Unilever - Cleaning up in Africa
Unilever is the world's biggest food and soap company. It works its way into the lives of millions of people in 150 countries round the world, with brands like Omo washing powder, Lipton tea, Dove soap, and Magnum ice-cream.
But this multinational operates with a distinctive approach. Unlike some other corporations such as Coca Cola and McDonalds, it's built its success largely by adapting its products to local conditions, rather than making a virtue of their uniformity.
It calls itself the "multi-local multinational".
In Ghana, for example, that means producing tiny packs of Frytol cooking oil and Close-up toothpaste, simply because that is all most consumers can afford. The company's distribution network, built up over many years, is also adapted to this economy where many people have no savings. Goods are effectively given to street traders on one week's credit, and the payment is collected a week later when the trader has accumulated some cash from his or her customers.
By carefully cultivating the custom of some of the poorest people in the world, as well as richer consumers in developed countries, Unilever has become a fantastically wealthy company. For the first nine months of 2002, its profits exceeded 3 billion euros.
But the company is not without its problems.
Three years ago it launched a radical attempt to prune what had become a fragmented empire, with too many brands and too wide an assortment of businesses. Seventy-three factories have been sold or closed, and around 30,000 jobs cut. Meanwhile, the average age of managers has fallen by ten years.
This cost-cutting may have been severe, but is balanced by other corporate policies. Unilever's British arm was founded in the 19th century with a strong philosophy of paternalism, a philosophy it practices today under the more fashionable label of "corporate social responsibility".
The company spent 57 million euros on community programmes in 2001, from a turnover of just over 52 billion euros. At a palm-oil plantation in southern Ghana, for example, it not only runs a school, but boosts the teachers' modest government salaries by 60 per cent in order to attract them to such a remote location.
Like many companies in the modern world of business, Unilever understands the value of being seen to benefit the communities where it works. Unlike some of those companies, however, it's been doing this for a very long time.
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