Financial Daily from THE HINDU group of publications
Saturday, Dec 17, 2005
Corporate - Announcements
HLL plans more unified functioning CEO Douglas Baillie to take charge in March
Mr Harish Manwani, Chairman.
Mumbai , Dec 16
HLL is to have a CEO supported by an extended management committee and a more unified functioning of the separate businesses.
Effective from March 1, 2006 Mr Douglas Baillie, currently Group Vice-President and head of Unilever AMET (Africa, Middle East, and Turkey), will be CEO of HLL and Group Vice-President overseeing the Unilever business in South Asia. This is the first time in several years that HLL is getting an expatriate CEO. Within Unilever's Asia-Africa markets, AMET is the biggest revenue contributor.
Speaking to newspersons, Mr Harish Manwani, President of Unilever Asia and Africa, and Chairman of HLL, said that more managerial changes, albeit of less magnitude, would be announced in the third week of January.
This would include further additions to the current national management committee (currently being called "management committee") and a more unified functioning of the company's separate businesses in tune with the `one-Unilever' concept.
The revised management committee will seek to treat the businesses more as categories and less the divisions they are currently.
HLL's core business divisions are home and personal care (HPC) and foods. It is not clear whether the practice of having managing directors for these businesses would remain. "These are early days," Mr Manwani said.
The basic principle
The basic idea behind the `one-Unilever' concept is to create scale, retain focus, and avoid duplication.
"We want to bring these businesses (i.e., HLL's HPC and foods businesses) closer to take advantage of scale without losing their separate long-term focus. There may also be other changes lower, depending on the changes at the top. There will be no other restructuring in terms of portfolio and brands," he said.
What is being attempted was a more conventional structure in which everyone sits around the same table and the CEO runs the business with strategic guidance from the non-executive Chairman. "We now have a single line of command."
Asked why HLL took a roundabout route to this system of governance, Mr Manwani said that management models were not cast in stone and that companies have to respond to the situation at given times. The new structure is also not a model that Unilever is migrating across geographies. Rather, it is based on certain principles, dominant of which is the `one-Unilever' concept.
Adhikari to head Japanese operations
Alongside Mr Baillie assuming charge as HLL's CEO, Mr Arun Adhikari, currently the company's Managing Director (HPC), will take over as Chairman, Unilever Japan. He is the first Indian to be appointed so.
"This is not a surprising move but it is an important move for HLL," Mr Manwani said on the posting to a highly developed market. Forty per cent of the world's skin care market is in Japan and Korea.
Coincidentally, the announcement regarding Mr Adhikari was also a day after HLL's detergent brand, `Wheel', became Rs 1,000-crore worth. "The FMCG market growth is being sustained. This year we expect market growth to be 5-6 per cent," Mr Manwani said.
Plan to grow market share
HLL's overall business grew by 10 per cent over January-September 2005; its FMCG business alone by 12 per cent with HPC growing at 13 per cent and foods at 7 per cent. "For the first time in several years, we have clocked double-digit growth."
Mr Manwani also said that this growth was due to HLL's focus on its core business, which it had successfully renovated.
HLL will concentrate on growing its market share, fighting the battles already on in laundry and detergents, and driving costs lower. "Market share is very important as a measure of competitiveness," Mr Manwani said.
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