Cover Story -- The Best Managers

JOHN PEPPER

Two years after stepping up in the middle of a controversial restructuring, JOHN PEPPER, CEO of Procter & Gamble, is enjoying a big payoff. Pepper, 59, has simplified marketing and product development, trimmed wasteful ad spending, and plowed the savings into lower prices. Growth in China, where sales have hit $1 billion, has partly offset weakness in Germany and Japan. With profits up 12%, to $3.4 billion, for the year ended last June, shares have more than doubled, to 80, under Pepper.