Effective change management plays a key role in the transformation of organizations; it makes sure that companies would execute changes smoothly and efficiently. Today, we’ll discuss Unilever change management case study; its historical background, internal and external factors that compelled the company towards change management, how the company implemented changes, and the impact of changes.
Some of the main products and services of Unilever are as follows;
- Personal care
- Beauty products
- Soft drinks
- Bottled water
- Pet foods
- Air purifier and water
- Cleaning agents
- Breakfast cereals
- Pharmaceutical and consumer products
- Baby foods
- Instant coffee
- Energy drinks
- Ice creams
Historical Background of Unilever
- 1929 – Unilever came into existence as a result of a merger between Lever Brothers and Dutch Margarine Unie on September 02, 1929
- 1943 – The company bought two UK brands Batchelors Peas and T.J. Lipton
- 1950s – Launched two subsidiary brands Sunsilk in the UK, and Dove in the US
- 1960s – Edible fats and laundry soaps are the major contributors to the company’s profit
- 1971 – Unilever bought Lipton Ltd from Allied suppliers
- 1984 – The company bought the tea brand “Brooke Bond” for 390 million British Pounds
- 1992 – The company expanded its operations in Africa by establishing Unilever Ghana
- 2001 – Unilever divided its business operations into two areas; home and personal care and food
- 2022 – The consumer brand is operating its business in 190 countries; approximately 148,000 employees are working for the company and Unilever’s total asset worth is 77.821 Euros
Factors Compelling Unilever Towards Change Management
Some of the main internal and external factors that pushed the company to implement changes in the Unilever change management case study are as follows;
Unilever was aware of the significance of organizational culture and recognize the requirement of innovative and agile culture within the organization. In order to deal with the organizational culture issue, the company launched a transformational culture program “Connected 4 Growth.” It focuses on the following;
- Restructuring the company into smaller independent business departments
- Giving employees autonomy to take risks and experiment with new ideas
- Promotes an entrepreneurial culture that allows quick decision making
The financial growth of Unilever was decreasing especially in 2017, and it forced the company to review strategically company’s operations. It allowed the company to make a decision of diversifying its business operations and put emphasis on personal and beauty care products.
Unilever was aware of the fact that implementing changes at the top of the hierarchy has a great impact. For instance, the company hired Paul Polman as the new CEO of the consumer brand in 2009 and he brought structural changes;
- Streamlining the company’s operations and putting emphasis on sustainable growth
- Integrating the personal care and food division of the company
- Expanding the company’s business in the emerging markets
Technological development is the main driving force and it compels companies to launch new methods of doing things. For instance, online shopping trends have been increasing, they pushed the company to launch an e-commerce platform to optimize the company’s digital marketing efforts. In fact, Unilever partnered up with Alibaba to expand its operations in China.
The consumer product market has become highly competitive over the past two decades and it pushed the company to launch organizational changes. Especially, the company faced a lot of competitive pressure from the developing markets China and India in the consumer goods category. In order to deal with the competition, Unilever took the following steps;
- Streamline its operations to become cost-efficient and effective
- Integrating the company’s global supply chain operations
- Localizing the company’s products
- Launching marketing strategies to make the company’s products attractive to the customers
Changing customers’ demands and preferences have got a great impact on the company’s operations and strategy. For instance, customers nowadays prefer sustainable and eco-friendly choices; it compelled the company to develop more sustainable and eco-friendly products and services. The company planned to decrease plastic packing by the mid of 2025.
Unilever Implemented Changes – Steps
Some of the key steps Unilever took in implementing the changes in the Unilever change management case study are as follows;
Unilever has diversified its portfolio many times over the years comprising core and non-core products and services. For instance, the company bought the Latin American personal and home care brand Quala in 2018. It focuses on amplifying the company’s position in the developing markets.
On the other hand, Unilever decided to leave the tea market and focus on high-growing areas. The portfolio expansion helped the company to be quick, and agile, and embrace the changing market trends and conditions.
Unilever recognized the fact the company needed agile and innovative culture. In order to transform organizational culture, the consumer brand initiated the “Connected 4 Growth” cultural program it focused on the following;
- Allowing quick and innovative decision making
- Promoting entrepreneurial culture within the organization
- Empowering and encouraging employees to take risks and experiment with new ideas
- Dividing organizational structure into smaller independent units
Unilever recognized the online shopping trend and the company invested in digitalization to gain a competitive edge. The consumer brand introduced a dedicated Unilever e-commerce and digital platform in 2017. In fact, the company also partnered up with Alibaba to expand its operations in China. In order to amplify tech capabilities, the company bought various tech and digital startups and companies.
Unilever brought various structural changes within the organization over the years with the objective of amplifying the company’s growth and productivity. For instance, the company unified its personal care and food division in 2016; it focuses on achieving cost efficiency. The consumer brand strategically evaluated its operations in 2017 relevant to the company’s slower growth and declining sales.
Unilever introduced a “sustainable living plan” in 2010 and it focuses on decreasing the carbon footprint on the environment, improving profitability, and social impact. The plan forced the company to take on various sustainable steps and initiatives;
- Biodegradable product packaging
- Accountability and transparency
- Improving the livelihood of millions of people
- Decreasing the greenhouse gas emission by 50%
Impact of Unilever Change Management Program
Some of the main results and impact of successfully implementing the changes in the Unilever change management case study are as follows;
The focus of Unilever is on product development and innovation; it helped the company to introduce new brands and products. For instance, the company launched “vegetarian butcher” a plant-based meat alternative brand. The development of products and brands helps the company to improve customer satisfaction and growth rate.
Transforming organizational culture and structure has allowed the company to promote entrepreneurial culture. It allows Unilever to follow the agile approach and quickly respond to changing market conditions.
Unilever invested a significant amount of resources in digital transformational projects to amplify the company’s growth in the digital field. It led the company to acquire various tech startups and tech companies, and partner with the world’s leading e-commerce platform Alibaba.
The focus of Unilever has always been on strategic acquisition and portfolio expansion; it helped the company to amplify company’s financial growth, sales, and profitability.
The change program has allowed the company to move toward sustainable and environmentally friendly practices. It helps Unilever to decrease its environmental footprint and improve social impact; the company plans to
Conclusion: Unilever Change Management Case Study
After an in-depth study of Unilever change management case study; we have realized that Unilever has gone through a series of transformations over the years. If you are learning how the consumer brand implemented various change programs, then you should keep in mind the abovementioned factors.
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