L’Oréal L’Oréal is the world’s largest cosmetics company and

L’Oréal was found in July 30, 1909 in Clichy France by Eugène Paul Louis Schueller who is a young French chemist of German descent. Company’s headquarter is in Clichy,
Hauts-de-Seine and a registered
office in Paris. The guiding
principles of the company, which eventually became L’Oréal, were research and
innovation in the field of beauty, and now L’Oréal is the world’s
largest cosmetics company and has developed activities in the field of cosmetics, concentrating on hair colour, skin care, sun protection, make-up, perfume and hair care. Also, they
have several brands which keep within related with fine chemicals, health, finance, design, advertising,
and insurance. It can be said; L’Oréal owns more than 500 brands and thousands of
different products. These can be listed like that; Professional
products; L’Oréal Technique, L’Oréal Professionnel, Kérastase, Kéraskin
Esthetics, Matrix Essentials, Mizani, PureOlogy Research, Redken 5th
Avenue NYC, Shu Uemura Art of Hair, Carol’s Daughter, Carita, Essie, Decléor,
Botanicals Fresh Care. L’Oreal Luxe; Lancôme, YSL, Giorgio Armani, Biotherm, Cacharel, Diesel, Viktor &
Rolf, Ralph Lauren, Kiehl’s, The Body Shop, Shu Uemura, Clarisonic, Guy Laroche,
Paloma Picasso, Urban Decay, Maison Margiela, Yue Sai, Helena Rubinstein, Drakkar
Noir. Consumer products; L’Oréal Paris, Ombrelle, Garnier, Maybelline, NYX Cosmetics, SoftSheen-Carson,
Carol’s Daughter, Créateurs de Beauté, Essie, Magic, Niely Cosméticos, Coloram.
Active cosmetics; Vichy, La Roche Posay, Inneov, Skinceuticals, Roger, Sanoflore,
Dermablend. As a 2016 statistics, 89,300 employees from 156 different
nationalities work in there. Their revenue €25.837 billion and their assets value is €35.630
billion. In 1920, the company employed three chemists but
today nearly 20,000.  Jean-Paul Agon is currently “Chairman
and Chief Executive Officer” and here is the his team; Laurent
Attal, EVP Research and Innovation; Barbara Lavernos, EVP Operations;
Nicolas Hieronimus, President Selective Divisions; Brigitte Liberman, President
Cosmetic Active Division; Marc Menesguen, President
Consumer Products Division; Christian Mulliez, EVP Administration
and Finances; Sara Ravella, EVP Communication, Sustainability and
Public Affairs; An Verhulst-Santos, President Professional Products
Division; Jérôme Tixier, EVP Human Resources and Advisor to the
Chairman; Alexis Perakis-Valat, EVP Asia Pacific Zone; Alexandre Popoff, EVP
Eastern Europe Zone; Geoff Skingsley, EVP Africa – Middle East Zone; Frederic
Rozé, EVP of the Americas Zone; Geoff Skingsley, EVP Africa – Middle East Zone
and Johen Zaumsel, EVP Western Europe Zone. In 2017, L’Oréal was the leading personal care
brand in the world with
a brand value that amounted to 23.89 billion U.S. dollars. Between 2015 to
2018, the company’s compound annual growth rate increased
by 4.2 percent. L’Oréal’s consolidated sales
generated 25.84 billion U.S. dollars. Their prediction for 2024 is that
reaching 180 billion U.S. dollars in size of the market.
On
the other page, we can see a map about L’Oréal company’s locations around the
world. It is a really huge and complex company.

 

           This semester, we worked on
L’Oréal company structure and management. Our project’s theme is analyzing that
company how its internationalization is reflected in its organizational design,
and compare it to the structures of international companies. When we researched the
organizational structure of L’Oréal company, company’s structure seems as geographical
structure, because company has full control of functional activities within its
geographic area. We thought that this should be examined under the global
geographic region but then we realized that with helping our lecturer Prof.Dr
Sükrü Ozen, this should be examined under the matrix organization. At that
point first of all we need to answer for this question; what is global
geographic structure? and what is a matrix organization? The global geographic structure divides
the world into geographic regions, with each geographic division reporting to
the CEO. Each division has full control of functional activities within its
geographic area. Companies that use this type of structure have typically been
those with mature product lines and stable technologies. They can find low-cost
manufacturing within countries, as well as meet different needs across
countries for marketing and sales. We focused on a lot geographic structure. However,
in some sources we find, we have seen clues that this company might be a matrix
organization. Because
L’Oréal company was concerned as far as regional management, the products were
divided into classes. We have found that the results of our research that these
two networks (geographic region and product) are also of advanced quality, made
us think that the matrix would be more suitable for this case, after the
presentation. When an organization’s structure needs
to be multifocused in that both product and function or product and geography
are emphasized at the same time, one way to achieve this is through the matrix structure. That means this company
cares about product departmentalization and region departmentalization. The
matrix can be used when both technical expertise and product innovation and
change are important for meeting organizational goals. The matrix structure often
is the answer when organizations find that the functional, divisional, and
geographic structures combined with horizontal linkage mechanisms will not
work. The matrix is a strong form of horizontal linkage. The product managers
and functional managers have equal authority within the organization, and
employees report to both of them. Actually, the matrix organization answers rapidly
real-world needs. This could be about capable of managing or customer service
or project whatever. That companies are very large and complex areas. The
matrix can provide easy access to the result at this point because each
department is highly specialized and interconnected at the same time by a
horizontal connection. The intra-company communication network has evolved so
much. It is clearly known that, the classic hierarchical management
organization could not cope with the added complexity and the enormous amount
of information that had to be processed, and conventional management theory was
of little help in solving these new and unique problems. Individual functional
departments have great difficulty in solving very large problems because of a
failure to view the total system and a tendency to sub-optimize or solve the
problem within their particular discipline.  This problem caused major troubles in
companies.

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Therefore, the preferential reason for adopting the
matrix in a large organization can be pinpointed in the fact that functions and
skills are fragmented throughout the organizational structure.