Maravi

Consumer product firms transform to defy credit crunch

Consumer product firms transform to defy credit crunch
Written by Kabanda Chulu
Friday, June 26, 2009 4:00:27 PM

PRICEwaterhouse Coopers (PWC), in cooperation with the Economic Intelligence Unit, has launched a report stating that Retail and Consumer product companies are transforming to maximise potential in emerging markets despite the current economic downturn.

It stated that large-scale investments have been made in these countries with the expectation of significant growth since there was intense pressure to deliver on growth targets.

According to the report titled, ‘Building to win: How multinationals are structuring to compete in emerging markets’, to be successful in these markets, both retailers and consumer products companies were restructuring themselves, though their transformations were coming from different vantage points.

“Retailers, with their shorter tenure in emerging markets are restructuring to penetrate markets better, which usually means decentralising and allowing more flexibility and regional offices are established to provide strategic direction and planning support, develop talent for the region and evaluate new opportunities for property acquisitions or new market entry,” it stated. “On the other hand, consumer products companies, most of which already have strong brand presence, are streamlining and centralising parts of their organisations in regional offices to leverage economies of scale in areas like shared services and supply chain.”

The report, which is an analysis of 40 leading companies, stated that to ‘act local’ in the market, multinational companies were employing managers who understood local culture and preferably were natives of that country.

“However executives interviewed said that the same rule doesn’t apply for regional head offices. They think it is more important to staff the regional headquarters with executive talent of the right level of seniority and with a global, rather than local, outlook,” stated the report.

“And further findings reveal that although retail and consumer products companies have created strong employment brands in emerging markets and are highly sought after by job seekers, talent retention and leadership issues are among the most challenging areas for these companies to manage.

Labels: GREAT DEPRESSION II, PWC

posted by MrK @ 3:00 PM