L’Oréal is the world’s largest cosmetics company that specializes in hair color, make-up, skin care, perfumes and sun protection for both men and women. The Clichy, France headquartered company, has three branches, namely, cosmetics, beauty shop, and dermatology. The cosmetics branch, in particular, deals with consumer products, professional and luxury products as well as active cosmetics (David " David, 2015). The former segment, on the other side, includes hair care products used by professional hairdressers such as Matrix, Redken and Kerastase (David " David, 2015). The professional products are sold globally under brands such as Giorgio Armani and Lancome. The latter division consists of products that are mostly sold in pharmacies through Vichy and La Roche Posay brands (David " David, 2015).
L’Oréal history
The company was founded by Eugène Schueller, a young and creative chemist in 1909. L’Oréal began with hair dyes that Schueller formulated and gave to hairdressers in Paris. From then henceforth, the culture of research and innovation that the founder started in beauty service, is still part and parcel of L’Oréal (David " David, 2015). The company has experienced four main phases: 1909-1956 (involved the first steps of coming up with the hair dyes), 1957-1983 (characterized with global expansion through acquisitions), 1984-2000 (the seventeen years were marked with excellent growth, and L’Oréal became number one in the beauty industry). 2001 to date, the company is embracing diversity in its global growth which has given it a competitive advantage.
Strategy
The company’s strategy is universalization (David " David, 2015). This means that L’Oreal’s understands and respects differences in desires, needs, and traditions (L’Oréal, 2017). As such it offers tailor-made beauty products that meet the aspirations of consumers in different parts of the world. The positive aspect of the strategy is that the company is committed to sustainable, responsible and shared growth that seeks to improve both the social and environmental profiles. The corporate level strategies include horizontal, vertical integration and strategic alliances. The strategies have helped the billion dollar company to build a sharp image in different geographic markets.
L’Oréal mission
Beauty is a language- For over one hundred years, L’Oreal has no other purpose other than allowing their customers to express their individuality, be confident and open up to others. This shows that the company is determined to meet the needs of its customers and would do anything to ensure their products only bring out the best in their customers.
Beauty for all- L’Oréal is in no other business other than offering men and women the best cosmetics regarding quality, efficacy, and safety. This means that the company attracts a wide range of customers regardless of their ethnicities, age, and gender.
From its mission that beauty is a science, shows that for every product the company produces, research, resources, energy, and innovation play a crucial role to preserve the beauty of its customers. Beauty as a commitment, on the other hand, means that L’Oreal effectively uses its workforce, diversity of teams and richness with a commitment to produce universal quality products.
Organizational Structure
The structure reflects the chain of command in L’Oreal that is continuous and extends from upper management levels to lowest levels, probably interns. It clarifies who reports to who. For example, the directors make decisions that are audited by a given committee, and the final decision maker is the CEO. So authority is practiced by those in upper levels which facilitates decision making and coordination. Considering that L’Oreal is a global company, authority is divided into geographical zones with a manager at the top and other employees below. The employees assume the obligation of performing assigned duties in their specific departments. Importantly, the structure makes it possible for employees to access information at the top management.
L’Oreal’s short-term goal is to make beauty products that are universal to all. Additionally, the firm purposes to maintain health and safety at the workplace (L’Oréal, 2017). By 2020, L’Oreal has a goal of improving the environmental and social profile of all its new and renovated products (L’Oréal, 2016 Progress report, 2017).
Its long-term goal is to globally win the trust of over one billion customers by producing products that meet their desires and needs. The company is also committed to reduce its impact on the environment through absolute reductions in greenhouse gas emissions, water, and other resource use.
Concerning improving the strategy, perhaps the company could utilize the latest technology such as information sharing tools to keep team members in different countries updated all the time. For the mission, their slogan ‘beauty for all’ is well articulated. Amendments to it would render it less powerful.
The organizational structure could be made in such a way that it allows employee empowerment in planning, goal setting, and organization. As such, there would be shared responsibility for management, leadership, and accountability.
References
David, F. R., " David, F. R. (2015). Strategic management concepts and cases: A competitive advantage approach (15th ed.). Upper Saddle River: Pearson Edducation,Inc.
L’Oréal. (2017, April 20). 2016 Progress report. Retrieved Dec 11, 2018, from L’Oréal: https://www.loreal.com/media/press-releases/2017/april/progress-report-2016
L’Oréal. (2017). L’Oréal Annual Report. Retrieved Dec 11, 2018, from L’Oréal: https://www.loreal-finance.com/en/annual-report-2017/mission-strategy
