Market capitalisation: pounds 32.6bn
Turnover: pounds 29.04bn in 1998
Pre-tax profit: pounds 3.3bn
Main businesses: Unilever is a prominent player in its traditional detergents and margarines businesses, but over the past 70 years it has also expanded into a wide range of foods, including ice-cream, tea, and frozen foods as well as developing businesses in household cleaners and deodorants and other aspects of personal care. Among its many famous brands are Omo, Persil and Radion washing powders, Flora and Blue Band margarines, Brooke Bond PG Tips and Lipton teas, Birds Eye frozen foods, Dove soap, Clavin Klein cosmetics, Vaseline skin care and Jif household cleaner.
Key executives: Niall FitzGerald, chairman of the UK side and vice-chairman of the Dutch business; Antony Burgmans, chairman of the Dutch business and vice-chairman of the UK operation; Clive Butler, Director Home & Personal Care; Alexander Kemner, Director Foods; Patrick Cescau, Financial Director
Number of employees: 270,000 in 50 countries
Niall FitzGerald is not having a happy anniversary year. The UK chairman of Unilever, the Anglo-Dutch Persil-to-Wall's ice-cream maker, should have been celebrating the company's 70th birthday with something more than just the publication of Licks, Sticks and Bricks - A World History of Ice Cream. Instead, the disappointing third-quarter figures earlier this month sent the shares diving 14 per cent, with the price languishing around a 12-month low since. If that was not bad enough, Unilever's recently- announced strategy decision to slash its 1,600 brands to a mere 300 to 400 "power brands" has failed to win over impatient City sceptics who see its arch rivals, Procter & Gamble and Colgate-Palmolive, doing significantly better in the marketplace.
But 53-year-old Mr FitzGerald is no stranger to pressure. The Unilever veteran was head of the division in 1994 which launched the Persil Power soap powder variant that was later said to damage clothes as well as clean them. He fought off the flak, and got the job as UK chairman in September 1996, when Unilever imposed a streamlined senior management to make the company more effective and forward-looking. Rebuilding City and investor confidence is now the most serious challenge for Mr FitzGerald and his Dutch counterpart, Antony Burgmans.
Competition is increasing for this sprawling multinational that employs some 270,000 people in 50 countries. "The world is changing at a great pace," says Mr FitzGerald. He finds that "one of the most difficult things to get a real grip on" is the idea that, in many of the industries in which the company is involved, important developments are happening on the periphery somewhere. "We have to be very aware of that and turn it to our advantage."
Sounding more like a man running a high-tech startup than a potentially unwieldy multinational, the chairman sees his own role as being to "shake up the status quo" rather than to be part of it. He wants to encourage some "anarchy", adding that, in a world where "no product, no person, no process" is sacred, an important part of his job is to challenge constantly. The UK chairman has persuaded senior executives to get out and meet real consumers. He has also set up a Foresight Group that involves rising managers investigating the effect of future trends on parts of the business. "Remuneration is now much more aligned with performance," adds Mr FitzGerald, whose own 1998 total package was pounds 1.1m.
The Irish-born Mr FitzGerald, who likes to jog to work from his Chelsea home and plays jazz and opera in his office, acknowledges that this management strategy is a far cry from what many will have been used to in a company still widely seen as comfortable and bureaucratic. He makes no apologies. Some people respond well to the new reality, but those not so enthusiastic are likely to have "less of a future in the business", he says darkly.
But apologies are in order for the latest set of financial figures, which put the skids under the share price when they were published on 5 November. Pre-tax profits came in at pounds 868m for the third quarter of 1999, compared with pounds 1.08bn in the comparable period last year. Turnover rose 2 per cent to pounds 7.07bn. Even the following week's stock market rumours of a link-up with Gillette, the US-based maker of razors and other personal care products, could not revive the shares.
One analyst says much of the bad sentiment stems from the US market, which has historically had an important effect on the company's share price. Fund managers there arrived at their desks to find a recording of the results announcement and to see the shares already on the slide - and accordingly reduced their positions.
Even those who believe the price slump was exaggerated feel the company did not handle the setback well. "The investor relations side has got to be looked at," says an analyst at Investec Henderson Crosthwaite, pointing out that Unilever's traditional and, at present, more highly-rated rivals Procter & Gamble and Colgate-Palmolive tend to be more precise in such financial presentations and to use them as marketing opportunities.
Mr FitzGerald, though clearly irritated that so much can apparently ride on one quarter's performance, acknowledges difficulties. "We have to be clearer about communicating what we're setting out to do over the long- term, and how that will create value," he says. He also sees the need to give investors "milestones against which they can measure us".
The decision to focus on up to 400 "power brands" is "part of a continuum" designed to make the company more focused and more fleet of foot. No decisions have been made about which brands will win out, but Mr FitzGerald says the change is not all about backing global brands; strong national brands such as Persil are likely to remain. The reduction will take up to four years and help make "much more efficient use of the marketing and R&D spend". Instead of having to spread support around a range of often very similar products, the company will concentrate on clusters of winners.
To a certain extent, this strategy is simply a drastic widening of ideas already implemented within the group. This year, Unilever introduced a global over-arching brand for all its ice creams, which stressed the product family and saved money by ceasing the need for separate packaging for each country. The performance of personal care products has also improved by paring he number of core products from hundreds to 25 - and now to 15. In taking these dramatic steps, Mr FitzGerald and his colleagues are also following a fashion. Groups such as Nestle, Diageo and Procter & Gamble have been culling brands not seen as absolute or potential market leaders. But, though this seems to be good business sense in the longer term, analysts warn that investors will see a shortfall in sales volumes before the benefits in terms of improved profits start to come through.
Unilever is also trying to simplify its many overseas operations by reducing the number of joint ventures and shortening the lines of command. The challenge here is to maintain the difficult balance of being a "multi- local multinational".
The company has always liked to boast that "unlike its competitors, Unilever is international by birth and by design". After its creation in 1929 through the merger of Lever Brothers, a soap manufacturer based near Liverpool, and the Dutch margarine and oils company Margarine Unie, it spent the next 60 years expanding into a multitude of products and markets, building a labyrinthine management structure along the way.
Over the past decade, the range of activities has been reduced, first by the disposal of most service and ancillary businesses in the mid-1980s and then in the 1990s through the sales of the packaging companies and most of the agribusiness. Specialty chemicals was sold to ICI for $8bn in 1997. This left home and personal care, and foods.
At the same time, the company embarked on an acquisition spree designed to bolster its position in those key areas. As a result, Brooke Bond tea joined the fold in 1984, and the 1987 purchase of the US personal products group Chesebrough-Ponds paved the way for the later arrivals of Faberge/Elizabeth Arden and Calvin Klein fragrances. Between 1992 and 1997 there were more than 100 acquisitions in sectors ranging from hair-care to ice cream. But this has not meant Unilever can prevent competitors trying to muscle in on its territory. Another reason for the worse-than-expected recent third-quarter results was that it had had to spend pounds 40m trying to see off a challenge from Procter &Gamble to its Latin-American detergent market. Mr FitzGerald says the company will continue to defend such market positions because the expense is minimal compared with the profits at stake.
Closer to home, Unilever has been subjected to five investigations in seven years by competition authorities looking into complaints about its ice-cream distribution business. It is also facing more general competition issues resulting from the move to a single European market.
These changes will cause difficulties for Unilever. But Mr FitzGerald is a prominent proponent of the single currency, saying it is the means of achieving a true single market. He believes any discomfort will be justified by the prize of creating an economic block to rival North America.
Investec Henderson Crosthwaite is forecasting a small drop in profits for the full year, from more than pounds 3bn last time to pounds 2.79bn. But they say that if the company can execute its plans successfully, the shares could double over five years.
Mr FitzGerald realises he has to roll out a strategy against constantly shifting conditions. He warns his colleagues of the importance of keeping up changes to the way products are sold and used, and of staying in touch with consumers, who can be a lot more unpredictable than the average versions in market research reports.
He says: "With every decision we make, the last question we must ask is, `What does the consumer think of this?' because the consumer dictates whether we're in business or not."
A quick spin through the history of unilever, the washing powder Giant
1929: Created through the merger of the Lever Brothers' detergents business and the Dutch company Margarine Unie. The link was that animal fats were the raw materials for both margarines and soaps
1930: The economic slump hit all aspects of business, including the buying and processing of more than a third of the world's commercial oils and fats
1940: During the Second World War, helped make tank periscopes and soldiers' rations
1950s: Increased spending on research and development in response to the appearance in the US of synthetic detergents. The company moved into chemicals, packaging, market research and advertising.
1960s and 1970s: Vertical integration accompanied expansion into new markets
1980: By now, soap and edible fats, which had originally accounted for 90 per cent of profits, contributed just 40 per cent of total. Similarly, 40 per cent of profits were coming from overseas, twice the level in 1930. Company further diversified into frozen foods, householder cleaners and cosmetics, and used its historical connections with countries around the world to make early inroads into emerging markets.
1980s: Extensive restructuring, with non-core operations disposed of to create the key divisions of foods, detergents, and personal care
1992: A five-year programme of targeted acquisitions starts, with 100 purchases by 1997
1996: Biggest management shake-up in company history
August 1999: Marks its 70th anniversary with the publication of `Licks, Sticks and Bricks - A World History of Ice Cream'Reuse content