Taking a page from the JCPenney playbook, Procter & Gamble is turning to its former CEO to help save a consumer products giant beset by agitated investors and an R&D pipeline that has fizzled in recent years, according to Businessweek.
A.G. Lafley is returning to run the world's largest household products maker, replacing Bob McDonald in the midst of a major restructuring. Lafley is taking on the roles of chairman, president and CEO, effective immediately, while McDonald is set to retire on June 30 after 33 years at P&G, Reuters reported.
The Economist's Schumpeter column wrote that McDonald never seemed entirely comfortable in the leading role he accepted in 2009 at the firm where he had worked for three decades, especially as growth slowed and an activist hedge-fund run by Bill Ackman started to lobby for management change.
McDonald was thought to be in jeopardy of losing his job last summer after a string of reductions to profit forecasts frustrated analysts and investors, and Ackman barreled onto the scene, unveiling a $1.8 billion stake in the company, Forbes reported.
The move, Reuters said, comes as some investors have pushed for faster improvements from the maker of Tide detergent and Gillette razors. P&G unveiled a $10 billion restructuring program in February 2012. Since then, it has cut thousands of jobs and taken other steps to speed up its operations, improve its success with new products and better its performance in fast-growing emerging markets and larger, developed markets such as the United States.
"Bob retired, the board called me and I felt like duty called. I'm back to help maintain the business momentum and keep this productivity program going," Lafley told Reuters.
There was no single reason for McDonald's retirement, Lafley said. "I think it's a number of personal reasons."