L’Oréal Research and Development Strategy

Résumé du document

L'Oreal is a well-known firm for its strategy focused on organic growth. The group has concentrated its efforts for a long while on the development of its own brands by undertaking a few targeted acquisitions. To acquire new competences, a large confidence is granted to the R&D centres present in France, in the US, in Japan and in China. Its "technology acquisitions" are almost entirely implemented in these centres. Alliances with other firms are also very rare. We will analyze the one with Nestle on Galderma.

Research became the base of the system of L'oreal as soon as the foundation of the firm was established. The scientific principles of Schueller and the devotion to the needs of the consumers have remained very strong. This spirit has maintained scientific training over the years by mainly two of the four CEOs of the company, that is to say, Francois Dalle from 1975 till 1984 and Charles Zviak from 1984 till 1988. Impulsion was therefore given historically in the highest level of the society. Even if it was certainly less with Owen-Jones whose strategy was largely focused on marketing, the latter maintained and even developed the R&D efforts of the company.

Extraits

[...] L'Oréal Research and Development Strategy Introduction L'Oreal is a firm well-known for its strategy focused on Organic Growth. The group has concentrated its efforts for long on the development of its own brands doing few targeted acquisitions. To acquire new competences, a large confidence is granted to the R&D centers present in France, in the USA, in Japan and in China. Its “technology acquisitions” are almost entirely implemented in these centers. Alliances with other firms are also very rare. We will analyse the one with Nestlé on Galderma. [...]

[...] This laboratory is backed by a large number of academic institutions to encourage the search in the way of the scientific study of the genetic differences between races. For example, the black skins get old later than the white skins and the dark hair grow faster than the hair of Indos- european people. So, the laboratory has for vocation to concentrate at first on the study of skins and dark hair and will evolve then in the study of skins and hair of the other races. [...]

[...] L'Oréal communicates a lot on this strategy in order to give to the public the image of a strongly innovative company. A Research implemented worldwide L'Oréal created several centers fully integrated in the group all over the world: 10 in France in the United States in Japan and 1 in China[1]. These sites gather chemists, biologists and pharmacists, that is all in all 3075 people working for progress the cosmetic and dermatological research. Source: http://www.loreal.com In 2004, L'Oréal decided to withdraw from the pharmaceutical domain to refocus on its main activity, the cosmetic. [...]

[...] LETESSIER Nouveaux marches : le plan d'attaque pour séduire 150 millions de jeunes chinoises Capital, juin 2003. R.E., 2000 formules nouvelles sortent chaque année des laboratoires du groupe L'Oréal Les échos, supplément international janvier 1998. [...]

[...] The success of Galderma has thus been ensured thanks to the common contributions of the two companies. Specialized in medical dermatology, the company employs 2200 peolpe worldwide today. Galderma is specialized in the treatment of the cutaneous diseases, the hair and the nails (acne, eczema, mycosis, rosacea, alopecia), and invests of its turn out in 2007 in Research and Development in its laboratories of Sophia-Antiopolis, Princeton and in Japan. ) These investments in R&D are one of keys of the growth of Galderma. Three R&D centers insures the discovery and the development of new therapeutic solutions. [...]