Fundamentals of Human Resource Management 5th Edition by Raymond Noe, John Hollenbeck, Barry Gerhart, Patrick Wright

Exercise 12

P G's Purposeful Growth
Procter Gamble is famous for its brands of household products, including Tide, Pampers, Gillette, and Head Shoulders, sold in more than 180 countries. Since the company's founding in 1837, it has been admired for its marketing creativity. But since Robert McDonald became chief executive officer in 2009, P G has sought greater success built on a sense of purpose.
McDonald wants P G's employees to be unified by the company's Purpose Statement: "We will provide branded products and services of superior quality and value that improve the lives of the world's consumers, now and for generations to come." Implied are commitments to quality and sustainability. This purpose assumes that when P G meets those standards, consumers will see value and buy from P G, thus rewarding the company and its shareholders for doing the right thing. In a nutshell, P G is aiming for "purpose-inspired growth."
To get employees dedicated to the vision of purpose-inspired growth, P G urges them to think about how P G can "touch and improve more consumers' lives in more parts of the world … more completely." The company is especially interested in what this vision can do in high-growth developing nations. When employees think about how consumers' lives can be improved in India or Brazil, they are helping people while opening up huge areas of new growth.
In India, P G employees noticed that when men needed a shave, about half would go to a local barbershop. Often, a barber would save money by taking double-sided razor blades and breaking them in half, so they could use them for twice as many shaves. Then they would use the same blade on as many customers as they could. As a result, the customers risked infection. P G responded by analyzing razors to identify their most essential features, creating an ultra-simple razor, and figuring out how to produce it at minimal cost.
In West Africa, P G established a purpose-related performance measure: Each employee is graded on how many lives P G has touched. One effort aimed at this kind of performance was creation of Pampers mobile clinics. To improve infant mortality rates and health, these vans, each staffed with a physician and two nurses, travel around the region. At every stop, the professionals offer baby checkups, lessons in postnatal care, and referrals to local hospitals for follow-up care and immunizations. Mothers can sign up for mVillage, a program that sends text messages with health tips and answers to their questions. (In West Africa, even many poor people have cell phones.) Finally, each mother receives two free Pampers diapers. The experience of serving the community gives P G employees a sense that their work is making life better for families even as West Africa becomes one of P G's fastest-growing markets.
This goal-directed behavior is not just warm and fuzzy; the company is quite serious about performance management. Each employee has a personalized "cockpit," a display on the employee's computer screen that shows the employee's goals and a range of tolerances for each goal. If the employee's performance veers outside the tolerances, then the computer issues an alert. Employees and their managers are expected to investigate any discrepancy to find out what must change for the employee to meet his or her goals. The constant monitoring and feedback lets the company react quickly, rather than waiting for a quarterly or annual review to find out that, say, the employee lacked necessary resources, or goals were too pessimistic.
A related HR challenge for P G is to find and keep people with the necessary technical skills. To ensure that the global giant is staying up-to-date on techniques for analyzing data, P G's chief information officer tracks talent needs in terms of the essential technical skills-for example, knowledge of computer modeling and simulation. Executives also identified the computer and analytic skills required at each level of the organization, so talented people can receive the right training to advance. That's essential for a company that prides itself on promoting from within. All of its CEOs started out as entry-level workers, and management development routinely includes a stint running operations in a foreign nation. Finally, in China, the company established an R D facility. The goal is to position the company to recruit from China's growing ranks of scientists and engineers, who can provide a close-up perspective on consumers' needs in Asia.
What other trends described in this chapter could help P G meet its goal of purpose-inspired growth? How could they help?