WHAT IS OUR OPTION CONCEPT?

• P&G is looking to make their Global Business Services unit (GBS) more
cost efficient by shifting the operation of the unit using 1 of 4 options
• Option 4 is to keep the unit “In-House”
• This option would entail continuing the unit as it has existed previously: operated
from within P&G’s organizational structure and control
• Will allow the organization to further explore potential cost savings options that
may come from keeping the GBS unit in house
• Will disrupt the work of the unit the least of the 4 options (least amount of
change)
PROS OF OUR OPTION

• Least disruptive option in terms of human capital

• Company culture stays unchanged
• Continues to hold high reputation amongst employees
• Even though in early stages, showed millions in early savings
• No need to share internal information
CONS OF OUR OPTION

• GBS is not one of the focal services or functions provided by P&G,

though it is a pivotal function for its business operations
• As the organization grows, the In-House GBS team will not receive
the funding or attention necessary to keep them running at the
same proportional efficiency rate they have currently
CONS OF OPTION 1:
“SPIN-OFF”

• Greater administrative cost

• Separate board review
• Cannot unwind
• Can be bought like any other company
CONS OF OPTION 2:
“OUTSOURCE TO ONE LARGE VENDOR”
• Will force the organization to negotiate jobs for the entirety of the
5,700 employee GBS unit team or let them all go
• Movement, if negotiated, will cause unforeseen amounts of stress and
demotivation among the team
• P&G is one of the largest organizations in the world
• There are not many organizations in existence that can handle employing and
relocating the entire GBS team at a more cost efficient level than currently
output
• Finding an organization that would contractually obligate themselves to 5,700
employees will be a major difficulty
CONS OF OPTION 3:
“OUTSOURCE TO MULTIPLE VENDORS”
● A large company may be too large for outsourcing companies to
take on such a large task.
● Data is being shared so both companies are at risk of a data breach
● Lose control of operations and deliverables of a project
● Employee morale decreases - P&G wants to retain an employee first
culture
SUMMARY:
WHY THE “IN-HOUSE” OPTION IS THE BEST
• GBS outsourcing deal was estimated at $7-8 billion over 10 years, by far
the largest outsourcing deals ever struck in the new BPO industry
• Governance team feared such a risky deal. GBS services offered critical
functions for P&G’s operation
• Though the organization runs the risk of have the GBS services fall behind
the rest of the organization, the opportunity for In-House improvement and
further cost savings offsets the potential to keep it running under the risk of
demotivated employees, loss of data in transfer, or lag time due to
movement to and outsourced organization
QUESTIONS?