Individual Leadership Plan Addendum, Essay Example

The Kimberly-Clark Tissue Company was purchased by Kimberly-Clark Corporation.The company manufacture and producestissue products such as napkins, paper towels, and toilet paper. “The previous name of the company was very well known as Scott Paper Company, however in 1996 the name was changed. The company has been in existence since 1879. The corporate office is located in Neenah, Wisconsin. Kimberly-Clark Tissue Company was formerly known as Scott Paper Company. Because of its acquisition by Kimberly-Clark Corporation, the name of Scott Paper Company was changed(Bloomberg BusinessWeek, 2014, pg.2).Kimberly-Clark is a global health and hygiene organization that products include personal care items such as Scott, Huggies, and Pull-ups. Kimberly-Clark has sold their product in more than 175 countries. They are headquartered in Irving, Texas. They have approximately 58,000 as of 2012(Kimberly-Clark, 2013).

Kimberly-Clarks Financial Model

The financial model of Kimberly-Clark Corporation has models they utilize in determining the financial validity of the company. The financial department for Kimberly-Clark provided a year to year financial model with a relatively conservation analysis for the 2013 to 2014 outlook. The model we are analyzing is the financial statements for 2010, 2011 and 2012 however, the company’s outlook for the future can also provide a closer look at their financial performance. According to Kimberly-Clark (2013)”, year over year, Kimberly-Clark has seen revenues remain relatively flat ($21.1B USD to $21.2B USD), though the company was able to grow net income from $1.8B USD to $2.1B USD. A reduction in the percentage of sales devoted to cost of goods sold from 66.16% to 65.52% was a key component in the bottom line growth in the face of flat revenues”. In between the numbers growth net income was an increased meaning for the stockholders Kimberly-Clarks financial position improved from the previous year. However, the expectations of percentage growth was anticipated to be a higher increase.

The summary of Kimberly-Clark Corporation indicates that part of the Kimberly-Clark financial models are looking the impact of global sales as a gauge to determine how well Kimberly-Clark is performing globally. According to Kimberly-Clark investor analysis, “Fourth quarter 2013 net sales of $5.3 billion were even with the year-ago period. Organic sales rose 5 percent, including an 11 percent increase in K-C International. Organic sales exclude the impact of changes in foreign currency exchange rates and lost sales as a result of European strategic changes and pulp and tissue restructuring actions” (Kimberly-Clark,2013). It is clear that the leadership of Kimberly-Clark weighs heavily the financial performance globally of the company to determine whether Kimberly-Clarks financial situation is profitable and growing. In reviewing financial model the ratio analysis found some interesting financial results. The activity ratio was computed as the total revenue divided by shareholders’ equity which is equity turnover. In 2011 to 2012 Kimberly-Clark Corp.’s equity turnover increased from 2011 to 2012. The activity ratio was computed as the total revenue divided by shareholders’ equity which is your total asset turnover. The total asset turnover did not perform very well going down from 2012 to 2013 but did perform better than 2011. The activity ratio was calculated as total revenue divided by net fixed assets. Kimberly-Clark fixed asset turnover improved from 2011 to 2012. (Stock Analysis on the Net, 2013, pg.2). The net sales for Kimberly-Clark for 2011 to 2012 increased, the operating profit increased from 2011 to 2012, and the income before taxes increased and net income attributable was increased. The financial statements show strong overall performance of Kimberly-Clark financial statements.

The CEO of Kimberly-Clark is Chairman Executive Officer Thomas J. Falk. The CEO analyzed the fourth quarter financial results with assured growth because Kimberly-Clark performance was increase each year. He state that the “fourth quarter results capped off another year of excellent performance for Kimberly-Clark. For the full year of 2013, we delivered organic sales growth of 4 percent, with 9 percent growth in K-C International and benefits from product innovations around the world” (Kimberly Clark, 2013). The leadership is consistent with the Kimberly-Clark overview of financial performance and the investor’s analysis of growth globally is the key to Kimberly-Clark’s financial performance. The financial prospectus indicates the past year success in percentage of growth meets the approval of CEO Faulk indicated that the primary success of the Kimberly-Clarks was the execution of the Global Business Plan. In addition, to pursing targetedgrowth initiatives that support growth opportunities. CEO Faulk expects to achieve high level of overall cost savings along with lucrative fund brand investments which will improve future margins.

The financial outlook for Kimberly-Clark has been noted by the investors as making the transition to technology that will make a real impact on the financials. The single most important fact is how quickly information can be sent and received to customers and vendors. At Kimberly-Clark their financial position did improved because some other positive moves such as investing in EDI Technology which plays an integral part in the connecting to its supply chain faster than the market. Kimberly-Clark has a centralized location that manages the transportation logistics through a service center. This central allows the company to send and receive real time information that helps them meet the needs of the consumers and vendors. As a result, Kimberly-Clark has the necessary information to cultivate the most valuable channels for circulation based on the individual products and customers.

The concepts that drive the operations also drive the financial results improvements such as Kimberly-Clark adopting lean principle. These principles when applied in manufacturing industry, the goal is clear to deliver the product faster and smarter. The financials can give you the long and short performance of Kimberly-Clark, however a close look at the changes can leader to more profits. The best example is Kimberly-Clark investing in logistics and EDI to eliminate waste while increasing the delivering of their products in real time. The outsourcing can contribute to improve financials because Kimberly-Clark can reduce cost by outsourcing some of the logistics instead of spending millions developing talent in a specific area. The benefits of outsourcing is Kimberly-Clark can mainstream some the processes that lead to improve financial projects.The development of faster ways to move the distribution channel from the United States to globally areas as put Kimberly-Clark in a financial position that can improved with lean cuts.

As a leader in paper products and technology gave Kimberly-Clark the right mixture of diversification that shows up on the balance sheet. The main point is Kimberly-Clark has master the art of logistics to the point the competitions are using the Kimberly-Clark supply chain. The supply chain and the EDI has move the product at Kimberly Clark so quickly that the controlling costs because the norm. In the globally business transaction Kimberly Clark explored outsourcing to ensure the bottom line would be lean while the manufacturing costs were under control. Kimberly Clark recognized a number of logistic enhancement probabilities concerning anoverhaul of the distribution center design to minimize the distribution channels. The increased capability to deliver more variety of services in less time than competitors will ensure that Kimberly-Clark stays at the very top of their industry.

Leadership Styles

Kimberly-Clark has strong leadership that has put a financial vision of extend global markets allowing Kimberly-Clark to lead the way for a better life around the world. Kimberly-Clark’s senior leadership has strategic direction that focuses on the continued innovation and importance of meeting the needs of customer base.However, Kimberly-Clarks leadership is more data-driven that leads Kimberly-Clark into years of non-competitiveness because they refuse to adapt the changing market. The leadership is rigid while not willing to make decisions unless the data determine the best decision. As result, upper management is far removed from what day to day decisions impact Kimberly-Clark leadership and internal culture. It isa repeat of Chryslers, who continue do the same thing because that was the why Chrysler did things. It was not until Lee Iacocca as the question” why are we doing this” the leadership answer because we were always told to do that way. Kimberly-Clarks need to understand their customers instead of delivering the same product each year without becoming more involved. In addition, the leadership and talent was becoming stale.

Kimberly-Clark should be more in touch with its women constituent which could increase sales. Kimberly-Clark must have been listening because they launch a worldwide campaign geared towards empowering women to use their products. The programs highlight the important role of women in the market. Kimberly-Clark created new strategies to bring a new culture from the business and college ranks to start building a futuristic company with more influential roles in the organization. Kimberly-Clark is heading in the right direction with the new women initiatives that has been launched. They have made the decision to start considering their customer needs and wants along with reaching out to millions of women all around the world to find out how they can improve their products. They are asking the right customer the right questions.

Recommendations Management Style

The management style of Kimberly-Clark has been filled with seasoned veterans that understand the industry. However, the management has become somewhat outdated because Kimberly-Clark has not brought in new innovated talent to ensure Kimberly-Clark stays competitive with a growing management team. The management styles are reflective in the choice of products that sometimes are delivered without thinking about the client. A strategic change needs to begin with Kimberly-Clark recruiting more at the college and universities to ensure they have the infusion of new talent. The HR department should be held accountable for making sure the organization is moving in the right direction. The organizations culture of management comes from the primary leaders that have been hired. The season veterans utilize the more direct in your face approach which is more rigid that the professional collaborative management methods used today. In order to developed new ways of managing the company should adopt a mentoring program that will help internally and in the community.

The management team has the opportunity to grow there people skills. A mentor cares about her mentee and goes out of her or her way to see that they get the best possible chance to fulfill their career potential. It involves teaching, coaching, and helping to build a high degree of confidence. Each leader will be required to take someone under their wing and teach them one-on-one over a period. The mentoring project includes teaching people as you leader others, follow others and exhibit all the habits of an excellent leader. We will require each leader to make a commitment to mentoring project. We understand that leaders showing confidence in another person can help that individual develop into a great leader. It is also an important leadership contribution, because you are helping to develop a person who has the potential to be leading years to come.

The human resource department should be involved with strategic change ensuring that Kimberly-Clark continues to promote, hire and advanced critical positions. The impact in the future with be different than in the pass with country adjusting to the new healthcare laws, it will be necessary for the company to do some future strategic planning for innovative talent. In light of Obamacare, the human resource management must begin preparing for the impact. The people will have the choice of which healthcare provider to choose for their families. As a result, the insurance companies have to find other ways to be profitable. The result is businesses need to prepare for their rates to increase. However, the strategic initiatives must include the HR department will be involved in all phases of hiring and advancement of key positions. The three trends that will affect human resource management in the next 10 years will be Healthcare changes for employees, obtaining the best talent, health, and wellness in the workplace.

Suggested Changes

Kimberly-Clark has put some much emphasis on the globally market to ensure they maintain a profitable outlook. In addition, to streamlining processing, EDI capabilities, improve distribution channels and outsourcing services to improve the real time delivery of the products. The primary change would be in the direction of their programs that are addressed as women. Kimberly-Clark has been featured as being stoic but steady without considering the client’s needs. The Kimberly-Clark based includes predominantly women, therefore the making of diapers and women’s product should consider the needs of the women. In the news, Kimberly-Clark Corp, has been quoted as saying that over 83% of their customers are females. This would make sense to make your primary customer priority.

References

Bloomberg BusinessWeek.(2014).Kimberly-Clark. Retrieved from http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?ticker=KMB

Kimberly-Clark. (2013). Kimberly-Clark Financials. Retrieved from Stock Analysis on the Internet. (2013).Kimberly-Clark. Retrieved from http://www.stock-analysis-on.net/NYSE/Company/Kimberly-Clark-Corp/Ratios/Long-term-Investment-Activity#Ratios-Summary