Victoria Swann
Management Strategy and Policy
Case # 3 Making Over Avon
1. Strategic management and the process are definitely an essential part on modifying Avon. At
the time, Andrea Jung had the task of reinventing the $10.7 billion dollar company. She
definitely had to create a new spin on maintaining a strong organizational culture. The previous
view on the company was that it was for older women who were selling to neighbors. And, the
situation was analyzed when research and development had been found to have only been one
percent in the review of the company. There were numerous changes that had to take place to
spruce up the company’s presence. Therefore, Jung had to improve the company’s image by
implementing a celebrity factor via “going Hollywood” which encompassed the strategy
formulation. This meant representation of people such as Rese Whitherspoon, Fergie, and
Lauren Conrad. Another alteration was by introducing mark in the summer of 2003 which
implemented a strategy to capture a new customer base and by contouring a product line for
women age 16-24. Jung also adapted the visuals of the catalogs because they were made to
entice consumers through glossier paper and advertisements with a younger feel to them. The
new line of products were introduced for the novel brand. This made a new generation of Avon
costomers.
2. The performance measures that Avon’s strategic decision makers may use for evaluation of the
result remolding the company is to suit a more youthful consumer audience. The results of the
restructuring initiatives were appealing to a new market segmentation of a younger audience,
making brands more competitive, plus improving the attractiveness of the representatives’
earning potential. The feedback aided in making these changes. For instance, the company is
more aware of the lack of having a lower R&D sales than their competitors. Jung had to
streamline the company which meant layoffs, but it also meant outsourcing some services to
low cost countries, doubling advertising spending and simplifying the manufacturing structure.
Moreover, the amount of product innovation has been increased as well as the amount of
representatives. It meant reaching the targeted 17 million young women with the new products
catered to fashion and beauty.
3. Based on cnn.com, the top three companies are Sara Lee, Yahoo, and WellPoint. This was for the
year of 2011. The numbers have slowly increased over time and according to the Fortune 500
informational piece in the website, 15 of the 500 CEOs are women. Having women as CEO has
been a long journey starting with having women in the work place, period. One company, IBM
never before had a woman CEO but even that is about to change. The abcnews.go.com reported
that Virginia Rometty shall be the newest addition as acting CEO. There are other companies
following this path. For instance the website lists 18 out of the Fortune 500 compaies which
included DuPont, Xerox, Sunoco, Ebay, Hewlett-Packard, and Mylan, Inc have women CEOs. In
conclusion, what was drawn from the data is that having a woman CEO is still a scarcity and they
are still a great minority.
4. Avon’s vision and mission is consist of being “the company that stands for beauty, innovation,
optimism, and above all women” according to www.avoncompany.com. The statement affects
strategic decisions and actions because the company really researched how women perceive the
remodel of the company. It entered glossier, thicker paper, a younger line of cosmetics and a
Victoria Swann
Management Strategy and Policy
trendy yet stylish website. Celebrities such as Rese Whitherspoon, Fergie, and Lauren Conrad
adorn themselves with Avon’s products. Furthermore since Andrea Jung has been employed
with Avon, there has been a renovation of the company. The implementation of the changes to
cater to women 16-24 years of age had been established as well as remaining faithful to
previous consumers. She was also responsible for a multiyear restructuring which eliminated
jobs, doubled advertising spending and focused R& D’s resources. One of the brands endorsed
by celebrity Fergie is advertised as “Be the center of attention.” And it is the center of much
discussion because it is launched with its own website separate from the Avon site. It comes
with its own theme music and rules of conduct for the webpage.