Renewing Unilever: Transformation and Tradition (review)

A commissioned study, Renewing Unilever analyzes the history of one of the world's largest and, arguably, most important multinational enterprises in the years after 1965. Primarily a manufacturer and seller of branded, non-durable, consumer goods, Unilever produced items that could be found in about one-half of households globally by the early twenty-first century. Picking up where earlier histories of Unilever by Charles Wilson ended, Geoffrey Jones very ably tells the story of Unilever's recent activities. He divides his volume into two parts. In the first section, which composes about one-quarter of the text, Jones describes the growth of the company between 1965 and 1990 (and a brief epilogue brings the story into the twenty-first century); in the second, he tackles functional issues, from marketing to research and development, running through the firm's recent history. Loosely linking the various parts and chapters is the notion of Unilever as an increasingly knowledge-based company.

In part one, Jones looks at how Unilever's strategies for growth and its organization changed from the mid-1960s into the early 1990s. Several themes permeate this section of the book: how Unilever's officers sought to achieve balance between centralization and decentralization in their company's far-flung activities; how they tried to build organizational structures appropriate for those activities; and how they sought to bolster profits. Unilever was company only partly in control of its destiny, a business searching for its identity in a rapidly changing world. Jones begins by glancing back at the origins of Unilever in the 1929 merger of the British firm of Lever Brothers with the company Margarine Unie of the Netherlands. From that merger came the unusual management structure of Unilever: its rule by a troika of executives—the chairman of the British part of the firm, his Dutch counterpart, and a third person appointed by the Board of Directors. From the merger also dated the diverse operations of Unilever, including substantial activities in Africa, the source of raw materials for some of its products. Into the early 1970s, Unilever "continued to seek growth in new products and activities, both through innovation and by acquisitions" (p. 21). How to control their widening agglomeration of products led Unilever's managers in the direction of centralization. Between 1974 and 1984, Unilever faced "a dramatic deterioration in the world economy," to which it responded inadequately, making these years "a decade of lost growth" (p. 54). From 1984 into the early 1990s, however, Unilever "embarked on a transformation," which Jones judges to have been largely successful (p. 88). The firm's officers defined their company's core competencies as being mainly in food, laundry detergents, and personal-care items—until by 1990 the share of Unilever's core products accounted for 90 percent of the company's sales. As had been hoped, profits rose until they reached levels of benchmark firms such as Proctor & Gamble.

In the second part of his volume, Jones examines the functional development of Unilever, devoting individual chapters to the firm's work in marketing and brands, its very extensive activities in developing nations, its non-core operations (trading, plantations, and chemicals), its important emphasis on the long-term development of human resources (one of the firm's greatest strengths), its evolving corporate culture, its research and development efforts, its methods of handling acquisitions and divestments, and its corporate image (including a close look at how Unilever's officers dealt with labor and environmental matters worldwide). All of these topics deserve attention by readers of this volume, but chapters 5 and 6, which examine marketing matters, stand out as particularly valuable to me. How Unilever developed its brands (and made some mistakes in trying to do so) in global markets and how the firm sought to reach workable balances between the centralization and decentralization of marketing operations are especially intriguing. Anyone interested in the history of consumerism worldwide should read those chapters carefully. I have recommended them...