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Team Project
Wayne Patterson, Tammy Runnion, Rachel Johnson & Catherine Garcia
Rasmussen College

Author Note
This research is being submitted on December 2, 2012, for Tom LeNeau’s B233/MAN2021 Section 05 Principles of Management course.

This summary will discuss the information that team 3 has retrieved from annual report of Philip Morris International. The annual reports we obtained shows the management changes and how the four functions of management have improved the operational efficiencies of Philip Morris International. All of the information in this summary, will be interesting to management students and managers.
On March 28, 2008, Louis C. Camilleri became the Chairman and Chief Executive Officer of Philip Morris International. This happened following the spin-off of Philip Morris International from Altria Group, Inc. prior to this, he had been the Chairman and the Chief Executive Officer of Altria Group Inc., since 2002. He had previously served as Altria Group Inc.’s Senior Vice President and Chief Financial Officer since November 1996. Camilleri joined Philip Morris Inc. in 1978 as a Business Development Analyst with Philip Morris Europe. Prior to joining Philip Morris International Inc., Camilleri was a Business Analyst with W. R. Grace & Co., in Lausanne, Switzerland. Louis received a degree in Economics and Business Administration from Lausanne University in 1976 (Philip Morris International, 2002-2012).
Louis C. Camilleri is a person of significance to use for this project; he is the Chief Executive Officer of Philip Morris International and has held other various positions in Philip Morris International.
In 2009, as Chairman and CEO of Philip Morris, Camilleri wrote a shareholders letter that reflected on 2008 performance and it also included several examples of the four functions of management.
Philip Morris used the planning function when the company decided to break away from Altria. The action taken by Philip Morris brought several benefits that had an immediate impact. One of the benefits of this was an improved focus on varied market dynamics, competitive frameworks, challenges and opportunities. The elimination of Altria and the management structure has also nurtured faster decision making and a more optimum and efficient capital allocation, coupled with greater financial flexibility (Camiller, 2008).
A benefit of controlling and leading was increased net revenues, “excluding excise taxes, reached $25.7 billion, which was up $2.9 billion or 12.7% versus 2007, and up $1.3 billion or 5.6% on an organic basis, which is excluding acquisitions and currency, representing the high end of our long-term, constant currency target growth rate of between 4% and 6%” (Camiller, 2008).
In 2009 Philip Morris international kept changing and management evolved. According to the 2009 annual report, there has been extensive progress as PMI continued to nurture the management talent pool and the future leadership. The appointment of several new members of the Senior Management Team at Philip Morris has energized the entire organization (Camilleri, 2009).
Philip Morris is proof that companies do use the function of organizing in management. The management team continued to evolve with the addition of Jennifer Li to the Board in 2010. Li was praised both internally and externally. She brings strong financial expertise, experience in a fast-growing, high-technology business, and an Asian background that have further strengthened the Board’s depth and global perspective.
The use of the four functions of management are shown to have a benefit as the leading function was in play when Philip Morris set a three year productivity target and met it. In March 2008 the target of $1.5 billion in gross cumulative savings was set. It was finally achieved in 2010, due in large measure to numerous initiatives pursued in both procurement and manufacturing (Camilleri, Louis C., 2010).
Looking at the 2011 annual report, Philip Morris was using the leading function by setting a productivity target of $250 million for 2011, which the company surpassed (Camilleri, Louis C., 2011). Philip Morris also took other numerous actions in 2011 to enhance the organizational effectiveness of the company. The evolution of management was apparent as Philip Morris appointed three new members to the Senior Management Team. By doing so, the function of organizing was in play and the management team was significantly enhanced.
Management at Philip Morris in 2011 changed yet again with the addition of the services of both Kalpana Morparia and Robert Polet as new Board Directors. Kalpana’s significant understanding of the financial services industry, and Robert’s considerable experience in the global luxury and consumer packaged goods industries, will undoubtedly add further force to what constitutes an already formidable Board at Philip Morris International (Camilleri, Louis C., 2011).

References
Camiller, L. C. (2008). 2008 Annual Report. New York: Philip Morris USA.
Camilleri, L. C. (2009). 2009 Annual Report. New York: Philip Morris International.
Camilleri, Louis C. (2010). 2010 Annual Report. New York: Philip Morris International.
Camilleri, Louis C. (2011). 2011 Annual Report. New York: Philip Morris International.
Philip Morris International. (2002-2012). Our Management. Retrieved from Philip Morris International: http://www.pmi.com/eng/about_us/our_management/pages/our_management.aspx

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