

Third, innovative control patterns is also very important for hospitality industry. Nowadays, the majority of the five-star hotel can achieve the excellent standard, but what the real challenge is the ingenuity. Lafley won't change his innovative leadership behaviors. He would prefer to ask the guests feeling and needs, and then think out a fresh idea to provide guests completely different experience. Maybe he will set a goal for the chefs to creating the new food. Overall, it is for sure that he will use his innovation leadership behavior to help make the business stick out. That's critical performance for the distinctive fine dining hotel. And I believe it will bring the business a great success.


After researching A. G. Lafley's personality and career, I am stunned by this man who kept the world's largest consumer goods company in catastrophe. He is a good listener but also an assertive person; he is competent but also wants to collaborate with his subordinates; he never shouts but makes things structured in good order; he never invents anything but leads a high ten ground breaking company. It really is A. G. Lafley who just retired from the CEO of P&G 10 month in the past and is commented as "The departure of Procter & Gamble's A. G. Lafley is a loss for P&G - and the business world at large" by Fortune Small Business ( Reingold, 2009).

After thirty-three years fighting for P&G's success, Lafley finally determines to take off his Armani suit and wear his favorite casual khaki pants to truly have a rest. But his outstanding achievements, fabulous supervision abilities and interesting innovation leadership will always be there to let the people admiration and pursue.

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