Andrea Jung and the Turnaround of Avon Products


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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

Case Details:

Price:
Case Code : LDEN035 For delivery in electronic format: Rs. 400;
For delivery through courier (within India): Rs. 400 + Rs. 25 for Shipping & Handling Charges

Themes

Leadership and Entrepreneurship, Women CEOs, Women Business Leaders
Case Length : 15 Pages
Period : 1999-2005
Pub Date : 2005
Teaching Note : Available
Organization : Avon Products Inc.
Industry : Cosmetics
Countries : USA

Abstract:

Avon was one of the prominent direct sales companies in the beauty products industry. Started in the late 1800s by David McConnell, the company sold a wide variety of beauty-related products to homemakers through its direct sales agents. However, by the 1980s, the company had lost its luster and performance began to falter. A failed diversification strategy made it the target of several takeover attempts. Turnaround efforts were initiated in the 1990s under then CEO James Preston and continued by his successor Charles Perrin, however, they failed to make a significant impact. Performance began to improve only after Andrea Jung became the CEO of the company in 1999. This case discusses the revival of Avon under Andrea Jung.

Jung was a retail industry veteran, who joined Avon as the head of US marketing in 1994. She was reportedly attracted to Avon's women-oriented culture. She grew rapidly within the company and was eventually made the CEO. When she became the CEO of Avon in 1999, the company was in a bad condition. Jung then took a head-on approach to reviving the company's businesses. This case details Jung's game plan for turning around Avon and explores the various steps she took towards this end including, changing the company's product strategy, reviving its sales representatives, exploring new channels of sales, aggressive global expansion, cost-cutting initiatives and an image makeover. By 2004, Avon's performance was a vast improvement from the 1990s and Jung was widely credited with the company's turnaround.

Issues:

»  Career of a successful woman CEO.

»  Strategy adopted by a woman CEO in turning around a large, global beauty products company.

»  Challenges faced by women business leaders in their rise to the top. 

Contents:

  Page No.
Andrea Jung in Fortunes List  1
Background  2
Early Career at Avon  3
Jungs Game Plan for Avon  4
Being a Woman CEO 11
Looking Ahead 12
Exhibits 13

Keywords:

Andrea Jung, Avon Products Inc., Women in Business, Woman CEO, Leadership, Duracell, 'Avon Lady', Turnaround Management, Jack Welch, General Electric, Product Development, 'beComing', S&P Equity Group, Avon Beauty Center, JC Penney, E-Tailing, Supply Chain Restructuring.

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