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Supply Chain Trend

Shaping the world of s&op and supply chain.

Integrated Business Planning: A New Narrative for an Old Process

Integrated Business Planning (IBP) has been a valuable business process since its incarnation as Sales & Operations Planning in the mid-1980s. The monthly cycle of S&OP meetings has been the forum in which a firm’s forecasts have been presented and reconciled across functional areas. Authors Niels van Hove and Hein Regeer explain that while planning and forecasting technologies have benefitted from significant innovations since then, today’s IBP seems unhinged from the day-to-day operations of the business. They call for a reinvention of traditional IBP that more fully integrates its governing meetings and reporting into operations, enabling faster decision making, better responsiveness to disruption, and liberation for planners to work on more strategic issues.

• Many IBP cycles around the world are based on a 20-year-old process definition supported by 20-year-old planning concepts. This traditional IBP is not set up for a fast-changing world, where speed of decision making confers a competitive advantage. New Wave 3 Technology can empower a more efficient and responsive planning process.
• We propose that IBP be segmented by decision type into execution, operational, planning, and strategy/culture. For the execution and operational decisions, modern planning technology can largely automate processes and decisions. For the longer-term decisions on planning and strategy, technology will augment the quality of human-centric decisions and nurture human-machine collaboration.
• IBP should be converted from a separate, sequential, monthly planning cycle to an integrated component of day-to-day business. This will be feasible as new technology enables more autonomous decision making, freeing the planner to focus more fully on designing policies and targets

TRADITIONAL IBP AND PLANNING TECHNOLOGY

If we look back over the history of supply-chain planning, we can properly say we are in the third wave of integrated supply-chain planning software (Van Hove, 2019).

• Wave 1, Enterprise Resource Planning (ERP), started in the 1980s with a focus on automating transactional business processes, but less so on planning.
• Wave 2, Advanced Planning Systems (APS), first adopted in the 1990s, facilitated a forward view of the business, integrated plans with other functions, and optimized supply-chain metrics such as forecast accuracy, inventory holdings, and customer service.
• Wave 3 systems, now gaining momentum, will provide intelligent automation that replaces the human planning process as well as cognitive automation that augments a planner’s decision making with predictions, insights, and recommendations.

Wave 3 systems will enable fully automated planning, decision making, and execution. By bringing together several technologies that have matured separately over the last decade, it is becoming a system of intelligence, seamlessly integrating the following capabilities:

• Integration and harmonization of data from internal and external sources, with transactional data self-cleansed and planning parameters self-maintained.
• Automation of descriptive, diagnostic, predictive, and prescriptive analytics, including self-selecting machine-learning models for a library of predefined problems.
• Smart process flow through a digital twin that can be configured to mimic any business user during forecasting, planning, decision making, and execution processes.
• Prescriptive analysis and recommendations that provide business users with advice on why, how, and when to act.
• Automatic decision making and writeback of actions to underlying systems of record.
• Digitization of every decision made, using an automated loop that learns from both human and machine decisions.

At about the same time that Wave 2 was gaining momentum, we saw publication of the book Enterprise Sales & Operations Planning: Synchronizing Demand, Supply and Resources for Peak Performance (Palmatier and Crum, 2002). The authors detailed a sequential S&OP cycle around a

New Product Review, a Demand Review, a Supply Review, and a Management Business Review. Figure 1 is an image from the cover of the book.

Figure 1. The IBP Cycle According to Palmatier and Crum

A whitepaper by Coldrick, Ling, and Turner (2003) entitled “Evolution of Sales & Operations Planning – From Production Planning to Integrated Decision Making” presented the five-step process – shown in Figure 2 – which is still the foundation of most planning processes today, even though the scope of S&OP has expanded into IBP.

Figure 2. The Five Key Steps of Integrated Business Management / Integrated Decision Making

In his 2009 Foresight article, Bob Stahl emphasizes the five-step sequential monthly process. Similar to the other publications, he asserts that executive S&OP is first and foremost a decision-making process.

The planning processes and governing S&OP meetings described in these publications have been widely implemented across the world, supported by Wave 1 and Wave 2 planning technology. These technologies focused on transactions, planning, and insights, but were never built for automated planning, decision making, and execution. Many of today’s IBP processes are still rooted in this prior generation of planning concepts, reflecting a notable absence of progress, especially considering that supply-chain executives expect to see autonomous supply chains by 2025 (Steinberg, 2019).

Autonomous supply chains, where decisions and actions will largely be made by machines rather than by humans, cannot be realized by Wave 1 and Wave 2 systems as these systems are aimed at automating processes rather than decisions. To become autonomous, supply chains require the new technology of Wave 3 planning systems, which we think of as systems of intelligence

LIMITATIONS OF TRADITIONAL IBP

As IBP managers, we have facilitated well over a hundred IBP meetings and, as consultants, we have implemented IBP processes across many countries and companies. We acknowledge the value of IBP in support of an organization’s effort to deploy and execute its strategy (Van Hove, 2016). However, we’ve seen the shortcomings of these processes as well, including reliance on old technology.

While IBP comes in many shapes and forms, it is based on a few foundational concepts.

• Cross-functional, human decision making. IBP seeks to align key stake[1]holders from multiple functions on “a single version of the truth”; that is, a common understanding of matters that need to be addressed and the collaboration needed in decision making.
• Periodic planning cycles. Most common is the weekly Sales & Operations Execution (S&OE) cycle to address immediate operational issues, and a monthly cycle for medium- to long[1]term issues. This dichotomy facilitates responsiveness in short-term planning while freeing senior management to focus on high-impact decisions over the longer-term horizon (and only by exception on operational issues).
• Sequential process steps. Both the weekly and monthly cycles follow a strict cadence of sequential meetings and activities. The outcome of one step (for example, the Demand Review) is required input for the next step (Supply Review). An IBP team typically drives the process and strives to maintain adherence to it within the organization. While these general concepts are straight[1]forward, implementation can be challenging. Even after decades of experience, companies struggle with persistent shortcomings:
• Excessive focus on short-term issues. Despite weekly S&OE meetings for operational issues, IBP meetings still become distracted by acute short-term issues. And even though the planning is designed to encompass a rolling 24-month horizon, IBP discussions are heavily skewed toward the first few months.
• Information and process focus, rather than decisions focus. Many IBP meetings take on an “information sharing” character rather than a decision-making focus. The meetings should mark the moments in the month where we “synchronize the watches” in terms of demand and supply plans. Because IBP managers are incentivized to adhere to the process – follow the agenda, attendance, data availability and standardized templates – the time spent policing process compliance steals from the time devoted to high-value decision making.
• Limited attention to high-value decision making. In a traditional IBP cycle, there may not be adequate time to prepare advanced simulations and business continuity plans, or to seek cross-functional alignment in time for executive-level decision making. One of the key reasons is the excessive number of meetings.
• Excessive meetings. Typical IBP cycles span a month’s time, but this can stretch to six weeks because of pre[1]meetings in which we prepare for meetings. Planners are now committed to prepare for the pre-meeting and then replan for the real meeting, all while trying to keep stakeholders aligned. It is not uncommon for an IBP meeting to take four to eight hours.
• Inability to deal with disruptions. In IBP cycles that span many weeks, executives cannot respond quickly to market disruptions. COVID exposed the inability of companies to make rapid strategic choices, such as in days or weeks – impactful decisions such as closing a factory, entering or exiting a product category, or reallocating limited resources in their supply chain. Some companies actively bypassed IBP by installing executive-led COVID war rooms to more rapidly implement strategic decisions.
• Lacking insights. Meeting notes and actions might be published after every IBP meeting; however, actions and outcomes are often not properly recorded, not measurable, or not easily accessible. This omission limits continuous learning and restricts the creation of corporate insights around decisions. Was the plan the right plan and the decision the right decision under

the circumstances? Was the right action taken by the properly authorized person? The authors believe these shortcomings can largely be addressed by aligning the IBP process with Wave 3 planning technology.

MACHINE-CENTRIC VS HUMAN-CENTRIC DECISION MAKING

While IBP has become nearly synonymous with “the S&OP monthly cycle,” there really is no compelling justification for this monthly frequency. By automating aspects of the process, Wave 3 technology can decouple decision making from this arbitrary cadence, allowing planners to concentrate more fully on goal setting and oversight of policies and systems, while providing the knowledge augmentation for these human-centric decisions.

Planning Horizons

This new technology will support decision making in different planning horizons. In earlier Foresight articles (Van Hove, 2020, 2021), Niels distinguishes decision automation from knowledge augmentation and examines the relative desirability of these features across different planning horizons. Longer planning horizons, for example, require human-centric decisions, while shorter-term operational decisions are more amenable to automation.

Figure 3 summarizes the possible enhancements to IBP from Wave 3 technology. The key is to segment IBP along decision type and then differentiate between machine-based IBP, which runs under highly automated planning and decision making with human involvement only by exception, and human-centric IBP, which will benefit from decision augmentation and human-machine collaboration.

Figure 3. IBP Segmentation by Planning Horizon, Automation, and Augmentation

Machine-Centric IBP Decisions

As shown in Figure 3, machine-centric decisions will be well suited for automation of both Sales & Operations Execution (S&OE) and Operational IBP.

In the short-term horizon (0-3 months), operational decisions are frequent, repetitive, low value, and granular (e.g. at the SKU/location level). These include demand and supply balancing, inventory change, order purchase and allocation, stock transfer, and product pricing. Such decisions require limited human alignment and sign-off. Hence, they can be automated to sense change or disruption in the supply chain and respond to it. Humans will still set policies and rules to structure the automated process.

Operational IBP decisions (4-12 months ahead) are less frequent and time urgent than in the S&OE horizon, but still have low impact/value and apply at a detailed level so that planning and decision making can be automated as well. Figure 3. IBP Segmentation by Planning Horizon, Automation

Demand-planning tasks, including data gathering and cleansing, statistical/ML forecasting, and detection of variances to targets and budgets, can be actioned automatically with only limited human-machine collaboration required. Human input will be required to set goals and policies to help the machine optimize promotions, price settings, and phasing of new-product introduction to reach certain targets. Supply-planning processes in this horizon can be partly automated. Due to the longer decision horizon and higher uncertainty, supply-planning decisions become more probabilistic in nature, and so will be amenable to medium levels of automation and augmentation.

Based on demand input, optimized supply plans can be automated to run concurrently across an entire network and pro – vide planning outputs for distribution, replenishment, and production. Even changes to planning parameters such as lead times, safety stocks, capacities, and batch quantities can be automatically updated, and gaps to service levels or cost structures in the supply chain will be detected and actioned automatically.

Many operational decisions that might look complex can be solved through business rules, machine learning, and probabilities. For example, when planning to introduce a new product to the market, the system can calculate a probability of hitting the introduction date and so automatically update the phase-out planning of the predecessor product.

For both machine-centric IBP segments, while many decisions can be automated, decisions above a certain value or probabilistic threshold will require crossfunctional collaboration and sign-off. Yet cross-functional meetings can become more agile by acting upon exceptions suggested by the machine.

Human-Centric IBP Decisions

Planning decisions in this category address higher levels of aggregation (e.g. product families) and normally have high impact/value. Since these decisions are more complex, they require human alignment and sign-off and so are less amenable to automation. The role of the machine is to support the planner in decision making, resulting in human-machine collaboration.

The machine can support the planner with probabilistic simulations and what-if scenarios, network or price optimization, multisourcing, new-product development, and innovation updates. It will detect gaps in revenue, margin, or cost versus targets and budgets automatically and provide recommendations for gaps closure. These recommendations will be actioned functionally for the most part, as pre-agreed policies and functional tradeoffs have been incorporated in the recommendation. In this way, IBP will morph into an aspect of business as usual rather than a distinct and dogmatic process.

At the strategic level, decisions are complex, infrequent, and high in granularity, as well as in value/impact on the business. They can also be cultural and value-based, requiring human alignment and sign-off at the executive level. These decisions are too complex and important to be automated, and they likely require human capabilities that the machine doesn’t possess. The human-centric nature of strategic IBP decisions means that a greater emphasis should be placed on governance – that is alignment, decision rights, rewards, and culture (Sorenson, 2020) – instead of automation.

Machines, however, can develop recommendations for executives around strategic scenarios, mergers and acquisitions, network risks assessments, geopolitical war games, category changes, onshoring versus offshoring, and large CAPEX in – vestments, thus providing probabilities and financial impacts.

A NEW SET OF IBP CONCEPTS AND ASSUMPTIONS

Segmented by decision type as is Figure 3 and supported by new Wave 3 technology, the new IBP will improve a firm’s ability to address many traditional IBP challenges and create structures that are far more aligned with current times. These are summarized in the table below:

To start the transition to this new type of IBP, we need to establish a fresh IBP mindset, supported by new aspirations and assumptions. We suggest replacing the foundational concepts discussed earlier by the following:

Data and Analytics

• IBP will automatically gather and cleanse relevant internal and external data and distribute these across the business in one common data layer, near real time. This will permit sales to change prices and demand forecasts up to a certain threshold (say 25%) w/o consulting finance or operations.
• It will automatically provide descriptive and diagnostic analytics and make these available at any time throughout the business.
• Planners will guide the machine with policies, goals, and targets.
• Planning will take place continuously and require human input only upon matters that exceed certain impact or complexity thresholds.
• The machine will identify variations and gaps to plan and automatically action these up to a defined threshold. Above that threshold it provides recommendations to be decided upon by humans.

Process & Meetings

• The frequency and duration of IBP meetings will be driven by decision requirements, not process requirements.
• IBP teams will be incentivized to provide strategic business scenarios and improve decision making, not to police process compliance.

Decisions & Execution

• IBP decisions and impacts will be recorded digitally, applied to self-learning, and accessible to all IBP stakeholders.
• Such decisions will be executed automatically where possible, as all con[1]textual information available will be stored.
• Human adjustments made to the system-generated recommendations will benefit from feedback, reducing the impact of human biases.

For a company to transform from a traditional planning process to one segmented by human and machine decision making can be quite a journey. Changes will be required to operating models and systems, roles and organizational structure, rewards, and incentives. Additionally, planner capabilities will need to adjust to collaboration with the machine. Still, it can be done.

During COVID, the global CPG giant Unilever compressed its planning cycles from four weeks to one week, then to three days. It now combines human and machine aspects in its organizational structure with machine reporting to a human. It has clearly defined when the human is in the loop, on the loop, or out of the loop in decision making. Unilever’s approach may pave the path to the new norm for IBP.

The traditional IBP process and supporting Waves 1 and 2 planning technologies are a generation old and incapable of effectively adapting to today’s challenges or taking advantage of innovations in technology. Long overdue is a reset of traditional processes to approach IBP from a decision perspective. Supported with today’s systems of intelligence, we can assess where the machine should automate decisions and where the human will guide the machine and lead in decision making. We can then integrate IBP into day-to-day business meetings, rather than maintain it as a separate planning process.

3 thoughts on “ Integrated Business Planning: A New Narrative for an Old Process ”

Neils, always good thoughts form you on such an important topic ! I think the challenge of synchronizing basic supply chain execution data between entities / enterprises / nodes must be addressed first before even simple S&OP plans can be effectively and reliably deployed. Decentralized network, secured, distributed data systems is a key answer to this long standing need as nearly all current ERP and supply chain data only collects and stores deep water wells of independent data with no capability and worse yet INTEREST in connecting. The interesting phenomenon we have experienced with clients ( helping big and small companies with S&OP / synchronize their supply chains) is once the data is reliably and when in place so many great decisions can be made quite simply with the human mind and instincts. We believe greatly in power of human instinct, decision making and statistics and that machines are not decades but hundreds of years behind even a solid human trained in basic finance and production planning concepts. Here is a very basic concept of a 2×2 matrix explaining collaboration. A concept have been using for 30 years but recently reintroduced by Gartner. It is the different place different time intersection that is so badly need in supply chain tech. We have suffered through 15 years of IT distraction that “cloud” automatically address this need and it does not at all. It is the decentralized network, secured, decentralized distributed database capability that enables this business to business collaboration and then breaking S&OP free to the masses ! https://soptime.wordpress.com/2021/09/02/collaboration-framework-for-supply-chain-synchronization/ Keep up all the great work ! Maybe we can work together on a few projects soon !

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Business Strategies that set FMCG giant “Unilever” a class apart

The first name that comes to mind as soon as somebody talks about the FMCG industry is Unilever. A century ago no one would have predicted that a company founded by a margarine owner and a soapmaker would years later become one of the most established and famous companies and one of the most desirable employers in the world .

As of 2020, it has a turnover of around €50.724 billion and has approximately 155,000 employees worldwide. Apart from financially doing well, it has also progressed towards achieving sustainable development goals. Unilever is one of the few companies which have achieved gender equality in the workplace (as of 2020).

Transformation of a merged operation to a renowned brand

Unilever was established in September 1929 by merger of Dutch-based company Margarine Unie and British soapmaker Lever Brothers. The name Unilever came up by blending the names of both the companies. It has emerged as one of the largest consumer brands owning around 400 brands. It is primarily known for its diversification and has three main divisions. 

1) Food and Refreshments

2) Home Care

3) Beauty and Personal Care

It was only in the late 20th century; the organization increasingly diversified from making oils and fats products to expanding its operations worldwide. It has made numerous corporate acquisitions with brands like Dove, Omo, Knorr, Lipton, Lux, Magnum, Rexona/Degree, Sunsilk, etc. 

We're proud to say our brands are known for being widely used around the world. Check out some of our leading products: https://t.co/xRZwMakuFM pic.twitter.com/d91MmjipCw — Unilever Global Careers (@CareersUnilever) January 5, 2018

Unilever is famously known for its U-Shaped logo. It was only in 2004 that the current logo was established, which was designed by Wolff Olins. The current logo is made up of 25 icons which represents an aspect of the company. 

View this post on Instagram A post shared by Unilever Global #StaySafe (@unilever)

Unilever’s Marketing Strategy: A brand with a purpose

One of the best business strategies used by Unilever is that it integrates its global strategies with the local community to attract consumers who are attracted to the products that are famous worldwide; however, it can hold on to its local essence.

For example, Hindustan Unilever, a subsidiary of Unilever in India, has established itself as one of the most loved brands by the Indian audience. For decades it has been one of the top five most valuable companies in India . The reason for the success of HUL in the Indian market is its association with middle-class values and old-fashioned essence. Although it has been changing with time simultaneously, HUL’s philosophy has remained rooted in the purpose and values of the consumers.

While promoting these brands, Unilever also focuses on achieving the upper hand in communication to the audience without compromising these brands’ delivery.

For instance, the Surf Excel tagline has been ‘dirt is good and has portrayed it in various forms. At the same time, the case of Brooke Bond Red Label depicted how a social conversation over a cup of tea (or perhaps just a sip) could bring a change in the social views of the tea lover. Therefore, due to such creative methods, Unilever’s brands, despite being one of the oldests, have continued to gain consumers’ confidence.

Unilever: A company that keeps sustainability at the heart of its business strategy

As of 2020, Unilever celebrated 10 years of the Sustainable Living Plan . The company had committed to providing sustainable living for 8 billion people worldwide and decided to address social inequality and climate changes. The company did not neglect these goals despite the occurrence of COVID-19. 

Unilever worked on the longer-term implications of global trends for its business. Thus, the adoption of the Sustainable Living Plan has been a game-changer. It understood the importance of Sustainability and accepted it as a cultural transformation journey by integrating the USLP targets into its core working practices and procedures.

At the corporate level, Unilever has been committed to gender equality for a long time. As of 2020, 50% of managerial positions are held by women as compared 2010 to 38%. The organization had set a goal in 2010 to have a 50/50 split in the employment and added a women-leadership program . It collected, reviewed, and analyzed the data for the past 10-years and used it to battle gender stereotypes every month.

Unilever focuses on eliminating inequality at the global level by removing stereotypes in its advertising and showing how fathers or husbands could contribute to society 

Even during COVID-19 for 3-months, it did not stop working on its sustainable development plan and gender equality. It stated that organizations measuring inequality now would be better positioned to improve business and equality post-Covid. It made progress slowly over the years and was one of the few companies to achieve a balance. In 2020 Unilever won the ‘Catalyst Award’ for achieving gender equality 

As of 2021…..Unilever is using sustainability as an opportunity…

Unilever has been honored as being the most environmentally responsible companies and topped the list back in 2017.

In its latest goals, Unilever further added that it would reduce food waste from the factory to the shelf by half by 2025, which is five years earlier than what the organization has committed as part of the 10x20x30 (i.e 200 companies pledge to reduce wastage by 2030) initiative. It further added to increase the plant-based sales to around 1 billion euros ($1.2 billion) by the next 5-7years to reduce greenhouse gas emissions from traditional animal-based agriculture.

Unilever : Building a customer-centric business strategy

The organization has a competitive advantage due to its continuously enhancing values amongst consumers globally. Furthermore, it possesses a diversified portfolio of the top brands, thus achieving a unique position and innovating with the consumers’ preferences globally.

It has also taken up initiatives in its Research and Development, which are heavily funded to align with changing consumer needs. It has its R&D operations in China, India, UK, the US, and the Netherlands. Due to its manufacturing facilities in around 270 locations globally, Unilever has been able to cut costs and achieve expertise in its distribution channels.

Unilever has been able to establish itself as the most significant FMCG due to its direct-to-consumer business model, i.e. by extensively understanding the needs of the consumers. Unilever also started its marketing campaign by forming a relationship between the consumer and the brand.

The most crucial element in the business strategy of Unilever is the R&D in its product development, while being on par with its marketing activities. Unilever understood changing needs of the consumers and implemented them in their development. In 2017 alone, Unilever invested more than 900 million euros in its R&D. 

It’s not easy to be a market leader for a century and that too by winning the hearts of its consumers. With its dedicated sustainable yet customer-centric business strategy, Unilever would continue to do so.

-AMAZONPOLLY-ONLYWORDS-START-

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Kashish M is an Undergraduate student from the Middle East. Apart from listening songs and learning new languages and exploring different culture over time she developed interests in writing and gained interest in exploring different parts of the accounting/finance world.

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A better way to drive your business

Managing the availability of supply to meet volatile demand has never been easy. Even before the unprecedented challenges created by the COVID-19 pandemic and the war in Ukraine, synchronizing supply and demand was a perennial struggle for most businesses. In a survey of 54 senior executives, only about one in four believed that the processes of their companies balanced cross-functional trade-offs effectively or facilitated decision making to help the P&L of the full business.

That’s not because of a lack of effort. Most companies have made strides to strengthen their planning capabilities in recent years. Many have replaced their processes for sales and operations planning (S&OP) with the more sophisticated approach of integrated business planning (IBP), which shows great promise, a conclusion based on an in-depth view of the processes used by many leading companies around the world (see sidebar “Understanding IBP”). Assessments of more than 170 companies, collected over five years, provide insights into the value created by IBP implementations that work well—and the reasons many IBP implementations don’t.

Understanding IBP

Integrated business planning is a powerful process that could become central to how a company runs its business. It is one generation beyond sales and operations planning. Three essential differentiators add up to a unique business-steering capability:

• Full business scope. Beyond balancing sales and operations planning, integrated business planning (IBP) synchronizes all of a company’s mid- and long-term plans, including the management of revenues, product pipelines and portfolios, strategic projects and capital investments, inventory policies and deployment, procurement strategies, and joint capacity plans with external partners. It does this in all relevant parts of the organization, from the site level through regions and business units and often up to a corporate-level plan for the full business.
• Risk management, alongside strategy and performance reviews. Best-practice IBP uses scenario planning to drive decisions. In every stage of the process, there are varying degrees of confidence about how the future will play out—how much revenue is reasonably certain as a result of consistent consumption patterns, how much additional demand might emerge if certain events happen, and how much unusual or extreme occurrences might affect that additional demand. These layers are assessed against business targets, and options for mitigating actions and potential gap closures are evaluated and chosen.
• Real-time financials. To ensure consistency between volume-based planning and financial projections (that is, value-based planning), IBP promotes strong links between operational and financial planning. This helps to eliminate surprises that may otherwise become apparent only in quarterly or year-end reviews.

An effective IBP process consists of five essential building blocks: a business-backed design; high-quality process management, including inputs and outputs; accountability and performance management; the effective use of data, analytics, and technology; and specialized organizational roles and capabilities (Exhibit 1). Our research finds that mature IBP processes can significantly improve coordination and reduce the number of surprises. Compared with companies that lack a well-functioning IBP process, the average mature IBP practitioner realizes one or two additional percentage points in EBIT. Service levels are five to 20 percentage points higher. Freight costs and capital intensity are 10 to 15 percent lower—and customer delivery penalties and missed sales are 40 to 50 percent lower. IBP technology and process discipline can also make planners 10 to 20 percent more productive.

When IBP processes are set up correctly, they help companies to make and execute plans and to monitor, simulate, and adapt their strategic assumptions and choices to succeed in their markets. However, leaders must treat IBP not just as a planning-process upgrade but also as a company-wide business initiative (see sidebar “IBP in action” for a best-in-class example).

IBP in action

One global manufacturer set up its integrated business planning (IBP) system as the sole way it ran its entire business, creating a standardized, integrated process for strategic, tactical, and operational planning. Although the company had previously had a sales and operations planning (S&OP) process, it had been owned and led solely by the supply chain function. Beyond S&OP, the sales function forecast demand in aggregate dollar value at the category level and over short time horizons. Finance did its own projections of the quarterly P&L, and data from day-by-day execution fed back into S&OP only at the start of a new monthly cycle.

The CEO endorsed a new way of running regional P&Ls and rolling up plans to the global level. The company designed its IBP process so that all regional general managers owned the regional IBP by sponsoring the integrated decision cycles (following a global design) and by ensuring functional ownership of the decision meetings. At the global level, the COO served as tiebreaker whenever decisions—such as procurement strategies for global commodities, investments in new facilities for global product launches, or the reconfiguration of a product’s supply chain—cut across regional interests.

To enable IBP to deliver its impact, the company conducted a structured process assessment to evaluate the maturity of all inputs into IBP. It then set out to redesign, in detail, its processes for planning demand and supply, inventory strategies, parametrization, and target setting, so that IBP would work with best-practice inputs. To encourage collaboration, leaders also started to redefine the performance management system so that it included clear accountability for not only the metrics that each function controlled but also shared metrics. Finally, digital dashboards were developed to track and monitor the realization of benefits for individual functions, regional leaders, and the global IBP team.

A critical component of the IBP rollout was creating a company-wide awareness of its benefits and the leaders’ expectations for the quality of managers’ contributions and decision-making discipline. To educate and show commitment from the CEO down, this information was rolled out in a campaign of town halls and media communications to all employees. The company also set up a formal capability-building program for the leaders and participants in the IBP decision cycle.

Rolled out in every region, the new training helps people learn how to run an effective IBP cycle, to recognize the signs of good process management, and to internalize decision authority, thresholds, and escalation paths. Within a few months, the new process, led by a confident and motivated leadership team, enabled closer company-wide collaboration during tumultuous market conditions. That offset price inflation for materials (which adversely affected peers) and maintained the company’s EBITDA performance.

Our research shows that these high-maturity IBP examples are in the minority. In practice, few companies use the IBP process to support effective decision making (Exhibit 2). For two-thirds of the organizations in our data set, IBP meetings are periodic business reviews rather than an integral part of the continuous cycle of decisions and adjustments needed to keep organizations aligned with their strategic and tactical goals. Some companies delegate IBP to junior staff. The frequency of meetings averages one a month. That can make these processes especially ineffective—lacking either the senior-level participation for making consequential strategic decisions or the frequency for timely operational reactions.

Finally, most companies struggle to turn their plans into effective actions: critical metrics and responsibilities are not aligned across functions, so it’s hard to steer the business in a collaborative way. Who is responsible for the accuracy of forecasts? What steps will be taken to improve it? How about adherence to the plan? Are functions incentivized to hold excess inventory? Less than 10 percent of all companies have a performance management system that encourages the right behavior across the organization.

By contrast, at the most effective organizations, IBP meetings are all about decisions and their impact on the P&L—an impact enabled by focused metrics and incentives for collaboration. Relevant inputs (data, insights, and decision scenarios) are diligently prepared and syndicated before meetings to help decision makers make the right choices quickly and effectively. These companies support IBP by managing their short-term planning decisions prescriptively, specifying thresholds to distinguish changes immediately integrated into existing plans from day-to-day noise. Within such boundaries, real-time daily decisions are made in accordance with the objectives of the entire business, not siloed frontline functions. This responsive execution is tightly linked with the IBP process, so that the fact base is always up-to-date for the next planning iteration.

A better plan for IBP

In our experience, integrated business planning can help a business succeed in a sustainable way if three conditions are met. First, the process must be designed for the P&L owner, not individual functions in the business. Second, processes are built for purpose, not from generic best-practice templates. Finally, the people involved in the process have the authority, skills, and confidence to make relevant, consequential decisions.

Design for the P&L owner

IBP gives leaders a systematic opportunity to unlock P&L performance by coordinating strategies and tactics across traditional business functions. This doesn’t mean that IBP won’t function as a business review process, but it is more effective when focused on decisions in the interest of the whole business. An IBP process designed to help P&L owners make effective decisions as they run the company creates requirements different from those of a process owned by individual functions, such as supply chain or manufacturing.

One fundamental requirement is senior-level participation from all stakeholder functions and business areas, so that decisions can be made in every meeting. The design of the IBP cycle, including preparatory work preceding decision-making meetings, should help leaders make general decisions or resolve minor issues outside of formal milestone meetings. It should also focus the attention of P&L leaders on the most important and pressing issues. These goals can be achieved with disciplined approaches to evaluating the impact of decisions and with financial thresholds that determine what is brought to the attention of the P&L leader.

The aggregated output of the IBP process would be a full, risk-evaluated business plan covering a midterm planning horizon. This plan then becomes the only accepted and executed plan across the organization. The objective isn’t a single hard number. It is an accepted, unified view of which new products will come online and when, and how they will affect the performance of the overall portfolio. The plan will also take into account the variabilities and uncertainties of the business: demand expectations, how the company will respond to supply constraints, and so on. Layered risks and opportunities and aligned actions across stakeholders indicate how to execute the plan.

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Trade-offs arising from risks and opportunities in realizing revenues, margins, or cost objectives are determined by the P&L owner at the level where those trade-offs arise—local for local, global for global. To make this possible, data visible in real time and support for decision making in meetings are essential. This approach works best in companies with strong data governance processes and tools, which increase confidence in the objectivity of the IBP process and support for implementing the resulting decisions. In addition, senior leaders can demonstrate their commitment to the value and the standards of IBP by participating in the process, sponsoring capability-building efforts for the teams that contribute inputs to the IBP, and owning decisions and outcomes.

Fit-for-purpose process design and frequency

To make IBP a value-adding capability, the business will probably need to redesign its planning processes from a clean sheet.

First, clean sheeting IBP means that it should be considered and designed from the decision maker’s perspective. What information does a P&L owner need to make a decision on a given topic? What possible scenarios should that leader consider, and what would be their monetary and nonmonetary impact? The IBP process can standardize this information—for example, by summarizing it in templates so that the responsible parties know, up front, which data, analytics, and impact information to provide.

Second, essential inputs into IBP determine its quality. These inputs include consistency in the way planners use data, methods, and systems to make accurate forecasts, manage constraints, simulate scenarios, and close the loop from planning to the production shopfloor by optimizing schedules, monitoring adherence, and using incentives to manufacture according to plan.

Determining the frequency of the IBP cycle, and its timely integration with tactical execution processes, would also be part of this redesign. Big items—such as capacity investments and divestments, new-product introductions, and line extensions—should be reviewed regularly. Monthly reviews are typical, but a quarterly cadence may also be appropriate in situations with less frequent changes. Weekly iterations then optimize the plan in response to confirmed orders, short-term capacity constraints, or other unpredictable events. The bidirectional link between planning and execution must be strong, and investments in technology may be required to better connect them, so that they use the same data repository and have continuous-feedback loops.

Authorize consequential decision making

Finally, every IBP process step needs autonomous decision making for the problems in its scope, as well as a clear path to escalate, if necessary. The design of the process must therefore include decision-type authority, decision thresholds, and escalation paths. Capability-building interventions should support teams to ensure disciplined and effective decision making—and that means enforcing participation discipline, as well. The failure of a few key stakeholders to prioritize participation can undermine the whole process.

Decision-making autonomy is also relevant for short-term planning and execution. Success in tactical execution depends on how early a problem is identified and how quickly and effectively it is resolved. A good execution framework includes, for example, a classification of possible events, along with resolution guidelines based on root cause methodology. It should also specify the thresholds, in scope and scale of impact, for operational decision making and the escalation path if those thresholds are met.

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In addition to guidelines for decision making, the cross-functional team in charge of executing the plan needs autonomy to decide on a course of action for events outside the original plan, as well as the authority to see those actions implemented. Clear integration points between tactical execution and the IBP process protect the latter’s focus on midterm decision making and help tactical teams execute in response to immediate market needs.

An opportunity, but no ‘silver bullet’

With all the elements described above, IBP has a solid foundation to create value for a business. But IBP is no silver bullet. To achieve a top-performing supply chain combining timely and complete customer service with optimal cost and capital expenditures, companies also need mature planning and fulfillment processes using advanced systems and tools. That would include robust planning discipline and a collaboration culture covering all time horizons with appropriate processes while integrating commercial, planning, manufacturing, logistics, and sourcing organizations at all relevant levels.

As more companies implement advanced planning systems and nerve centers , the typical monthly IBP frequency might no longer be appropriate. Some companies may need to spend more time on short-term execution by increasing the frequency of planning and replanning. Others may be able to retain a quarterly IBP process, along with a robust autonomous-planning or exception engine. Already, advanced planning systems not only direct the valuable time of experts to the most critical demand and supply imbalances but also aggregate and disaggregate large volumes of data on the back end. These targeted reactions are part of a critical learning mechanism for the supply chain.

Over time, with root cause analyses and cross-functional collaboration on systemic fixes, the supply chain’s nerve center can get smarter at executing plans, separating noise from real issues, and proactively managing deviations. All this can eventually shorten IBP cycles, without the risk of overreacting to noise, and give P&L owners real-time transparency into how their decisions might affect performance.

P&L owners thinking about upgrading their S&OP or IBP processes can’t rely on textbook checklists. Instead, they can assume leadership of IBP and help their organizations turn strategies and plans into effective actions. To do so, they must sponsor IBP as a cross-functional driver of business decisions, fed by thoughtfully designed processes and aligned decision rights, as well as a performance management and capability-building system that encourages the right behavior and learning mechanisms across the organization. As integrated planning matures, supported by appropriate technology and maturing supply chain–management practices, it could shorten decision times and accelerate its impact on the business.

Elena Dumitrescu is a senior knowledge expert in McKinsey’s Toronto office, Matt Jochim is a partner in the London office, and Ali Sankur is a senior expert and associate partner in the Chicago office, where Ketan Shah is a partner.

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Unilever's End-to-End Sustainability Push: Hitting all elements of the supply chain…

Unilever’s Corporate Sustainability Report came out in the last month, and was received with great fanfare.  Some of the highlights identified in the first year of its Sustainable Living Plan released to  media and partners at events in the UK, Netherlands, India, US and Brazil include:

• 24% of agricultural raw materials are now being sourced sustainably, versus 14% in 2010
• Over 90% of Unilever’s leading spreads now contain less than one-third saturated fat
• Renewable energy now contributes 20% of total energy use
• Pureit has given 35 million people access to safe drinking water

But this isn’t enough.  Unilever’s supply chain team has higher ambitions, and is beginning to drive sustainable thinking as an integrated business strategy across multiple tiers in the supply chain, across all five elements of the SCOR framework:  DESIGN, SOURCE, MAKE, DELIVER, PLAN, and SELL.

Paul Polman, Unilever’s CEO, is seeking to make sustainability a core part of the overall Unilever business strategy and vision.  He has created a challenge to the business to double their volume, and maintain the current carbon footprint, which is impacting every single workstream in each value chain.  This is part of the PLAN element, that sets targets and objectives for every business in terms of sustainable products.

There are many challenges that occurred during this transformation, as executives discovered several attributes associated with the carbon footprint of their products, associated with the SELL part of the supply chain.  One big insight is that 68% of the carbon footprint impact is NOT in the supply chain – it is during the consumer use process – and disposal use process.  For example, if a bag of tea has 100 points of sustainability impact- 68% of those points are from boiling water for tea, with only 40% from factories, and trucks delivering it.  So how do you get consumers to act differently, and how do you reduce that?  Now think about their other products used by consumers and their carbon impact:  shampoo, soap, conditioner, toothpaste, etc.

How do you get people to reduce the amount of heated water and water they use when they take a shower, and how to convince consumers to take colder and shorter showers? These are the types of questions their product designers in groups at Unilever are struggling with in DESIGN.  For example, how do we get faster rinsing products in laundry, and laundry liquids that lower temperatures in your washing machine?  Chemical engineers and product producers are working to identify solutions to these issues.

Of course, Unilever has many other efforts that are not just in product design and consumer use.  For example, in the MAKE sector, they are using less materials, and are working on supply chain metrics in their factories to reduce their energy used, and have even developed  “cookie cutter” factories that with LED lighting and energy-efficient processes and waste disposition elements that can be used anywhere in the world.  They have cut 600,000 tones of CO2, and 20% of energy is from renewable energy, with zero waste in 1/3 of their sites.

On the SOURCE side, procurement has done a huge amount of work in tea sourcing, through their Rainforest Alliance project to help meet goals for rain forest team in Kenya.  Over 50% of tea in Lipton brand tea is Rainforest Alliance certified, and 1/4 of agricultural products are sustainably sourced.  For palm oil, they have turned out suppliers who do not use sustainable harvesting processes, and in this case have turned around a number of growers who suddenly realized how serious Unilever was in their intent.  Same goes for cartons, where sustainable metrics have moved the needle to 60% sustainable content in cartons.

In DELIVER, Unilever is continuing to optimize their supply chain network, on top of efficient transportation planning.  They regularly consult suppliers as they move production closer to customers, not just in North America, and Europe, but in emerging countries.  And as they do so, they continue to emphasis labor and human rights requirements with close monitoring of labor conditions and hiring practices.  As a result, they are not always the lowest cost supply chain, but certainly the most sustainable.

And that means a lot to consumer in this day and age.

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Unilever’s relentless commitment to s-curve transformations.

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Unilever's Global Headquarters in London.

Unilever is consistently rated a company with one of the best supply chains in the world. They are also one of the world’s best in terms of succeeding at integrating digital technology into all areas of business . Much of this success is related to their relentless commitment to S-Curve programs. Unilever is rather unique in applying S-curves to their ongoing digital transformation.

Unilever (NYSE: UL) is one of the world's largest consumer goods companies. The company had revenues of over €60 billion in their last fiscal year. The company has over 400 brands, including 14 that had a turnover of more than €1 billion. These include such well-known brands as Dove, Vaseline, Hellman’s and Ben & Jerry’s.

Such a large company, they have over 127,000 employees globally, clearly has a massive supply chain. This multinational operates 280 factories and 500 warehouses, that source raw materials from 52,000 suppliers in over 150 countries, processes 25 million customer orders annually, that are then shipped to customers in over 190 nations.

S-Curves and Digital Transformation

An S-curve encompasses the idea that progress on some dimension starts slow, at some starts to accelerate, and then that progress slows again once a certain level of maturity is reached. S-curves have been applied to product development, returns from an IT project, a new manufacturing process, and other business activities as well. Unilever has somewhat uniquely applied the idea to global transformations. Once the results from a transformation begin to slow, it is time to kick off a new transformation. This is a culture of continuous improvement writ large.

S-curve benefits start slow, accelerate, then taper off.

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The latest transformation goes by the name “Compass.” Part of this transformation is focused on a move away from an increasingly complex matrix structure to a more agile model based around five Business Groups - Nutrition, Personal Care, Home Care, Beauty & Well Being, and Ice Cream. The goals of the new Compass Organization include growing sustainably while achieving top tier shareholder return, becoming a more transparent business, and unlocking agility through a new digitally enabled organization. This involves an investment of hundreds of millions of Euros.

Simon Smith, the vice president of customer experience and integrated operations deployment, said this is Unilever’s largest transformation in 15 years. He went on to explain that there is a significant supply chain component to the transformation. Providing one face to the customer required better order management, improved master data, and a new supply chain planning (SCP) solution from Kinaxis. In the past, Mr. Smith explained different business groups were using different planning solutions. Now, the company has standardized on Kinaxis’s AI enabled RapidResponse solution.

It was believed a SCP transformation would reduce inventory, improve service and free up cash flow. The savings from SCP would be used to fuel Unilever’s aggressive growth plan.

To have a successful implementation required dealing with a complex IT infrastructure. Unilever has over 20 ERP platforms that the new SCP solution needed data from. The supply chain data from different systems was pulled into a newly created data lake, which than is used by the SCP system for planning. There was an aggressive master data management program to ensure that the data to be used for planning was clean.

Unilever started in North America in 2020. The initial implementation covered 550 users and 120,000 stock keeping units. The experience from North America allowed the company to create a global standard template for planning. North America represented the first of the new regional hubs for planning. Today, there are about 1,500 Kinaxis users across 6 hubs covering 130,000 stock keeping units. In mid-June, Unilever went live across several hubs in one day. Kinaxis is now being used across businesses that represent 80% of Unilever’s turnover.

The Results

The results have been good. There was a reduction in operational costs of 20 basis points, a 15% improvement in planner productivity and a 5% reduction in working capital. Almost one day of inventory has been cut from days of inventory outstanding. Even as inventory levels have decreased, service levels for constrained inventory increased from about 70% to over 90%.

The results will get better as Unilever climbs the S-curve. Mr. Smith estimates they are about two thirds of the way up the SCP curve. “We have about another year to run before we run out of steam. We are just starting to think about our next S-curve.” Mr. Smith believes they are well positioned for the next S-curve because of the data lake they created as part of the planning implementation.

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How Unilever Went From Soap Manufacturer To Multinational Giant

Table of contents, here’s what you’ll learn from unilever’s strategy study:.

• How to make the most out of the opportunities you meet.
• How to be proactive with market changes and thrive by adapting quickly.
• How product innovation becomes the source of competitive advantage.
• How strengths like in-depth knowledge of specific markets become powerful expanding factors.
• How to grow by taking advantage of unparalleled localization.
• How growth opportunities are revealed by empowering your management.
• How sustainability can be used as a brand lever.

With over 2.5 billion people consuming its products on any given day, it’s difficult to find any corner of the world where Unilever has not reached.

What started as one soap brand has now become one of the world’s largest consumer brand conglomerates, spreading into beauty and personal care, home care, and food and refreshments.

Unilever's market share and key statistics:

• Staggering turnover of €52.4 billion in 2021
• Portfolio of 400+ brands, 13 of which feature in Kantar Worldpanel Global Top 50
• 14 brands with a $1 billion turnover
• Over 53,000 supplier partners
• Number of employees worldwide: 148,000
• Owning  280 factories, 270 offices and 450 logistics warehouses globally
• A reach spanning over 190 countries

From innovative strategies and impeccable management to effective marketing and commitment to sustainability, there are several reasons behind the success of this multi-industry giant.

In this study, we analyze them closely to highlight how Unilever has been able to continuously expand its horizons over the years and across countries as well as continents, gaining a competitive edge while growing exponentially.

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Humble beginnings: How did Unilever start?

Although it wasn't until 1929 that the company we now instantly recognize as Unilever was formed, its story goes way back to the late 19th Century.

In fact, it is set in two different countries simultaneously, with two major companies operating in seemingly different industries coming together and setting the foundation of Unilever.

In many ways, it can be said that it set the tone for what sort of brand Unilever was going to be in the coming years.

More than just soap

William Hesketh Lever began his career in the 1880s as a salesman in his family's grocery business. At the time, The Long Depression was still affecting the global economy, and many companies were struggling to survive.

Amidst the chaos, Lever saw an opportunity to step into the manufacturing of soap, which he believed had great potential for growth.

Thus, in the 1890s, as the founder of Lever Brothers, William Lever penned his ideas for Sunlight Soap: "to make cleanliness commonplace; to lessen work for women; to foster health and contribute to personal attractiveness, that life may be more enjoyable and rewarding for the people who use our products."

Mission and vision statements were hardly a thing during the Victorian era. Yet, Lever was well ahead of his time. They envisioned changing attitudes towards hygiene and personal care in the UK and solve customers’ problems simultaneously.

Soon, the company was not only making waves in the British Isles, but also began expanding its reach in many parts of Europe, North America, Australia, and South Africa.

The first bar of Sunlight Soap was in 1884

Diversifying operations

In the early 1900s, much of Britain's consumption of butter and margarine was sourced from Dutch and Danish companies. However, with the threat of WWI and trade coming to a standstill, the British government asked Lever to produce margarine as well.

Recognizing that the required raw materials, including oils and fats, were quite similar for soaps and margarine, William Lever welcomed the opportunity with open hands.

From there on, Lever became more than a soap company as it took its first step towards forming a multi-brand legacy that would inspire and lead the world of consumer brands for the next century and probably, beyond.

A manufacturing company through and through

Not only did Lever plan to manufacture its products, but it also extended its operations to produce its raw materials itself.

From mills to crush seeds for vegetable oil to whole transportation and packaging operations, Lever became a well-established vertically integrated company, taking giant strides to redefine the consumer goods industry.

The Dutch side of things

Before Lever Brothers had set foot in the margarine industry, there was already intense competition in the Dutch market.

To see off new entrants exporting their products at lower prices and to make the most of the global economic situation, two Dutch giants Jurgens and Van den Bergh joined hands in 1908.

A few years later, in 1920, these two companies combined with Schitt and established their operations in the Netherlands as Margarine Unie NV and in England as Margarine Union Limited.

This put them in direct competition with the Lever Brothers and what ensued was a tussle of giants for most of the following decade. 

Putting Uni and Lever together

Both the Dutch and English companies knew they would benefit from synergies if they came together rather than going head-to-head in the soap and margarine industries.

Thus, after two years of discussions, they merged in 1929 to form Unilever, which was owned by two holding companies, Unilever Limited and Unilever NV, with setups in both countries.

The structures for the holding companies were identical, and the profit-sharing was on an equal basis.

This merger allowed the company to foray into multiple industries and establish dominance with its hold on manufacturing operations.

Key takeaway 1: cash In on opportunities

With the amalgamation of two companies – Lever Brothers and Margarine Unie – Unilever was formed.

From Lever entering an utterly new soap manufacturing business to competitors Jurgens and Van den Bergh combining, there are countless examples of the founders of Unilever realizing an opportunity and being quick to grab it. 

Navigating The Great Depression – Initial Challenges

Unilever was still in its early years when the Great Depression struck, and the company was riddled with challenges on all fronts.

Its products’ prices plummeted 30% to 40% within the first year while at the same time butter came forward as an even cheaper alternative, further lowering the demand for margarine. The company’s agricultural products, such as cattle cake, also took a major hit and its retail grocery and fish shops saw a major decline in revenues.

Things did not look too bright for the company that had already shown so much promise and growth. However, just as William Lever had come out of the Long Depression as a successful business, Unilever responded proactively to this crisis too.

Responding to the challenge

The 1930s saw fresh faces managing the operations at Unilever with Francis D'Arcy Cooper at the helm of affairs.

This new management’s initial response to the Great Depression was to form a special committee that would oversee the firm’s operations in both Netherlands and UK. It also supervised two further committees; one that would handle the company’s business in Europe and one for other regions.

These actions helped the company mitigate the immediate effects of the recession and lay the groundwork for further changes.

Restructuring & redistributing assets

Initially, the Dutch group contributed two-thirds of Unilever's total profits while the British side accounted for the remaining. However, owing to trade conflicts in Europe, similar to those preceding WW1, the equation was reversed, and the British group's contribution increased.

Therefore, in 1937, Cooper convinced the company’s boards that it was time for restructuring, and Unilever needed to align itself with its original goal of equal profit sharing. As part of this dynamic shift, one significant action was selling the Lever Brothers Company in the United States and other Lever Brothers' assets outside Britain to Unilever's Dutch group.

This allowed the two factions to operate with nearly equal profit volumes and assets and overcome the trade challenges.

Key takeaway 2: proactively adapt to the situation

Had Unilever not set up the special committee and undergone the changes it did in the 1930s, it is possible it would not have survived the Great Depression. But with pro-activeness and resilience, it was able to tackle the challenges successfully and come out on the other side stronger than before.

Growth Through Localization & Innovation

Following the years of the Great Depression and WWII, the world’s economic landscape completely transformed. At that point in time, Unilever was establishing itself in various countries and needed a strategy to localize its products, marketing efforts, and management.

It realized that growth in new markets now was not limited to or even dependent on increasing production capacities or lining up products. It needed to have a strong footing in research and development to keep up with changing consumer preferences and increasing competition.

This meant that the company had to make some much-needed changes in its approach and it did just that.

Heading into new markets

Unilever was growing and expanding its operations into many new countries and diverse communities. This meant more local challenges wherever it set up operations. However, much of the management was still under the control of Dutch and English representatives of the parent companies.

Undoubtedly, the people from the parent head offices were capable managers and had contributed to the company's growth, but the challenge here was different. Markets such as India, Brazil, or even the USA did not function in the same way as European Markets.

Customers had different preferences, supply chains were unique, and external influencing factors, such as laws and regulations, were also always specific to the respective regions. Therefore, Unilever's management needed local players who could understand what was required in their region and develop effective strategies to achieve it. 

Hence, in the 1940s, Unilever started a localization policy referred to as 'ization.’ The Dutch and English representatives were recalled, and local positions were handed over to local executives.

It began to be implemented as early on as 1942, with the company’s Indian subsidiary going through the process of Indianization. Australianization, Brazilianization, and more followed it. These centers had greater autonomy in decision-making and marketing, which enabled the company to penetrate further into these new markets and localize its products.

Unilever continued with this localized, decentralized management system throughout WWII and several years following. However, they did encourage Unileverization, sharing a common mission across their various subsidiaries during this time, and took it up more rigorously later on.

Embracing research & innovation

The embracing of research did not occur before facing a few setbacks. For instance, the market for soap, Unilever’s main product, revolved around color, scent, and application on fabrics. This changed when in the 1950s, their competitor in the US Market, Proctor & Gamble, introduced Tide. This nonsoap synthetic detergent powder was far superior and solved many plumbing problems caused by insoluble soaps.

For some years, Unilever remained behind its competitors until it found a way to solve the shortcomings of new detergent.

Tide was formed from petrochemicals, and its residues in sewerage systems and rivers were causing major problems. Now, Unilever had the chance to explore chemical technology and retain its position in the market. By 1965, they had launched their very own biodegradable version of the product.

It wasn’t just soap where Unilever invested in research. The company also established 11 research centers, including laboratories, all around the world to come up with innovative solutions for food preservation, health, and animal care. That was going to define the company as one that looked ahead into the future and relied on improving itself to remain at the top.

Another significant example of Unilever's constant innovation can be seen in its margarine. When butter was short in supply, margarine became a convenient alternative – one of the reasons why the Lever Brothers started manufacturing it in the first place. However, butter soon became available widely again, and that too at lower prices. Now, there was not much that made margarine an enticing option to customers.

Unilever's laboratory in Vlaardingen was tasked to find a way to improve the quality of margarine and make it stand out, whether through better nutrition, flavor, or convenience. The solution came in the form of enhanced refining of soybean oil, a key raw material in margarine production. 

Benefiting from tariff lift

A major boost to Unilever's operations was the formation of the European Economic Community and its efforts to make Europe a common market in the 1950s and 1960s.

Previously, Unilever has based its factories and production in various European countries to avoid tariff restrictions. It was, however, an inconvenient solution. Not only did they have to bear additional costs of production in expensive locations, but such a spread-out production system posed the challenges of supply, logistics, capacity, and more.

Through the common market, there was no need to restrict themselves anymore. Unilever now took its production to wherever costs could be minimized, and operations could be consolidated. Thus, they were able to produce in greater quantities and accelerate their processes.

Key takeaway 3: innovate & solve

Unilever's growth in 1940 to 1960s had a lot to do with improving their products and their management system to cater to modern problems. This helped them stay ahead of the competition and keep their production up-to-date and cost-effective all the while delighting customers.

Expansion & Acquisitions Till The 1990s

As a well-known multi-industry firm, Unilever was no stranger to acquisitions and takeovers. They expanded in the US Market in 1937 by adding the tea manufacturer Thomas J. Lipton Company to their portfolio. Later on, in 1944, they also entered the toothpaste industry by acquiring Pepsodent.

In the post-WWII era, they continued to take over larger firms like Birds Eye, a UK frozen foods company, in 1957. By 1961, they had also taken control of US ice cream producer, Good Humor. 

Unilever acquires Birds Eye parent company T. J. Lipton in 1943

However, these were only gradual acquisitions that allowed them to explore new product lines. From the 1980s, Unilever's approach took an aggressive turn, and they set their eyes on bringing many more brands under their banner.

The shopping spree of the 80s

Unilever’s targets changed in the 1980s. They wanted to expand but with a plan to strengthen their hold in industries in which they had resources and expertise and the market had a lucrative potential for growth. This meant they were sticking to foods, detergents, toiletries, etc. but were ready to eliminate the competition.

Thus, they began by selling off their ancillary business and services, such as transporting, packaging, and initiating their acquisitions. In 1984, Unilever oversaw a hostile takeover of the British tea company Brooke Bond for £376 million. The company complemented Unilever’s Lipton in the USA, and now, the road was clear for further growth.

One of Unilever’s biggest acquisitions was of Chesebrough-Pond in 1986. The company owned some very high-potential and popular products in the USA like Vaseline Intensive Care and Pond's Cold Cream. Moreover, with over $3 billion in annual sales, it was the perfect chance to cement itself in the personal product business internationally.

Another major market that the company dominated with its acquisitions in the late 1980s was the perfume and cosmetic industry. It simultaneously became the owner of Shering-Plough's perfume business in Europe, Calvin Klein in the US, and Fabergé Inc. The latter was bought for $1.55 billion and handed Chloe, Lagerfeld, and Fendi perfumes to Unilever.

Now, the company was a force to reckon with, if not the leader in its primary industries and in the markets it predicted would generate the most gains.

The global giant

Unilever clearly showed its aggressive intent in the 1980s, and they were not going to stop in the 1990s.

By 1992, the conglomerate consisted of over 500 businesses in 75 countries. In the mid-1990s, they went on to acquire over 100 more companies. From buying personal care giant Helene Curtis for $770 million to sweeping the US ice cream market by buying Philip Morris's Kraft General Foods’ division for $215 million, there was no shortage of the treasure chest Unilever had.

By 1999, they had grown from 500 businesses to 1600 brands. But this brought them back to where they started the extensive series of acquisitions, with many companies that didn't have the potential to grow or simply didn't fall in with Unilever's strengths.

It was time for a major strategy shift and to go back to the basics. Out of 1600 brands, 400 were generating 90% of the revenue. Unilever decided to let go of the remaining 1200 and put all its efforts into strengthening its already powerful brands.

This has been their path ever since and one that has enabled them to maintain their position as one of the top consumer products companies in the world.

Toppling competitors

Along with buying their competitors, Unilever did not stop introducing new products into the market. In 1984, their product Whisk overtook P & G’s Cheer in the US laundry detergent market.

Two years later, Whisk was introduced in Britain, along with Breeze, a soap powder the company had only seen of in Surf. Unsurprisingly, Unilever recorded a 50% growth in operating profits for detergent products while it also experienced increasing returns in the food industry.

This multi-pronged strategy of introducing new products and acquiring ones with potential did not allow Unilever to capitalize fully on the market's potential for growth and left little room for competitors to adjust.

Standing out from the competition

From Lever Brothers and Margarine Unie taking on their rivals head-on to Unilever PLC establishing its unique identity despite battling against giants P&G and Nestle, the company has always embraced healthy competition.

One of the main reasons Unilever has been so successful in standing out is its expansion in over 190 countries through products they specialize in and dominate in. Moreover, it hands significant decision-making power to local managers to strengthen their position in diverse markets. Both P&G and Nestle have not been able to grow as much in terms of reach.

Another, key aspect that differentiates Unilever is its emphasis on and funding towards Research & Development. They continue to improve their products and adapt to changing consumer needs by providing enhanced solutions.

Last but not least, Unilever’s sustainable plans set them apart from major competitors, whereby they show their commitment to the collective betterment of people and societies.

Key takeaway 4: stick to your strengths

Unilever’s origins lay in soap and margarine – industries they knew very well and had the potential to grow in. They expanded their portfolio but stuck to their strengths and, as a result, grew exponentially.

Changing Product Groups With Evolving Markets

Throughout the nearly 100 years of Unilever, they have acquired and sold brands and expanded their reach into many territories. Naturally, they experiment with product groups and divisions to decide which suits their goals best and when.

At times, their product groups have had a significant influence on their strategies, whereas at other times, they were merely playing advisory roles. But whatever the situation, Unilever has kept an eye on how operations and revenues were affected and carefully reorganized their groups accordingly.

Understanding complex markets

There is no one fixed way to distribute product groups. Sometimes, they require to focus on research and distribution while emphasizing localization from time to time. For instance, the food industry, from which many of Unilever's top brands belong, undergoes changes every few years. It can be categorized into three regional groups.

Firstly, the global fast-food category. Fried chicken, burgers, soft drinks, etc., are famous worldwide, from Asia to Europe and beyond. The core products remain the same, and the tastes do not differ greatly.

The next category is international foods. These are products that belong to one country but are also popular in other countries as well—for example, Chinese, Indian, and Italian foods.

Hence, the third category leads to national foods – those that represent and are popular in their country of origin. For Unilever's base region, the UK, pies, puddings, steaks, etc., are considered national foods.

Now, that is only one way to look at food markets. Another method or problem, as you may call it, is that a product may not even be defined or preferred the same way in different regions.

For example, take something as simple as tea - a globally consumed product. The British like their tea hot and with milk; Americans prefer it iced; Middle Easterners drop the milk and add sugar.

Therefore, Unilever cannot keep its product groups fixed or stringent and must recognize where it can churn out the most profits.

Giving more autonomy to product groups

Until the 1960s, Unilever's localization policy played a major role in its decisions and actions. Product groups served advisory or assisting roles with little power. That was how to company was progressing, and there was no need for change.

Carrying on the example of food products, during and post-WWII, raw material sourcing was a crucial factor in the production of Unilever foods. But then, when the 60s came, and firms, along with Unilever, started to invest in research, the dynamic shifted towards preservation technology and logistics.

Gradually, the power of determining revenues was handed to product groups, and local managers took a backseat. A pivotal change made in the new structure was introducing three separate food units: edible fats, frozen foods and ice cream, and a general food and drinks group.

These groups proved fruitful and helped the company expand in the European and North American markets. 

Rising consumer awareness

The 1970s was the time the marketing arena transformed. With every brand wanting to stand out, they popularized concepts, such as healthy eating and natural ingredients.

The surge in demand for low-calorie foods was also a result of effective marketing. The challenge for Unilever was that all three of its food groups contained low-calorie products. It came in the way of their progress and dented their profits.

But how could they form a system that resolved this problem and kept local managers and product groups intact?

Unilever formed a committee called “Food Executive” consisting of three directors. Its role was to control all food products instead of leaving it to specific groups or managers.

Now, there are 5 product groups:  edible fats, meals and meal components, beverages, ice cream, and professional markets. They play an essential role as advisors (more valued than in the 1960s) but are not responsible for profits.

Simultaneously, local managers are allowed to oversee the regional needs and preferences of consumers.

Key takeaway 5: balancing decentralization and product groups

Managers and product groups are both vital components of a multinational firm. To ensure their products satisfy consumers’ wants, Unilever continues to come up with ways to combine the two productively.

Unilever Strategy - Management Dynamics Over The Years

One of the key factors that have fueled Unilever's growth ever since 1929 is its evolving management dynamics that have allowed the company to stay true to its roots while adapting to the local areas it operates in. 

Think globally. Act locally!

Think globally and act locally has been at the heart of Unilever's operations and enabled it to make a mark in even the most far-flung areas successfully. As a result of trial and error, Unilever's management dynamics over the years showcase the company's drive to excel, innovate, learn, and get the job done. 

Let's delve deep into the management dynamics to better understand the growth of the company. 

Given that both the parent companies of Unilever had a tradition of scaling their business through export as well as local production that British and Dutch expatriates mostly ran, it comes as no surprise that Unilever, too, had the same management style initially. British and Dutch executives ran the show, at least for the first decade. However, in the early 1940s, Unilever began changing things by hiring local managers to lead the operations in respective parts of the world, as already highlighted in Chapter 3.

The localization and decentralization began with the subsidiary in India in 1942. Key roles were given to Indian managers, who were also provided with the freedom and flexibility to run operations on their own with little involvement from the head office on a day-to-day basis. 

This process of localization of management, in addition to the growing competition as well as the alienation of the subsidiaries during World War 2, led to decentralization, with each subsidiary becoming a self-reliant and self-sufficient unit. 

This is where the senior management decided that while decentralization has indeed paid off, it would be in the company's best interest to guard against too much of it. Hence, to ensure that the Unilever culture, vision, and mission were shared among all subsidiaries, Unileverization was promoted. 

It has now become a long-standing practice at Unilever to regularly train managers from around the world, be it at a Unilever Four Acres facility or hired facilities in local areas, to ensure that Unilever's values are ingrained and followed everywhere.

The Unilever management matrix, which mainly consists of local talent and initiative with centralized control, is empowered to think transnationally. From nurturing local talent to cross-posting managers worldwide so that they can gain diverse experiences, better understand the Unilever culture, and establish unity, an array of practices are followed. 

Break communication barriers

Given the sheer size and scale of Unilever around the globe, effective communication across borders is an essential need for it. It doesn’t come as a surprise that the most relevant and used language for all forms of communication is English.

Hence, Unilever actively looks for employees with fluency in the English language when hiring and regularly invests to develop the English language as well as communication skills in general for its employees through various training programs. 

Pick the cream of the crop

Alone you can only go so far; together the sky is the limit with what you can achieve. Unilever takes it a step further by hiring the best as well as the brightest and then unifying them to achieve remarkable results. 

While it comes as no surprise that Unilever pays huge emphasis on onboarding the right people, the way how it goes about the process of recruitment offers a lesson to other businesses. Right from the mid-twentieth century, Unilever has continued to pioneer employee section systems.

From getting involved in universities to spot talent early on to sponsoring an extensive range of business courses, Unilever has done it all. Plus, trainees – as part of a group – are offered on-job experiences and courses at training facilities, allowing Unilever to create a holistic network of individuals whose informal experiences act as a glue that drives the company.

In addition to this, the vast system of attachments that allow employees to work on temporary assignments and projects in different parts of the world further grooms them offers them exposure and provides the 'know-how' of how Unilever functions. This empowers them and helps them further the unique Unilever way of working wherever they go next. 

The company's formal structure, together with the informal exchanges leads to the transfer of ideas, enhances communication, and fosters collaboration, which in turn, boosts innovation and helps solve problems, allowing Unilever to continue to grow. 

Modern workforce and workplace

Being resourceful is the new corporate approach of Unilever, which accounts for a number of organizational changes to prepare for the future, including:

• Tapping the open talent economy to boost the workforce whenever needed
• Harnessing the power of digital to drive business growth
• Being more creative and thinking out of the box to achieve goals
• Creating a better work-life balance and work environment

One example of Unilever’s unique approach to setting itself up for success in the future and unlocking its capacity to grow is its “YourFreelo” program in which internal resources of the company are offered holistic support through freelancers with different perspectives and handy skills.

Iterative improvements thanks to trial & error

From the outside, it may appear that it is Unilever's transnational strategy that has helped pave its way to success. While that wouldn’t be wrong to conclude but if we delve deep, we can find that it’s the messier revolution brought to the fore by continuous trial and error that has driven the company.

Hiring and training managers and leaders carefully, as well as linking decentralized units with a common culture, are the primary reasons behind the company's growth. That being said, the company has cautiously treated the path of an informal transnational network, realizing that it can elevate risks and lead to complacency.

To guard against it, the company continues to shake up the system every now and then, shifts roles, and responsibilities and evolves in the dynamic business world where change is the only certainty. By rethinking, reviewing, and reforming the strategies, the company manages to tackle the tricky waters and win.

Key takeaway 6: Develop bold middle-management

One of the major reasons behind the success and growth of Unilever has been its management, which doesn’t shy away from taking bold steps when needed. In addition to this, Unilever continues to invest in human capital and experiment as well as explore to stay a step ahead in the ever-evolving dynamic age.

Sustainable Living Plan – The Game-Changer For Business Growth

Seldom do businesses as large as Unilever get a chance to re-invent themselves and throw caution to the winds by taking the difficult long-term approach that can even negatively impact their bottom line.

In 2010, Unilever did just that by launching the Unilever Sustainable Living Plan (USLP), pioneering a new business model. 

Playing their part in the environment

At the core of the plan lies Unilever's commitment to doing right by people and the planet with its purpose-driven ambition of halving its environmental footprint while doubling its size and making the world a better place for 8 billion people.

Fighting climate change by ending deforestation, ensuring food security by championing sustainable agriculture, and investing in water, safety, and hygiene to uplift people's lives, Unilever set the bar higher than ever before.

Has Unilever been successful in achieving its targets? You bet it has.

By pushing the company in a unique way, further than ever before, in its quest to build a sustainable and equitable future, Unilever has delighted all stakeholders, appealed to the masses, and showed how companies can lead from the front by taking a stand at issues that matter.

Following are some of the highlights of the USLP more than ten years after its launch depicting how Unilever has made an explicit positive contribution to address the key challenges:

• Reached over 1.2 billion worldwide with health and hygiene programs
• Lowered the environmental footprint per customer by one-thirds
• Reduced greenhouse gas emissions by two-thirds
• Achieved 100% renewable grid electricity across all plants
• Achieved zero landfills across all factories
• Cut down on over €1 billion on costs by reducing waste and enhancing energy as well as water efficiency

"Brands with purpose grow; companies with purpose last; and people with purpose thrive."

Embedding sustainability into the business has yielded remarkable results for Unilever.

Unilever's purpose-led brands have contributed immensely to Unilever's growth in a day and age where sustainability has become mainstream as around two-thirds of consumers opt for a particular brand because of its stand on social issues, and more than 90% of millennials prefer brands that strive to elevate humanity. 

According to Unilever , its purpose-driven brands contribute to almost 75% of the company's growth and are growing 69% faster than the rest of the business, depicting that the huge bet has indeed paid off. 

While Unilever could have easily waited for consumers and governments worldwide to push it to embrace sustainability rather than do it all by itself – that too ahead of the time – it portrayed itself as the leader with the focus on the bigger picture which stands by its values and is not afraid to do the right thing even when the odds are stacked against it.

Key takeaway 7: Make sustainability part of your business strategy

Pioneering sustainability businesses, Unilever started a movement for social change in 2010 that helped it re-invent itself for good. It has paid off for the company, making customers fall head over heels for their brands.

Why is Unilever so successful?

Unilever is always in transition, equipping itself to continue making a difference well into the future. It isn’t perfect given its fair share of products that don’t seem sustainable or advertising campaigns that don’t go hand in hand with its values. However, it is a company on a big mission to transform the world, setting an example for the rest to follow.

Performance beyond expectations In challenging & uncertain circumstances

The year 2020 was volatile and unpredictable in ways more than one for all businesses operating around the globe. From supply chain bottlenecks to change in the way consumers shop and employees work, there were an array of disruptions, leading to an uncertain business environment.

Yet, in the face of such adversity, Unilever has stayed true to the values that have always made it a force to be reckoned with – resilience and agility – and hence, not only survived but also thrived. 

While underlying operating profit fell by 5.8% in 2020, the company experienced a boost in underlying sales growth of 1.9%. This can be mainly attributed to the company’s long-term planning, flexibility, and sustainable objectives.

Hence, where other companies focused on driving growth temporarily, Unilever developed their current and future strategies on sustainability and inclusiveness for growth. An example is their stronghold in emerging economies of China, India, and the USA, where they have always looked to include locals and contribute to society’s uplift.

Moreover, Unilever went ahead with a major shift in its legal structure in 2020 to stabilize and unify its operations worldwide. Formerly run by cross-border companies, Unilever NV and Unilever PLC, Unilever has consolidated itself into the single umbrella of Unilever PLC, becoming stronger than ever.

Below is a graph of Unilever's annual revenue in Euro Millions

Growth by the numbers

List of key strategic takeaways

• Impact-driven Businesses Succeed

Now more than ever, it has become difficult for companies to achieve a competitive advantage. So, what can a business do? Be relevant to society and offer a multi-stakeholder return, benefiting all and crafting real change. It definitely pays off.

• Always Be Proactive and Flexible

Change is the only certainty, so you need to embrace it. Your best bet is to be on the lookout for potential opportunities that present themselves from time to time and grab them with both hands. You can do that if you remain agile and act quickly.

• Prioritize Investing In Human Capital

Your single most important asset is your people. Empower them so that they can help you elevate your brand. Right from hiring the ‘right’ people to nurturing them, you need to continuously invest in human capital in order to achieve lasting success.

• Take Risks To Grow

You can only reach the top with iterative improvements made possible by continuous innovation and risk-taking. Keep experimenting, testing, and exploring: if you achieve the desired result, you win, if you don’t, you learn.

• Encourage Sustainable Living And Make It Effortless

Weave sustainability into your processes and value chains. From the raw material used to the packaging, make sure you use eco-friendly practices to add value to the lives of people. This way you can win consumer goodwill and trust.

• Stay Intune With The DNA Of Your Brand

In the quest to do more and become more, you can easily forget to stay true to your ultimate purpose. Go back to the drawing board whenever needed, regularly communicate your purpose to your target audience, and stand up for what you stand for to separate yourself from the rest.

Unilever’s journey from one soap brand with a handful of sales and customers to the leading multinational consumer goods company with billions of consumers worldwide has been incredible and offers a number of lessons, including:

While we don’t know what the future holds, we are pretty much certain that Unilever is here to stay and dominate, doing right by the people and planet.

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6 ways Unilever has achieved success through sustainability - and how your business can too

Submitted by Sally Uren on Wed, 23/11/2011 - 07:30

A year ago this week, Unilever launched its Sustainable Living Plan (USLP), one of the most ambitious strategies that a global company has ever embarked on. Pioneering a bold new business model, the company pledged to double in size at the same time as halving its environmental footprint, setting out to achieve a series of concrete targets by 2020.

One year on, the company that touches 2 billion people a day with products that range from Persil to Marmite - announces strong financial results that outperformed their competitors, despite the recession. Could sustainability be the secret of Unilever’s recent success?

For us at Forum for the Future, the symmetry between commercial success and bold targets isn’t a coincidence, but demonstrates that a sustainable business is a successful business. Paul Polman, Unilever’s CEO, is also unsurprisingly of this view. Back in July, I interviewed Unilever’s dynamic CEO to get his views on sustainability, and how he sees the Unilever Sustainable Living Plan as a key driver of success for Unilever. I’ve drawn on this interview, and Forum’s wider work with other pioneering businesses, to suggest 6 steps for businesses to take to succeed through sustainability.

1. Ask the right question – from my world to our world

Unilever has not just asked – ‘how can I be sustainable?’ Critically, in drawing up the USLP, their main question was, how could business contribute towards a sustainable future. In Paul Polman’s words,

“Most businesses operate and say how can I use society and the environment to be successful? We are saying the opposite – how can we contribute to the society and the environment to be successful?”

For me, this is the difference between the standard business case for sustainability – doing the right thing if it is profitable, and the leadership business case - making the right thing profitable. This distinction is crucial, as it shows that a business has considered the profound implications of big sustainability challenges on the business, and has a plan to respond to these challenges in a way that works for the business and the world around it. Unilever, and others, recognise the interdependence of a business and the system around it.

So, the first step towards succeeding with sustainability is to ask the right question. Not how can I make my business sustainable, but how can I make our world sustainable?

2. Think long term

It is perfectly possible, today, to be commercially successful and think short-term. Many businesses are in this camp – fuelled by a fascination with short-term profit maximisation. But this short-termism means that businesses are missing out on an opportunity to build resilience into the business, and secure its medium and long-term success. What happens to the business model when oil reaches $300 a barrel, when stringent legislation comes crashing onto the statute books to secure dwindling supplies of natural resources, from water to wood. If a business hasn’t thought about the impact of these long-term trends, some of them very certain in their nature, then its ability to deliver long-term value creation is seriously compromised.

Unilever has worked through the longer term implications of global trends for its business. The USLP targets are responses to these implications and are designed to ensure that Unilever is in business next year, and into the next decade.

3. Accept that no business is an island - create new networks

Unilever is clear that it can’t deliver a sustainable future on its own. Paul Polman is consistently clear on this, “the issues that we are facing, issues of food security climate change obviously are issues that cannot be solved at the level that they have been created; we really need a step change…companies like ours…need to work with multiple stakeholders”.

Unilever has long recognised the importance of partnerships, from helping establish the Marine Stewardship Council in 1997 to working with the Rainforest Alliance; to certify the tea it sells across multiple geographies, Unilever has pro-actively engaged with others to accelerate progress towards sustainability.

The trick for any business is to be clear where collaboration is necessary, and possible, and where space can be left for a bit of healthy competition. What is clear, is that in an increasingly complex, and resource-constrained world, leading businesses need to be willing to collaborate much more willingly, and create new networks to deliver new solutions to old problems.

4. Embed sustainability into the business – accept this is a journey of cultural transformation

Unilever has also started to translate and embed the USLP targets into its core working practices and procedures. Across the business, Unilever has also started to provide its people with the tools, skills and knowledge to be able to deliver the USLP. Crucially, the influential ‘Categories’, that own and innovate the brands, were involved in developing the overall USLP targets and now have their own specific targets and scorecard for tracking progress against the USLP. The USLP is also giving the business renewed purpose and enthusiasm. In Paul Polman’s words, “it also gives a tremendous purpose to what we are doing as a business that creates an enormous energy here and employee engagement that I’m sure will explains half of the growth that we will be producing” .

This all sounds really obvious stuff, but too many businesses think that the production of a cutting-edge strategy is enough, its employees will suddenly intuit the change in direction, and work out for themselves what they need to do differently. Or, possibly worse, organisations set about telling everyone everything about the new sustainability targets, leaving a trail of confusion and inaction.

Step 4, then, is about embedding sustainability thoughtfully and appropriately in the business, and understanding that this will take time, and in the end is about changing the culture.

5. Don’t wait for the pull – push sustainability out to consumers

A common barrier to progress towards mainstreaming sustainability is deciding to wait until consumers demand more sustainable products and services. Paul Polman, quite rightly, has decided not to wait, and sees taking sustainability pro-actively to the millions of people that buy Unilever products as a real priority. And he thinks this is the right time, “but they are ready for it I can tell you, increasingly so, and it’s no longer a developed market phenomena - it’s rapidly becoming a global phenomenon…We are basically trying to turn this company over to the consumer at the end of the day.”

Trends such as ever-increasing consumer demand for transparency, as well as resource scarcity, mean that sustainability will be mainstreamed in the next few years (see the finding’s from Unilever, Sainsbury’s and Forum for the Future’s recent Consumer Futures study). So, step 5, taking sustainability to your customers, today, will also secure success tomorrow.

6. Change the system

Finally, Unilever realises that it can only so far on its own before it reaches the constraints of the unsustainable systems in which it operates. As any leading business knows full well, a common barrier to progress can be the mainstream investment community, who are still struggling to reward sustainability practices, and are too focused on the short-term. By dropping quarterly reporting, and yet still delivering commercial success, Unilever is trying to change the external system in a way that, in the end, will reward sustainability.

“I am on the record for saying I don’t really work for the shareholder I work for the consumer and the customer, but I firmly believe that in doing so we will have a business model that is successful and that will benefit the shareholder long term as well. It’s the only way; if I was only focused on the short term shareholder return I think I would undermine this business model.”

Paul Polman is clear, Unilever needs to influence and engage suppliers, consumers and legislators to create the conditions where a sustainable consumer goods industry is possible.

Step 6 is being willing to change the system, not accept the current barriers, but remove them.

Of course, Unilever isn’t perfect. There are still products in the portfolio which on the face of it, don’t seem that sustainable (Pot Noodle anyone?), there are still those advertising campaigns which do not appear to be promoting fairness and equality. But it is a business in transition, and a business with a big plan. And quite frankly, given the absence of coherent government action, and consumer ambivalence on sustainability, is one of the few positive forces out there right now for sustainability. Other big brands and businesses would do well to follow its lead.

Could businesses change the finance system? 

View other articles and insights from Forum for the Future

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Unilever: Strategic Planning, Budgeting and Forecasting

Business goals that will enhance long-term stakeholder value.

In 2012 we set our four strategic goals to be:

• Grow the Business: By 2020 our goal is to double sales by the business compared to 2010

• Improve Health and Wellbeing: By 2020 we will help more than a billion people take action to improve their health and wellbeing

• Reduce Environmental Impact: By 2030 our goal is to halve the environmental footprint from making and using of our products as we grow our business

• Enhance Livelihoods: By 2020 we will enhance the livelihoods of millions of people as we grow our business

Defining our purpose and our vision were key to setting our strategic goals. We believe profitable growth should also be responsible growth. That approach lies at the heart of the development of our strategic goals.

In developing our goals there were a number of priorities that were important to us:

• Customer and consumer trust

• A strong business for shareholders

• A better, healthier and more confident future for children

• A better future for the planet

• A better future for farming and farmers

We developed our goals as a path towards achieving our vision, incorporating these priorities through a process of actively engaging with governments, intergovernmental organizations, regulators, customers, suppliers, investors, civil society organizations, academics and our consumers. The detail on how we intend to deliver our goals is captured in the Unilever Sustainable Living Plan. It guides our approach to how we do business and how we meet the growing consumer demand for brands that act responsibly in a world of finite resources. Our Plan is distinctive in three ways:

1. It spans our entire portfolio of brands and all countries in which we sell our products.

2. It has a social and economic dimension: our products make a difference to health and wellbeing and our business supports the livelihoods of many people.

3. When it comes to the environment, we work across the whole value chain, from the sourcing of raw materials, to our factories and the way consumers use our products.

At Unilever, we have a simple but clear purpose – to make sustainable living commonplace. We believe this is the best long term way for our business to grow. Our purpose and operating expertise will help us to realize our vision of accelerating growth, reducing our environmental footprint and increasing our positive social impact. We recognize this is ambitious, but it is consistent with changing consumer attitudes and expectations. Our unswerving commitment to sustainable living is increasingly delivering:

• more trust from customers; and

• a strong business for shareholders, with lower risks and consistent, competitive and profitable long term growth.

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This Unilever case study has been taken from the A4S Essential Guide to Strategic Planning, Budgeting and Forecasting. 

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Integrated Business Planning: Is It a Hoax or Here to Stay?

Integrated Business Planning (IBP) is not new; it is just another name of a mature S&OP process. Comparing forecasts to the operating budget, aligning tactical plans to strategic plans, having a portfolio management process, and going over alternative scenarios for better decisions have always been the vital components of S&OP. The interest of businesses will be best served if vendors put their energy in improving the S&OP technology than in promoting it as a new and improved process technology. PATRICK BOWER | Mr. Bower is Senior Director, Corporate Planning & Customer Service at Combe Incorporated, producer of high quality personal care products. A frequent writer and speaker on supply chain subjects, he is a recognized demand planning and S&OP expert and a self-professed “S&OP geek. Prior to that, he was a Practice Manager of Supply Chain Planning at a boutique supply chain consulting firm, where his client list included Diageo, Bayer, Unilever, Glaxo Smith Kline, Pfizer, Foster Farms, Farley s and Sather, Cabot Industries, and American Girl. His experience also includes employment at Cadbury, Kraft Foods, Unisys, and Snapple. He also worked for the supply chain software ...

From Issue: Spring 2012 (Spring 2012)

By Jaime Marijuán Castro     March 23, 2023

Unifying integrated business planning: how does it work.

As stated in our previous blog post titled " Why Is Integrated Business Planning So Hard? ," we examine why unifying integrated business planning (IBP) or connected planning processes enables organizations to ensure they take a data-first approach to all planning activities . Such a planning approach aims to unify business strategy with planning, budgeting and forecasting activity for all business lines and functions – providing one version of the truth within a single, seamless technology platform and user experience.

A trusted, common view of the numbers provides a robust baseline for agile decision-making and keeps all teams together, collectively trying to achieve the same corporate objectives while staying focused on specific KPIs. In other words, the different teams maintain their independence while working in unison to achieve corporate success by leveraging the same trusted and governed data.

This approach is underpinned on a single technology platform that can manage planning, budgeting & forecasting (PB&F), consolidation and reporting all in one place – without the need to duplicate data or otherwise maintain different solutions. The advantages of this approach are many:

• Trust in the numbers . While every function plans at a different level of granularity, all can be tied back to financial metrics and strategic objectives because all functions are using the same data within the same platform.
• Leadership buy-in . Using one version of the numbers is pivotal to managing business performance. No substitute exists for a single accurate picture of plans and performance, so hardly any CEO and CFO would turn away from this advantage.
• Improved collaboration. One key aim of unifying business planning is to help reach consensus among all planning parties. When teams no longer need to collate and compare plans, collaboration flows and allows consensus planning to happen faster.
• Instant response to events . When the same data is used for forecasting and consolidation, actuals can be served to support shorter forecasting cycles (daily, hourly) and what-if simulations . In current volatile times, this capability offers a true competitive advantage.
• Faster IBP process implementation . If one of the IBP fundamentals is "one set of numbers," why not set it as the single most important requirement for any IBP process implementation? Having one single technology and data model is a unique way to obtain "one set of numbers." When this requirement is met first, the IBP process can deliver faster business integration, establish a superior planning structure and begin to model the right culture and behaviors.

Leading the Change

Intelligent Finance teams lead business planning unification and foster collaboration across the organization. While the teams oversee and facilitate the planning activity, doing so should not suppress the detailed planning required between and by the different business lines and functions (e.g. Supply Chain, HR, IT).

Instead, all planning activities should focus on a central Finance planning capability that orchestrates and aligns data, strategy, processes and people across the different business units and functions (see Figure 1). This central capability is simple to understand when the main mechanisms to show market value and performance against strategy goals are financial artifacts such as P&L, balance sheet, and income and cash statement.

Unfortunately, most options for connected planning, integrated business planning are simply not built for this purpose. Why? Rather than relying on a truly unified data model, Finance and IT teams are forced to connect plans across systems and spreadsheets by moving and reconciling data. Those processes, in turn, add material risk and cost to integrated business planning efforts.

In other words, true unification matters – a lot.

How to Unify Business Planning

Unified business planning is anchored on 3 key principles :

• Principle of collaboration . Team collaboration starts with adopting a clearly communicated vision, setting the expectations around teamwork, and defining KPIs aligned to strategic objectives and financial attainment. Finance should orchestrate and foster collaboration and support all teams. Ideally, a leadership role – one that reports to the CFO – should be established to orchestrate all planning activities.
• Principle of simplification . Simplification occurs as a result of process step elimination, minimization and automation. Planning processes should be challenged by removing complexity, redefining measurements and ultimately automating tasks. When a unique view of the plan is instilled, the need for file version control, data reconciliation and validation is drastically reduced or eliminated.
• Principle of technical unification . This principle is the single most important precept to follow in a unified business planning approach . Achieving technical unification calls for breaking away from suboptimal technology solutions and spreadsheet patching. Instead, such unification requires considering a solution capable of managing both financial and operational forecasting, planning and budgeting processes while providing financial consolidation, reporting and analytical tools all in one place – and doing it with speed and scale (see Figure 2). When a single solution is used to manage all these processes, bringing people together and simplifying the process becomes easier.

These principles not only provide a robust foundation throughout the IBP journey, but also facilitate the adoption of technology that truly unifies people and processes.

Unified Integrated Business Planning Model

A data-first approach to integrated business planning unifies the views of strategy, planning and performance, increasing the speed of decision-making.

Figure 3 shows the model for unified business planning platform. In light gray, the figure shows the key processes that must be part of the same platform under one data model to reap the benefits of this approach. The figure also displays a representation of an IBP process with a closed loop between planning and execution – a loop that remains aligned to the business strategy because everything relies on the same data and technology.

Unify Integrated Business Planning, or Face the Hidden Costs

Unifying integrated business planning brings data and people together, helps the organization model the right behaviors, and removes the friction of traditional technology silos and spreadsheets.

Today, Finance leaders have the organizational influence to lead an IBP process based on a unified approach. However, unifying integrated business planning requires one single platform and extensible data model, not an integrated set of connected modules from the same vendor. This approach offers the most effective way to unify business strategy, planning and performance.

By not taking a unified and data-first approach to IBP process implementation, organizations face the hidden costs of dealing with archaic and fragmented technology:

• Technical debt : Cost of maintaining outdated or obsolete technologies.
• Reduced efficiency : Costly mistakes derived from reconciliation and manual touch-points.
• Less effectiveness : Organizational friction and higher elapsed time between planning and execution.
• Higher risk, opportunity loss : Result of slow, biased decision-making.

Learn how to maximize the benefits of Integrated Business Planning in our next blog :

Read the Blog

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What's behind the major dairy business shake-ups of 2024?

13-Aug-2024 - Last updated on 15-Aug-2024 at 09:50 GMT

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It’s been a busy half-year for consolidations in the dairy industry. In March, Unilever, owner of ice cream brands Magnum and Ben & Jerry’s, announced the group’s plans to spin-off its entire ice cream division ​.

The strategic move, which would result in around 7,500 job losses, is hoped to be completed by 2025 in order to allow the consumer goods giant to focus on its four high-growth divisions of Beauty & Wellbeing, Personal Care, Home Care, and Nutrition. CEO Hein Schumacher said the spin-off – which is most likely to be a divestment – would allow the group to focus its resources ‘on global or scalable brands where we can apply our leading innovation…across complementary operating models’.

Meanwhile, Belgian dairy co-operative Milcobel announced it would sell its private-label ice cream division YSCO ​, citing the ‘fast-growing but highly-fragmented market’ as a key reason behind the decision. YSCO is a major player in the European private label ice cream market, producing and distributing nearly 200 million liters of ice cream per year and working closely with many major retailers on creating their own-brand ice cream products. Selling YSCO would fund additional capacity and process optimization across the co-op and likely have a positive effect on the milk price, according to Milcobel.

“While these are great businesses with recent strengthening in performance and potential for more, ownership…is not required to fulfil Fonterra’s core function of collecting, processing and selling milk,” said CEO Miles Hurrell. “Due t our co-operative structure, we believe prioritising our Ingredients and Foodservice channels and releasing capital in our Consumer and associated businesses would generate more value.”

The news came after years of consolidation activity from the New Zealand co-op, which offloaded its Chilean dairy business to Gloria Foods, divested from its loss-making Chinese dairy farms, and exited Dairy Partners America Brazil, a JV with Nestlé, now under the control of Lactalis Brasil.

So what is prompting this activity – and why is ice cream in the midst of it?

'Investors prefer certainty to volatility'

We reached out to Mark Lynch, Partner at Oghma Partners, a corporate finance consultancy with a focus on the food, beverage, and wider consumer industry and advises on acquisitions, divestments, strategy, and raising capital.

We asked what are the risks of divesting from an ice cream or consumer goods division - particularly where a globally-recognized brand portfolio forms part of it. Lynch said: “The risks around splitting a division like ice cream from the rest of a company can lie around economies of scale and future NPD opportunities.

“Whilst in theory splitting a division off allows focus on that division which hopefully drives higher sales growth, the spun-off business has to carry some of the central overhead which previously existed in the Group Co.

“So, by its nature such splits drive duplication. If there was too much ‘fat’ in the divested business and/or the central cost charge was overly and unnecessarily high, then this could offset – more than offset – the negative impact of spinning off.

“With regards to economies of scale, the spun off company and the original business will both be smaller – so their buying scale diminishes as can their presence and clout with the retailers. This could have a negative impact with regards to their negotiating position versus presence on the shelf.

“Finally, it is possible that there will be a loss at new product development level – where the Group has historically helped generate NPD activity.”

He added that a stable category may move into growth through innovation, resulting in lost growth opportunities for the company that has divested from that business.

“Ice cream has its challenges, as do other subsectors of the food industry; in part due to its seasonality, as a poor summer can lead to a poor set of results and investors prefer certainty to volatility.

“Food stocks in general have lost some of their allure as other more exciting growth sectors have claimed the limelight – this is likely to be more cyclical in nature and as tech stocks get overheated interest may return to the sector.” 

“Historically, the food sector has been of interest to private equity investors – as seen by the number of deals and we see ice cream as being part of where the interest lies,” he added.

Besides ice cream and consumer dairy, where in the food and beverage space is there scope for consolidation activity in the next 12 to 18 months? Lynch said: “We have already seen some consolidation in the meat-free space in the last year or two as the sector has struggled. However, I can see this continuing driven by cost related concerns.

“Elsewhere, there still seems scope for consolidation in the sports, healthy nutrition, and protein space, which remains in growth and where the market remains fragmented.”

How can food brands shield themselves from profit volatility?

Asked to highlight specific strategies that may help food and beverage companies to shield themselves from profit volatility, Lynch suggested there isn’t a magic bullet, but a set of tried and tested methods that companies can leverage.

“Historically, sector profitability has actually been fairly stable – the unusual Ukraine war-driven cost events are, fortunately an infrequent occurrence. 

"However, consolidation can drive profitability, as can automation, for example."

“On top of that market segmentation, premiumization – product driven strategies and NPD – can help lift profits over time,” he concluded.

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Unilever Global Change location

Implementing Growth Action Plan at pace

Published: 8 February 2024

Average read time: 18 minutes

Today, we announced our results for the full year 2023.

Statement from Hein Schumacher, CEO

“Today’s results show an improving financial performance, with the return to volume growth and margins rebuilding. However, our competitiveness remains disappointing and overall performance needs to improve. We are working to address this by improving our execution to unlock Unilever’s full potential.

“In October, we set out a Growth Action Plan focused on three priorities: delivering higher-quality growth, stepping up productivity and simplicity, and adopting a strong performance focus.

“The new leadership team has embedded the action plan at pace. We have increased investment behind our 30 Power Brands, accelerated portfolio transformation, and are driving a sharper performance focus with clear and stretching targets across the whole organisation.

“We are at the early stages of this work and there is much to do but we are moving with speed and urgency to transform Unilever into a consistently higher performing business.”

We expect underlying sales growth (USG) for 2024 to be within our multi-year range of 3% to 5%, with more balance between volume and price.

We anticipate a modest improvement in underlying operating margin for the full year. We will deliver this through gross margin expansion, driven by a step-up in productivity and net material inflation back to more normal levels.

Growth Action Plan update

In October 2023, we set out a Growth Action Plan to drive improved performance and competitiveness. During the fourth quarter, we moved at pace to embed it across the business.

The plan is divided into three elements but is underpinned by one simple premise: the need to do fewer things, better, with greater impact. The operational impacts will build throughout 2024.

Faster growth

1. Focus on 30 Power Brands : These gross margin accretive brands represented around 75% of Group turnover with underlying sales growth of 8.6% in 2023 and 6.5% in the fourth quarter. This is where we have concentrated our incremental brand and marketing investment, which will continue in 2024.

2. Drive unmissable brand superiority : We developed a new quantitative methodology to measure brands’ consumer appeal across multiple dimensions and have validated it in 29 strategic cells. During the first half of 2024, this will be rolled out across all 30 Power Brands in key geographies to identify performance gaps and improve competitiveness.

3. Scale multi-year innovation : We have identified multi-year, scalable innovation programmes to drive market development and premiumisation. The programmes at least double the average 2022 project size, with launches from 2025.

4. Increase brand investment and returns : In 2023, we reinvested more than half of our gross margin expansion into incremental brand and marketing investment, up 130bps to 14.3%. We will continue to step up investment in areas that drive impact and support improved competitiveness.

5. Selectively optimise the portfolio : We continue to reshape the portfolio, with the announced acquisitions of Yasso and K18 and the disposals of Elida Beauty, Dollar Shave Club and Suave.

Productivity & simplicity

6. Build back gross margin: We accelerated recovery in the second half of 2023 with a 330bps gross margin improvement, driving a 200bps improvement for the year to 42.2%. In 2024, a tight grip on costs, measured by improved net productivity, will fuel further gross margin expansion.

7. Focus our sustainability commitments: We are honing our sustainability efforts around four critical platforms: Climate, Plastic, Nature and Livelihoods. We have set exacting, short-term targets, to drive progress against our longer-term commitments.

8. Drive benefits of the organisation: The category-focused Business Groups are now fully implemented with end-to-end responsibility for strategy and performance. In 2024, this will enable sharper choices to accelerate growth and digitalisation.

Performance Culture

9. Renewed team : Since October, over half of our executive leadership team has changed. Our new leaders are addressing the 2024 opportunities and challenges with urgency and decisiveness.

We are announcing today that our Chief People & Transformation Officer Nitin Paranjpe has decided to retire from Unilever later this year. Nitin has had a distinguished 37-year career with Unilever, including as CEO of Hindustan Unilever, President Home Care, President Foods & Refreshment and Chief Operating Officer of Unilever. We are pleased to announce the appointment of Mairéad Nayager as our new Chief People Officer, effective 1 June. Mairéad is currently Chief Human Resources Officer (CHRO) of Haleon plc, having previously served as CHRO of Diageo plc between 2015 and 2022.

10. Drive and reward outperformance : We have implemented a new reward framework across the organisation with metrics more closely aligned to value creation. A new Directors' remuneration policy proposal has been extensively consulted on with our largest shareholders and will be voted on at the 2024 AGM.

Unilever overall performance

Underlying sales growth in the full year was 7.0%, with positive volumes of 0.2% and 6.8% from price. Growth from the 30 Power Brands was accretive at 8.6%. Beauty & Wellbeing and Personal Care delivered strong volume growth throughout the year and Home Care returned to positive volume growth in the second half. Volume growth for the Group accelerated to 1.8% in the fourth quarter, with 3.9% volume growth from the 30 Power Brands.

Underlying price growth decelerated from 10.7% in the first quarter to 2.8% in the fourth quarter, reflecting lower net material inflation in the second half. Nutrition and Ice Cream faced the highest input cost inflation in 2023 which translated into higher pricing.

The percentage of our business winning market share [a] on a rolling 12-month basis was disappointing at 37%. This poor performance reflects share losses to private label in Europe, consumer shifts to super-premium segments in North America where we currently under index and a significant reduction of unprofitable SKUs globally. Our competitiveness is not good enough and we are moving quickly to address it.

Beauty & Wellbeing grew underlying sales by 8.3%, with strong volume growth of 4.4%. Prestige Beauty and Health & Wellbeing continued to grow double-digit and now account for a quarter of Beauty & Wellbeing’s turnover.

Personal Care grew underlying sales 8.9%, with 3.2% from volume and 5.5% from price, led by strong sales growth of Deodorants.

Home Care grew underlying sales 5.9%, driven by 6.8% from price and -0.9% from volume, with positive volumes in emerging markets offset by a double-digit decline in Europe.

Nutrition grew underlying sales 7.7%, with 10.1% from price and volumes down -2.2% as we responded to higher input costs and a challenging European market.

Ice Cream’s underlying sales growth was disappointing at 2.3%, with price growth of 8.8% and a volume decline of -6.0%, reflecting the impact of downtrading in the in-home channels.

Emerging markets (58% of Group turnover) grew underlying sales 8.5%, with 1.6% from volume and 6.9% from price. Latin America, Turkey and Africa delivered double-digit growth. India grew mid-single digit led by volume, with lower input costs that led to negative pricing in the fourth quarter. Sales in China grew low-single digit led by volume while the market recovery continued to be uneven and slower than expected. Growth in South East Asia was impacted by a sales decline in Indonesia in the fourth quarter as consumers avoided the brands of multinational companies in response to the geopolitical situation in the Middle East.

Underlying sales in developed markets (42% of Group turnover) grew 4.8% in the full year with 6.7% from price and -1.8% from volume. North America delivered strong growth of 5.8% with 2.5% from volume and 3.3% from price, with continued double-digit underlying sales growth in Prestige Beauty and Health & Wellbeing. Volume growth in North America accelerated throughout the year leading to volume growth of 6.3% in the fourth quarter. In Europe, underlying sales growth was 4.1%, driven by 12.8% from price given its higher exposure to categories with significant cost inflation, and a volume decline of -7.7%.

Turnover was €59.6 billion, down -0.8% versus the prior year, including -5.7% adverse foreign exchange translation and -1.7% from disposals net of acquisitions. Underlying operating profit was €9.9 billion, up 2.6% versus the prior year. Underlying operating margin increased 60bps to 16.7%. We improved gross margin by 200bps to 42.2% with an improvement of 330bps in the second half. We more than mitigated net material inflation of around €1.8 billion through improved productivity, price and mix while stepping up brand and marketing investment by €0.7 billion, a 130bps increase as a percentage of turnover. Overheads increased by 10bps, as we continued to invest in the expansion of our Prestige Beauty and Health & Wellbeing businesses.

Capital allocation

We continue to reshape the portfolio, allocating capital to premium segments through selective bolt-on acquisitions and divesting lower-growth businesses while balancing investment in the business and shareholder returns.

Adding to our portfolio of premium brands, we announced the acquisitions of Yasso Holdings, Inc., a premium frozen Greek yogurt brand in the United States, which completed on 1 August, and K18 , a premium biotech hair care brand, which completed on 1 February 2024.

We announced three disposals during the year: the Suave beauty and personal care brand in North America, which completed on 1 May; Dollar Shave Club, which completed on 1 November; and Elida Beauty, which comprises more than 20 personal care brands. It is expected to complete by mid-2024.

In 2023, we returned €5.9 billion to shareholders through dividends and share buybacks. We completed the final two €750 million tranches of our €3 billion share buyback programme. The quarterly interim dividend for the Fourth Quarter is maintained at €0.4268.

Reflecting the Group’s continued strong cash generation, the Board has approved a share buyback programme of up to €1.5 billion to be conducted during 2024, which we expect to commence in the second quarter.

Beauty & Wellbeing (21% of Group turnover)

In Beauty & Wellbeing, we are focused on three key priorities that will drive the unmissable superiority of our brands: elevating our core Hair Care and Skin Care brands to increase premiumisation; fuelling the growth of Prestige Beauty and Health & Wellbeing with selective international expansion; and continuing to strengthen our beauty and wellbeing capabilities.

Beauty & Wellbeing delivered a strong full year performance, with underlying sales up 8.3%, balanced between price at 3.8% and volume at 4.4%. Volume growth accelerated through the year to 6.3% in the fourth quarter, with good volumes in Hair Care and very strong volumes in Health & Wellbeing.

The full year performance reflects continued strong growth in Prestige Beauty and Health & Wellbeing, which now account for a quarter of Beauty & Wellbeing’s turnover, as well as successful relaunches of some of our core Hair Care and Skin Care brands. The relaunches were powered by our science and technology capabilities and were supported by increased investment across our key markets to elevate their superiority credentials.

Hair Care grew mid-single digit through a combination of price and volume growth, with strong growth in Latin America and Turkey. Sunsilk delivered double-digit growth for the year following a successful relaunch of the brand. Clear delivered mid-single digit growth driven by breakthrough innovation – our first clinically proven anti-dandruff formula powered by niacinamide concentrate to repair and strengthen the scalp’s skin barrier. Following the successful relaunch in China last year, the mix has now been expanded to Thailand, Turkey and Brazil.

Core Skin Care grew low-single digit driven by price. Vaseline delivered double-digit growth, reaching €1 billion of turnover in 2023. Following the launch of our successful Gluta-Hya range in South East Asia two years ago, we further expanded the platform with the launch of serums and a Pro-Age range, tapping into a larger consumer pool by extending the patented technology to more products and new markets such as India. In North Asia, AHC declined double-digit as we reset the cross-border trade channel.

Our US-centric Prestige Beauty and Health & Wellbeing portfolios, built over several years through carefully selected bolt-on acquisitions, continued to grow ahead of the market delivering double-digit growth for the year. This was supported by strong performances from Hourglass , Dermalogica and Paula’s Choice which launched a Vitamin C range, using our core science and technology capabilities.

In Health & Wellbeing, Liquid I.V. and Nutrafol performed strongly. Liquid I.V. added sugar-free and kids variants to the range, without compromising flavour or function. The brand extended its presence outside of the United States for the first time with a successful launch in Canada, and further international roll-outs planned.

Underlying operating margin was flat with gross margin improvement reinvested in marketing and overheads.

Personal Care (23% of Group turnover)

In Personal Care, we are focused on winning with science-led brands that deliver unmissable superiority to our consumers across Deodorants, Skin Cleansing, and Oral Care. Our priorities include developing superior technology and multi-year innovation platforms, leveraging partnerships with our customers, and expanding into premium areas and digital channels.

Personal Care grew underlying sales 8.9% for the year, with growth balanced between price and volume, underpinned by continued strength in Deodorants. In the fourth quarter all three categories drove positive volumes.

Personal Care’s full year growth was led by its Power Brands and science-backed innovations. These innovations offer functional benefits but also deliver enhanced health, hygiene, and superior skin cleansing. Personal Care supported these innovations with a step-up in marketing investment, including strategic sponsorships such as our first sponsorship deal with FIFA.

Deodorants grew double-digit led by strong volume growth, particularly in Europe and Latin America. Rexona grew double-digit and its range of products with 72-hour sweat and odour protection technology is now in over 100 markets. Dove delivered double-digit growth with the successful launch of Dove Advanced Care for women and the launch of a new range of Dove Men+Care antiperspirant. Axe grew high-single digit following the launch of its new, long-lasting fine fragrance collection.

Skin Cleansing delivered mid-single digit growth with positive volumes. Lux grew double-digit driven by elevated skin care benefits in soap bars from its ProGlow technology. In the United States, Dove grew mid-single digit supported by its Body Wash relaunch with new packaging and 24-hour renewing MicroMoisture technology.

Oral Care grew mid-single digit led by price. Closeup grew double-digit and Pepsodent grew mid-single digit, having expanded its premium offerings in therapeutics and whitening.

The Dove Personal Care portfolio achieved double-digit growth with balanced price and volume growth.

Underlying operating margin increased by 60bps, driven by a strong gross margin improvement that was partly re-invested in increased brand and marketing investment.

Home Care (21% of Group turnover)

In Home Care, we focus on delivering for consumers who want superior products that are sustainable and great value. We drive growth through unmissable superiority in our biggest brands, in our key markets and across channels. We have a resilient business that spans price points and grows the market by premiumising and trading consumers up to additional benefits.

Home Care grew underlying sales 5.9% for the full year, with 6.8% from price and -0.9% from volume. Volumes were positive in the second half, with a sharp price growth deceleration in emerging markets reflecting commodity cost deflation.

In Home Care, we stepped up investments in brand and marketing and R&D to drive unmissable superiority of our biggest brands and deliver innovations that enhance the efficacy and sustainability of our products.

Fabric Cleaning grew mid-single digit for the year. This was led by high-single digit growth in Latin America where we launched OMO Branco Absoluto that restores the whiteness of clothes. South Asia delivered balanced high-single digit growth as we continued to develop the market by offering a full range of products to consumers, from entry-level products such as our Wheel laundry soap bar to mid-tier Rin, to premium Surf Excel liquid detergent. Growth in Europe was flat with double-digit price growth offset by volume declines.

We expanded plastic-free packaging for OMO capsules to more countries across Europe and drove premiumisation through next-generation innovation such as laundry sheets, a convenient and sustainable alternative to liquids and capsules.

We leveraged our cross-category science and technology platforms by using fragrance innovation from Beauty & Wellbeing in Fabric Enhancers where we launched Comfort Beauty Perfume in Vietnam. Fabric Enhancers delivered mid-single digit growth driven by price with low-single digit volume decline. Turkey continued to lead growth with double-digit price and volume growth.

Home & Hygiene grew mid-single digit led by strong growth in Latin America and South Asia which was partially offset by a decline in South East Asia. In the United Kingdom, we launched Domestos Power Foam – an unmissably superior innovation that is designed to spray upside down for improved cleaning performance as well as convenience. High store penetration and availability coupled with product superiority make this a blueprint for future roll-outs.

Underlying operating margin increased by 150bps driven by the strong gross margin improvement and a step-up in brand and marketing investment.

Nutrition (22% of Group turnover)

In Nutrition, our strategy is to deliver consistent, competitive growth by offering unmissably superior products through our biggest brands. We do this by reaching more consumers and focusing on top dishes and high consumption seasons to satisfy consumers’ preferences on taste, health and sustainability; while delivering productivity and resilience in our supply chain.

Nutrition grew underlying sales 7.7% for the year, with 10.1% from price and -2.2% from volume. Growth continued to be price-led as we responded to higher input costs of food ingredients. In the fourth quarter, we saw an improvement in volumes, with our two largest brands, Hellmann’s and Knorr , returning to positive volume growth.

Growth in Nutrition was driven primarily by Knorr and Hellmann’s , which together accounted for 60% of Nutrition’s turnover in 2023. We sharpened our focus on offering holistically superior products and unmissable marketing campaigns in key seasons, supported by increased marketing and R&D investment. Our business in Europe remained challenging as a result of continued cost inflation, the targeted exit of unprofitable SKUs, and private label share gains, impacting both volumes and profitability.

Scratch Cooking Aids grew high-single digit, led by Knorr , which achieved €5 billion in turnover in 2023. North America grew mid-single digit, supported by the ‘ Knorr Taste Combos’ campaign and the launch of Knorr ready-to-eat snack pots which provide consumers with a nutritious meal while saving time. Latin America grew double-digit and Europe grew mid-single digit as we developed targeted campaigns to inspire healthier diets. Africa grew double-digit, supported by fortified products that help address malnutrition in the region.

Dressings grew double-digit driven by price. With strong foundations in taste, sustainable ingredients and recyclable bottles, Hellmann’s grew double-digit with positive volume driven by Latin America. The performance was helped by further roll-outs of our vegan and flavoured mayonnaise range. We stepped up brand marketing investment to target high consumption occasions such as Thanksgiving, Christmas or the summer BBQ season. 2023 was our third consecutive US Super Bowl ‘Make Taste, Not Waste’ campaign with nearly 10 billion earned media impressions and we partnered with the NBA in Brazil.

Unilever Food Solutions, now 20% of Nutrition’s sales, grew double-digit with positive volume and price growth driven by our strong presence in Europe, North America and North Asia. Our focus on customer service and digital selling has enabled us to serve more operators and improve productivity. As the foodservice market in China fully reopened, we grew double-digit, helped by market-making innovation such as extending Knorr bouillon to more flavours, tapping into evolving consumer preferences.

Functional Nutrition returned to growth while growing penetration and market share through its core proposition for kids as well as premium innovation tailored for women and people with diabetes.

Underlying operating margin increased by 100bps, driven by gross margin improvement which funded an increase in brand and marketing investment.

Ice Cream (13% of Group turnover)

Ice Cream grew underlying sales by 2.3%, with 8.8% from price and -6.0% from volume. Volumes were impacted throughout the year by high price elasticities with consumers downtrading to value formats and less favourable summer weather versus last year, mainly in Europe. In the fourth quarter, price growth slowed significantly after double-digit price growth in the first half of the year.

Ice Cream had a disappointing year with declining market share and profitability. We continued to invest behind our Power Brands, including Magnum and Cornetto , which generated almost 85% of the Business Group’s turnover. These brands remain well positioned to meet consumers’ desire for superior and indulgent ice cream. Emerging markets delivered mid-single digit growth, driven by a strong performance in Turkey. In the fourth quarter, we made additional investments in promotions, particularly in North America, to address competitiveness and volume decline.

In the full year, there was a marginal decline in In-home Ice Cream (around 60% of the business), with volumes down high-single digit broadly offset by pricing. Inflation remained high and private label gained share as consumers looked for value propositions in this discretionary category. In the United States, our Talenti brand expanded from pints into new formats with mini gelato and sorbetto bars.

Out-of-home Ice Cream (around 40% of the business) grew high-single digit, driven by strong pricing partially offset by some volume decline. Our limited-edition Magnum innovation, Starchaser and Sunlover, performed well and became Magnum's biggest ever innovation.

Underlying operating margin declined 90bps, driven by lower gross margin as a result of continued cost inflation and volume deleverage outstripping pricing, while brand and marketing investment increased.

Related Links

• 2023 Full Year Overview
• View the latest results

Competitiveness % Business Winning measures the aggregate turnover of the portfolio components (country/category cells) gaining value market share as a % of the total turnover measured by market data. As such, it assesses what percentage of our revenue is being generated in areas where we are gaining market share.

Sverdlovsk Oblast

Natural resources

Early history, medieval history and russian expansion, rise of the mining-metallurgical era, soviet ural, post-soviet transition, administrative divisions, demographics, settlements, ethnic groups, chairmen of the oblast duma, chairmen of the house of representatives of the legislative assembly, economy and transportation, sister relationships, notable people, external links.

Most of the oblast is spread over the eastern slopes of the Middle and North Urals and the Western Siberian Plain . Only in the southwest does the oblast stretch onto the western slopes of the Ural Mountains .

The highest mountains all rise in the North Urals, Konzhakovsky Kamen at 1,569 metres (5,148   ft) and Denezhkin Kamen at 1,492 metres (4,895   ft) . The Middle Urals is mostly hilly country with no discernible peaks; the mean elevation is closer to 300 to 500 metres (980 to 1,640   ft) above sea level. [9] Principal rivers include the Tavda , the Tura , the Chusovaya , and the Ufa , the latter two being tributaries of the Kama .

Sverdlovsk Oblast borders with, clockwise from the west, Perm Krai , the Komi Republic , Khanty–Mansi Autonomous Okrug , Tyumen Oblast , Kurgan , and Chelyabinsk Oblasts , and the Republic of Bashkortostan .

The area is traversed by the northeasterly line of equal latitude and longitude.

Rich in natural resources, the oblast is especially famous for metals ( iron , copper , gold , platinum ), minerals ( asbestos , gemstones , talcum ), marble and coal . It is mostly here that the bulk of Russian industry was concentrated in the 18th and 19th centuries.

The area has continental climate patterns, with long cold winters (average temperatures reaching −15   °C (5   °F) to −25   °C (−13   °F) on the Western Siberian Plain) and short warm summers. Only in the southeast of the oblast do temperatures reach +30   °C (86   °F) in July.

• You can help expand this section with text translated from the corresponding article in Russian . (November 2020) Click [show] for important translation instructions. View a machine-translated version of the Russian article.

The territory of the region has been inhabited since ancient times. Numerous sites of ancient people were discovered, dating from the Paleolithic to the Iron Age. The Upper Paleolithic includes the Garinsky site on the right bank of the Sosva river near the village of Gari , the site in the Shaitansky grotto, and the site in the Bezymyanny cave (X millennium BC). [10] [11] In 1890, the 11 thousand years old (Mesolithic) Shigir idol was discovered. [12]

A settlement and a burial ground in the Kalmatsky Brod tract are located on the right bank of the Iset river and date back to the Sarmatian time (from the 3rd century BC to the 2nd century AD). They belong to the Kalmak archaeological culture. In the Kalmatsky Brod burial ground, the skeletal skulls were strongly deformed by tight bandaging in early childhood, which indicates the penetration of steppe ethnic elements to the north. [13]

There are numerous pictograms on the Koptelovsky stone, on the Oblique stone, on the Two-eyed stone, Starichnaya, Serginskaya, the rock paintings of the Bronze Age on the Neyva River, Tagil River (villages Brekhovaya, Gaevaya, Komelskaya), rock carvings on Shaitan-Kamen on the right bank of the Rezh river tied to indigenous Ural population, possibly speakers of a Ugric language . [14] [15] The Gostkovskaya Pisanitsa refers to the Middle Ages. [12]

Before the first Russian colonists arrived to the region, it was populated by various Turkic and Ugrian tribes. By the 16th century, when the Middle Urals were under influence of various Tatar khanates, the strongest local state was the Vogul Pelym principality with its center in Pelym .

The Russian conquest of the Khanate of Kazan in the 1550s paved the way further east, which was now free from Tatar depredations (see Yermak Timofeyevich ). The first surviving Russian settlements in the area date back to the late 16th   – early 17th centuries ( Verkhoturye , 1598; Turinsk , 1600; Irbit , 1633; Alapayevsk , 1639). At that time, those small trading posts were governed under Siberian administration in Tobolsk . After the 1708 administrative reform, Verkhoturye, Pelym and Turinsk became a part of the new Siberian Governorate , in 1737 their territories were assigned to the Kazan Governorate .

During the 18th century, rich resources of iron and coal made Ural an industrial heartland of Russia. After getting control over Ural mines, the Demidov family put the region in the forefront of Russian industrialization. Yekaterinburg , Nevyansk and Tagil ironworks, founded in the 1700s to 1720s, soon joined the ranks of the major producers in Europe. Throughout the 18th and 19th century those newly founded factory towns enjoyed a status of special mining-metallurgical districts allowed to have a certain rate of financial and proprietary autonomy. During the 1781 reform middle Ural finally got its own regional administration in the form of the Perm Governorate .

When in 1812 the Russian government legalized gold digging for its citizens, Middle Ural became a center of gold mining. Entrepreneurs of the Perm Governorate also started the gold rush in West Siberia, soon Yekaterinburgers began to dominate the Russian market of precious metals and gemstones.

After the emancipation reform of 1861 , major Middle Uralian industries that were heavily dependent on serf labor entered decline, although it also allowed light industry to thrive. In 1878, Perm and Yekaterinburg were connected with a railroad, in 1888, railroads reached Tyumen , and ultimately, in 1897, Yekaterinburg joined the Trans-Siberian network . Emergence of railroad transportation helped to revitalize economy of Ural.

The Bolsheviks established their power in Yekaterinburg and Perm during the first days of the October Revolution of 1917. In early 1918 the dethroned Czar Nicholas II and his family were transferred under custody to Yekaterinburg. Local Bolsheviks decided autonomously to execute the royal family on July 17, 1918, to prevent its rescue of by the approaching White Army forces. Ten days later Yekaterinburg was captured by the Czechoslovak troops of Sergei Wojciechowski . For the next year the Anti-bolshevik forces took control over the region. On 19 August 1918, Provisional Government of Ural was formed in Yekaterinburg by a coalition of liberal and democratic socialist parties, it was supposed to serve as a buffer between the Komuch and Provisional Siberian governments. After the Kolchak coup d'état in Omsk in November 1918, the Government of Ural was disbanded.

In July 1919, in the course of the Yekaterinburg offense, Yekaterinburg and the surrounding areas were recaptured by the Red Army forces under command of Vasily Shorin . On the July 15th, the Perm Governorate was split by the Soviets and the east, for the first time in history, became a separate region, the Yekaterinburg Governorate. It was soon abolished and replaced by the Ural Oblast (1923-1934).

In the 1930s many industrial enterprises were established and built with the help of forced labour. [16] Local industry received another impetus during World War II, when important producing facilities were relocated here from the European part of Russia to safeguard them from the advancing Germans (for example, IMZ-Ural , Kamensk-Uralsky Metallurgical Works ). In the postwar period much of the region was off-limits to foreigners. It was over Sverdlovsk that the American U-2 spy plane pilot Gary Powers was shot down on May 1, 1960, while on a reconnaissance mission.

In 1979, there was an anthrax outbreak caused by an accident in a facility to develop biological weapons.

In 1993, Governor Eduard Rossel responded to perceived economic inequality by attempting to create a " Ural Republic ." Sverdlovsk led the "Urals Five" ( Kurgan Oblast , Orenburg Oblast , Perm Krai , Chelyabinsk Oblast and Sverdlovsk) in a call for greater regional power. They argued that the oblasts deserved as much power as the ethnic homeland republics . The Urals Republic Constitution went into effect on October 27, 1993. Then Russian President Boris Yeltsin dissolved the Urals Republic and the Sverdlovsk Parliament 10 days later (on November 9).

Population : 4,268,998   ( 2021 Census ) ; [5] 4,297,747   ( 2010 Russian census ) ; [17] 4,486,214   ( 2002 Census ) ; [18] 4,716,768   ( 1989 Soviet census ) . [19]

Vital statistics for 2022: [20] [21]

• Births: 39,958 (9.4 per 1,000)
• Deaths: 59,316 (13.9 per 1,000)

Total fertility rate (2022): [22] 1.56 children per woman

Life expectancy (2021): [23] Total — 68.79 years (male   — 63.72, female   — 73.80)

There were twenty-one recognized ethnic groups of more than two thousand persons each in the oblast. Residents identified themselves as belonging to a total of 148 different ethnic groups, including: [17]

• 3,684,843 Russians (90.6%);
• 143,803 Tatars (3.5%);
• 35,563 Ukrainians (0.9%);
• 31,183 Bashkirs (0.8%);
• 23,801 Mari (0.6%);
• 14,914 Germans (0.4%);
• 14,215 Azerbaijanis (0.3%);
• 13,789 Udmurts (0.3%);
• 11,670 Belarusians (0.3%);
• 11,510 Chuvash (0.26%);
• 11,501 Armenians (0.3%);
• 11,138 Tajiks (0.3%);
• 9,702 Mordovians (0.22%);
• 9,358 Uzbeks (0.2%);

232,978 people were registered from administrative databases, and could not declare an ethnicity. It is estimated that the proportion of ethnicities in this group is the same as that of the declared group. [24]

Christianity is the largest religion in Sverdlovsk Oblast. According to a 2012 survey [25] 43% of the population of Sverdlovsk Oblast adheres to the Russian Orthodox Church , 5% are nondenominational Christians (excluding Protestant churches), 3% are Muslims , 2% are Orthodox Christian believers without belonging to any Church or are members of other Orthodox churches , 1% are adherents of the Slavic native faith (Rodnovery), and 0.3% are adherents of forms of Hinduism ( Vedism , Krishnaism or Tantrism ). In addition, 36% of the population declares to be "spiritual but not religious", and 9.7% is atheist . [25]

The most important institutions of higher education include Ural Federal University , Ural State Medical University , Ural State University of Economics , Ural State Law University , Ural State Mining University and Ural State Academy of Architecture and Arts , all located in the capital Yekaterinburg.

The oblast's Charter, adopted on 17 December 1994, with subsequent amendments, establishes the oblast government. The Governor is the chief executive, who appoints the Government, consisting of ministries and departments. The Chairman of the Government, commonly referred to as the Prime Minister, is appointed with the consent of the lower house of the legislature , a process similar to the appointment of the federal Prime Minister . But the Governor cannot nominate the same candidate more than twice, yet he/she can dismiss the house after three failed attempts to appoint the Premier. [ needs update ]

The Legislative Assembly is the regional parliament of Sverdlovsk Oblast. Until 2011, it was a bicameral legislature consisting of the Oblast Duma, the lower house , and the House of Representatives, the upper house . [27] Before the reform, members of the legislature served four-year terms with half of the Duma re-elected every two years. The Duma (28   members) was elected in party lists. The 21   members of the House of Representatives were elected in single-seat districts in a first-past-the-post system. The Legislative Assembly was the first bicameral legislature outside an autonomous republic, and the first regional legislature in Russia to elect members based on both party lists and single-seat districts . As of 2021, the Legislative Assembly is a unicameral legislature with a total of 50 seats, with half of the members elected by single-mandate constituencies and the other half elected in party lists for five-year terms. [28] [29]

Compliance with the Charter is enforced by the Charter Court. The existence of such regional courts in Russia, formed and functioning outside the federal judiciary, although challenged, has been upheld and persisted successfully in most constituent members of the Federation where they were established.

Until President Putin 's reforms of 2004, the Governor was elected by direct vote for terms of four years. Eduard Rossel has been the only elected governor (first elected governor for an oblast in Russia) since 1995 (appointed in 1991 and dismissed in 1993 by President Yeltsin ), re-elected in 1999 and 2003.

Since 2012, the oblast's Governor is Yevgeny Kuyvashev .

In the 1990s, the Oblast's population was distinguished by relatively high support for parties and candidates of the right and democratic persuasion. In the 1996 presidential election, Boris Yeltsin , a native of the region who lived in Sverdlovsk until the 1980s, won over 70% of the vote. In the regional elections in 2010 in the Sverdlovsk Oblast, United Russia received minimal support relative to other regions - only 39.79% of votes. [30]

Even though it could do with modernizing, the region's industries are quite diverse. 12% of Russia's iron and steel industry is still concentrated in Sverdlovsk oblast. Iron and copper are mined and processed here, the logging industry and wood-processing are important, too.

The largest companies in the region include Ural Mining and Metallurgical Company , UralVagonZavod , Enel Russia , Nizhniy Tagil Iron and Steel Works , Federal Freight . [31]

Yekaterinburg is a prominent road, rail and air hub in the Ural region. As the economic slump subsided, several European airlines started or resumed flights to the city. These include Lufthansa , British Airways , CSA , Turkish Airlines , Austrian Airlines and Finnair . Malév Hungarian Airlines used to be among those carriers but they had to drop their flights to SVX ( IATA airport code for Sverdlovsk) after a few months.

The Alapaevsk narrow-gauge railway serves the communities around Alapayevsk .

• Bà Rịa–Vũng Tàu province , Vietnam
• Harbin , China
• Vladik Dzhabarov , Russian cyclist
• Andrey Fedyaev , Russian cosmonaut
• Yakov Sverdlov , a communist revolutionary after whom Sverdlovsk and subsequently Sverdlovsk Oblast were named.
• Church of the Purification of the Blessed Virgin Mary , a building of regional historical significance in Staropyshminsk village.

Related Research Articles

Chelyabinsk Oblast is a federal subject of Russia in the Ural Mountains region, on the border of Europe and Asia. Its administrative center is the city of Chelyabinsk.

Irbit is a town in Sverdlovsk Oblast, Russia, located 203 kilometers (126 mi) from Yekaterinburg by train or 250 kilometers (160 mi) by car, on the right bank of the Nitsa. Population: 37,009 (2021 Census) ; 38,357 (2010 Russian census) ; 43,318 (2002 Census) ; 51,708 (1989 Soviet census) .

Alapayevsk is a town in Sverdlovsk Oblast, Russia, located at the confluence of the Neyva and Alapaikha rivers. Population: 38,192 (2010 Russian census) ; 44,263 ; 50,060 ; 49,000 (1968).

Kushva is a town in Sverdlovsk Oblast, Russia, located in the Ural Mountains near Yekaterinburg. Population: 30,167 (2010 Russian census) ; 35,555 (2002 Census) ; 43,096 (1989 Soviet census) .

Nizhniye Sergi is a town and the administrative center of Nizhneserginsky District in Sverdlovsk Oblast, Russia, located on a rolling plain surrounded by the Ural Mountains, on the Serga River 120 kilometers (75 mi) from Yekaterinburg, the administrative center of the oblast. Population: 10,336 (2010 Russian census) ; 12,567 (2002 Census) ; 14,938 (1989 Soviet census) .

Verkhnyaya Pyshma is a town in Sverdlovsk Oblast, Russia, located 1 kilometer (0.62 mi) north of Yekaterinburg. Population: 59,749 (2010 Russian census) ; 58,016 (2002 Census) ; 53,102 (1989 Soviet census) .

Novouralsk is a closed town in Sverdlovsk Oblast, Russia, located on the eastern side of the Ural Mountains, about 70 kilometers (43 mi) north of Yekaterinburg, the administrative center of the oblast. Population: 85,522 (2010 Russian census) ; 95,414 (2002 Census) .

Krasnoufimsk is a town in Sverdlovsk Oblast, Russia, located on the Ufa River, 224 kilometers (139 mi) from Yekaterinburg. Population: 39,765 (2010 Russian census) ; 43,595 (2002 Census) ; 45,618 (1989 Soviet census) .

Revda is a town in Sverdlovsk Oblast, Russia. Population: 61,875 (2010 Russian census) ; 62,667 (2002 Census) ; 65,757 (1989 Soviet census) .

Sredneuralsk is a town under the administrative jurisdiction of the Town of Verkhnyaya Pyshma in Sverdlovsk Oblast, Russia, located on the shore of Iset Lake, at the head of the Iset River, 25 kilometers (16 mi) north of Yekaterinburg. Population: 20,449 (2010 Russian census) ; 19,555 ; 18,786 (1989 Soviet census) .

Kachkanar is a town in Sverdlovsk Oblast, Russia, located between the Isa and Vyya Rivers in the Tura River's basin, 205 kilometers (127 mi) north of Yekaterinburg, the administrative center of the oblast. Population: 41,426 (2010 Russian census) ; 44,664 (2002 Census) ; 48,251 (1989 Soviet census) . The town of Kachkanar is located at the foot of mountain Kachkanar.

Ivdel is a town in Sverdlovsk Oblast, Russia, located on the Ivdel River near its confluence with the Lozva River, 535 kilometers (332 mi) north of Yekaterinburg, the administrative center of the oblast. Population: 17,775 (2010 Russian census) ; 19,324 (2002 Census) ; 19,014 (1989 Soviet census) .

Severouralsk is a town in Sverdlovsk Oblast, Russia, located on the Vagran River at its confluence with the Kolonga River, 512 kilometers (318 mi) north of Yekaterinburg, the administrative center of the oblast. As of the 2010 Census, its population was 29,263.

Pelym is an urban locality under the administrative jurisdiction of the Town of Ivdel in Sverdlovsk Oblast, Russia. Population: 3,376 (2010 Russian census) ; 3,708 (2002 Census) .

Sukhoy Log is a town and the administrative center of Sukholozhsky District in Sverdlovsk Oblast, Russia, located on the eastern slopes of the Ural Mountains on the Pyshma River, 114 kilometers (71 mi) east of Yekaterinburg, the administrative center of the oblast. As of the 2010 Census, its population was 34,554.

Gornozavodsky District is an administrative district (raion) of Perm Krai, Russia; one of the thirty-three in the krai. Municipally, it is incorporated as Gornozavodsky Municipal District . It is located on the western slopes of the Ural Mountains in the east of the krai. The area of the district is 7,057 square kilometers (2,725 sq mi). Its administrative center is the town of Gornozavodsk. Population: 26,044 (2010 Russian census) ; 30,172 (2002 Census) ; 38,004 (1989 Soviet census) . The population of Gornozavodsk accounts for 46.3% of the district's total population.

Garinsky District is an administrative district (raion), one of the thirty in Sverdlovsk Oblast, Russia. As a municipal division, it is incorporated as Garinsky Urban Okrug . The area of the district is 16,770 square kilometers (6,470 sq mi). Its administrative center is the urban locality of Gari. Population: 4,904 ; 7,832 (2002 Census) ; 9,381 (1989 Soviet census) . The population of Gari accounts for 50.4% of the district's total population. The main point of historical interest is the former town of Pelym, which was one of the first Russian settlements east of the Urals, marking the eastern terminus of the Cherdyn Road from Europe to Siberia.

Turinsky District is an administrative district (raion), one of the thirty in Sverdlovsk Oblast, Russia. As a municipal division, it is incorporated as Turinsky Urban Okrug . Its administrative center is the town of Turinsk. Population: 28,274 ; 32,540 (2002 Census) ; 40,749 (1989 Soviet census) . The population of Turinsk accounts for 63.4% of the district's total population.

Isetsky District is an administrative district (raion), one of the twenty-two in Tyumen Oblast, Russia. As a municipal division, it is incorporated as Isetsky Municipal District . It is located in the west of the oblast. The area of the district is 2,751 square kilometers (1,062 sq mi). Its administrative center is the rural locality of Isetskoye. Population: 26,061 ; 26,565 (2002 Census) ; 25,862 (1989 Soviet census) . The population of Isetskoye accounts for 28.7% of the district's total population.

Bisert is an urban locality in Nizhneserginsky District of Sverdlovsk Oblast, Russia. Population: 10,233 (2010 Russian census) ; 11,262 (2002 Census) ; 12,646 (1989 Soviet census) .

• ↑ Президент Российской Федерации.   Указ   №849   от   13 мая 2000 г. «О полномочном представителе Президента Российской Федерации в федеральном округе». Вступил в силу   13 мая 2000 г. Опубликован: "Собрание законодательства РФ", No.   20, ст. 2112, 15 мая 2000 г. (President of the Russian Federation.   Decree   # 849   of   May 13, 2000 On the Plenipotentiary Representative of the President of the Russian Federation in a Federal District . Effective as of   May 13, 2000.).
• ↑ Госстандарт Российской Федерации.   №ОК 024-95   27 декабря 1995 г. «Общероссийский классификатор экономических регионов. 2.   Экономические районы», в ред. Изменения №5/2001 ОКЭР. ( Gosstandart of the Russian Federation.   # OK 024-95   December 27, 1995 Russian Classification of Economic Regions. 2.   Economic Regions , as amended by the Amendment   # 5/2001 OKER. ).
• ↑ Official website of the Governor of Sverdlovsk Oblast. Alexander Sergeyevich Misharin (in Russian)
• 1 2 3 Russian Federal State Statistics Service. Всероссийская перепись населения 2020 года. Том 1 [ 2020 All-Russian Population Census, vol. 1 ] (XLS) (in Russian). Federal State Statistics Service .
• ↑ "26. Численность постоянного населения Российской Федерации по муниципальным образованиям на 1 января 2018 года" . Federal State Statistics Service . Retrieved 23 January 2019 .
• ↑ "Об исчислении времени" . Официальный интернет-портал правовой информации (in Russian). 3 June 2011 . Retrieved 19 January 2019 .
• ↑ Official throughout the Russian Federation according to Article   68.1 of the Constitution of Russia .
• ↑ "Russia: Impact of Climate Change to 2030" (PDF) . Retrieved 25 April 2023 .
• ↑ Сериков Ю. Б. Новые находки раннего палеолита в Среднем Зауралье // Ранний палеолит Евразии: новые открытия // Материалы Международной конференции, Краснодар – Темрюк, 1–6 сентября 2008 г.
• ↑ Сериков Ю. Б. Следы раннего палеолита на территории Среднего Зауралья // Вестник археологии, антропологии и этнографии, 2015 № 4 (31)
• 1 2 Объекты культурного наследия Свердловской области (список)
• ↑ Сальников К. В. Древнейшие памятники истории Урала , 1952.
• ↑ Khimiya i Zhizn , 9, 1974, p. 80
• ↑ Писаницы Урала (in Russian). Ural.ru . Retrieved 26 December 2010 .
• ↑ V.A. Kravchenko: I chose freedom (1946)
• 1 2 Russian Federal State Statistics Service (2011). Всероссийская перепись населения 2010 года. Том   1 [ 2010 All-Russian Population Census, vol.   1 ] . Всероссийская перепись населения 2010   года [2010 All-Russia Population Census] (in Russian). Federal State Statistics Service .
• ↑ Federal State Statistics Service (21 May 2004). Численность населения России, субъектов Российской Федерации в составе федеральных округов, районов, городских поселений, сельских населённых пунктов   – районных центров и сельских населённых пунктов с населением 3   тысячи и более человек [ Population of Russia, Its Federal Districts, Federal Subjects, Districts, Urban Localities, Rural Localities—Administrative Centers, and Rural Localities with Population of Over 3,000 ] (XLS) . Всероссийская перепись населения 2002   года [All-Russia Population Census of 2002] (in Russian).
• ↑ Всесоюзная перепись населения 1989   г. Численность наличного населения союзных и автономных республик, автономных областей и округов, краёв, областей, районов, городских поселений и сёл-райцентров [ All Union Population Census of 1989: Present Population of Union and Autonomous Republics, Autonomous Oblasts and Okrugs, Krais, Oblasts, Districts, Urban Settlements, and Villages Serving as District Administrative Centers ] . Всесоюзная перепись населения 1989   года [All-Union Population Census of 1989] (in Russian). Институт демографии Национального исследовательского университета: Высшая школа экономики [Institute of Demography at the National Research University: Higher School of Economics]. 1989 – via Demoscope Weekly .
• ↑ "Information on the number of registered births, deaths, marriages and divorces for January to December 2022" . ROSSTAT . Archived from the original on 2 March 2023 . Retrieved 21 February 2023 .
• ↑ "Birth rate, mortality rate, natural increase, marriage rate, divorce rate for January to December 2022" . ROSSTAT . Archived from the original on 2 March 2023 . Retrieved 21 February 2023 .
• ↑ Суммарный коэффициент рождаемости [ Total fertility rate ] . Russian Federal State Statistics Service (in Russian). Archived from the original (XLSX) on 10 August 2023 . Retrieved 10 August 2023 .
• ↑ "Демографический ежегодник России" [ The Demographic Yearbook of Russia ] (in Russian). Federal State Statistics Service of Russia (Rosstat) . Retrieved 1 June 2022 .
• ↑ "ВПН-2010" . www.perepis-2010.ru .
• 1 2 3 "Arena: Atlas of Religions and Nationalities in Russia" . Sreda, 2012.
• ↑ 2012 Arena Atlas Religion Maps . "Ogonek", № 34 (5243), 27/08/2012. Retrieved 21/04/2017. Archived .
• ↑ Formation of the legislative body of Sverdlovsk Oblast , old.zsso.ru
• ↑ General information , zsso.ru
• ↑ "Свердловская область" . council.gov.ru .
• ↑ "Результат единороссов по Свердловской области был самым худшим для партии власти" [ The result of United Russia in the Sverdlovsk region was the worst for the ruling party ] . Archived from the original on 10 June 2010 . Retrieved 2 January 2011 .
• ↑ "Sverdlovsk region Industries" . investinregions.ru . Retrieved 7 November 2018 .
• Sverdlovsk Oblast on Facebook
• Investment portal of Sverdlovsk Oblast
• (in Russian) Official website of the Government of Sverdlovsk Oblast

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EY and Sigma Healthcare transform pharmacy supply chain with SAP Integrated Business Planning for Supply Chain solution

Multidisciplinary professional services organization

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Sydney, Australia – 6 August 2024 – Ernst & Young, Australia (EY) and Sigma Healthcare collaborated to streamline their supply chain operations through the implementation of SAP® Integrated Business Planning for Supply Chain (SAP IBP) solution. This transformation has significantly improved Sigma's operational efficiency, optimised inventory management, increased customer service levels and satisfaction across its extensive network of pharmacies and ordering of over 16,000 products from nearly 400 vendors across the globe.

Sigma Healthcare, a leading wholesale and distribution business in the pharmaceutical industry, faced challenges with manual supply planning processes that were time-consuming and prone to human error. To address these issues, Sigma turned to EY for its highly skilled experience implementing SAP IBP, a solution that seamlessly integrates with Sigma's existing SAP S/4HANA® system.

Katherine Boiciuc, EY Chief Technology and Innovation Officer, Oceania , remarked: “The transition to SAP IBP has been a game-changer for Sigma Healthcare. By leveraging the EY team’s proficiency in SAP implementation, Sigma has not only streamlined its supply chain processes but also set a new standard for operational excellence in the pharmaceutical industry. This project exemplifies how technology can drive significant business transformation and deliver tangible benefits.”

The implementation of SAP IBP has been important in helping to yield impressive results for Sigma Healthcare:

• Enhanced customer trust: Being able to consistently and repeatedly deliver high service standards was a critical milestone in significantly boosting customer trust and satisfaction.
• Increased employee satisfaction: The planning team now spends only 2-3 hours per day on supply planning tasks, allowing them to focus on refining processes and other value-adding activities.
• Reduced inventory: Inventory levels decreased by 20%, minimising wastage and optimising stock management.
• Improved availability: Product availability increased by 5%, ensuring that customers have access to a wider range of essential medicines.
• Enhanced forecast accuracy: Forecast accuracy has improved by 5%-10%, enabling better long-term planning and decision-making.

Martin Hawkins, Chief Information Officer, Sigma Healthcare , expressed his satisfaction with the project: "Since implementing the Response and Supply module of SAP IBP, we have seen improved metrics across the board, including reduced inventory, increased availability and greater efficiencies. This transformation could not have been achieved without the hard work and dedication of both the EY team and our Sigma Operations Planning Team. The new system has also improved our ability to forward plan for events such as supplier closures and public holidays, further enhancing our service to customers.”

Speaking at SAP Australia and New Zealand’s flagship customer event SAP NOW ANZ, Angela Colantuono, President and Managing Director, SAP Australia and New Zealand said: “At SAP we believe technology has a critical role to play in helping organisations to become resilient and sustainable enterprises. By turning to SAP Integrated Business Planning, Sigma Healthcare is not only empowering its workers through simplified processes, but improved planning has enabled it to remove excess inventory and wastage and increase stock availability to more effectively support its community pharmacy network."

The success of this project highlights the importance of strategic collaboration and the adoption of innovative technologies in driving business growth and operational excellence. Sigma Healthcare is now better positioned to support its network of pharmacies and deliver high-quality healthcare services to communities across Australia.

For media inquiries, please contact: Tim Madin EY Regional Strategic Communications Leader, Oceania tim.madin@au.ey.com +61 2 8295 6773

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EY refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. Information about how EY collects and uses personal data, and a description of the rights individuals have under data protection legislation are available via ey.com/privacy. EY member firms do not practice law where prohibited by local laws. For more information about our organisation, please visit ey.com.

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EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.