CASE STUDY: PROCTER AND GAMBLE’S LEADERSHIP TRAINING PROGRAM

Whether you realize it or not, there is a company that has quietly inserted itself into most aspects of
your day-to-day routine. To some it may seem like a soap and shampoo company but those that know
its past know that it has created the market that it now leads. It has ridden the wave of modern hygiene
to what it is today and is responsible for many of the consumable products you use every day in your
home. This company is Procter and Gamble. Originally founded by William Proctor and James Gamble
in 1837 as a soap company, P&G’s products really took off during the Civil War when it won contracts
with the Union army to provide supplies to its soldiers. Back then, most consumer products were made
using home remedies with recipes passed down for generations. P&G were the first to streamline the
process and to make brands with consistent ingredients. It was through this effort, that they effectively
invented branding as we know it.

With over $85 billion in sales and sixty-five brands in its portfolio, Procter and Gamble is the world’s
largest advertiser. They sell all types of consumer goods—from cleaning agents to razors. You may not
know it, but Gillette, Febreze, Vicks, and Olay are all P&G brands.

Today, Procter and Gamble products sell around the world (apart from North Korea and Cuba) and P&G
employs over 100,000 people. While it all started with soap, over the last 150 years P&G have created
new products by using out-of-the-box thinking. Before 2014, its portfolio included foods, snacks, and
beverages. However, since then, they decided to cut one hundred of their brands and kept the sixty-
five brands that made 95 percent of their profits. With this streamlining, we have the modern-day Procter
and Gamble.

As a leader in new and innovative products, P&G knew it would constantly need to reinvent itself in
order to keep up with the competition and meet the needs of consumers. If it only sold soap, it would
quickly have its business stolen away by another company making a newer kind of soap. According to
former chairman Richard Deupree, “The Procter & Gamble Company never has gone in circles, never
followed footsteps, but rather has continually broken new trails, entered new fields, set new records,
even raised its own high standards.”

P&G also adopted this mind-set in its approach to advertising. It knew that reinventing its product line
along with how it was presented would be crucial. For that reason, P&G is regarded by many as the
inventor of advertising as we now know it and seen as the first household name brand. Its desire to
advertise neatly coincided with the age of the newspaper and the rise of print advertising.

Along with being at the forefront of product innovation and advertising, P&G has also been a leader in
its field for product testing and the proper vetting of all its products. It set a standard for the importance
of safety, and even in the early days of mainstream advertising it made the safety of its product a huge
priority. Thanks to the early groundwork laid by P&G, consumers rarely have to worry about the safety
of cleaning products.
P&G has been the proud recipient of many awards, including being #1 on Fortune’s Global Top
Companies for Leaders or #15 for World’s Most Admired Brands. It is consistently ranked a top company
for its organizational culture, brand recognition, and leadership development programs. It has one of
the most efficient employee training programs of any major companies and prides itself on mentorship
and leadership skills even at entry level. As a result, P&G has become a very sought-after place to work.
Its leadership in the industry applies to everything it does, from how it treats its workforce to how it
manages its brand and its success shows no sign of slowing down.

Critical-Thinking Questions

1. Why does Procter and Gamble draw so many job applicants?

2. How did Procter and Gamble influence the creation of their industry as it pertains to safety?

Resources:

Burla, A. (2017). What is the corporate culture like at Procter & Gamble? How is the culture different than other
companies? Quora. Retrieved from https://www.quora.com/What-is-the-corporate-culture-like-at-Procter-
Gamble-How-is-the-culture-different-than-other-companies

Fisman, R. (2013). Culture clash: Even a merger made in heaven can get off to a rocky start. Slate. Retrieved from
http://www.slate.com/articles/business/the_enlightened_manager/2013/12/corporate_culture_clashes_what_man
agers_can_learn_from_the_rocky_first_days.html

Horowitz, A. (2011). How Procter & Gamble became the maker of EVERYTHING you buy for your house.
Business Insider. Retrieved from http://www.businessinsider.com/protor-gamble-makes-everything-2011-2

Marketplace. (n.d.). Procter & Gamble corporate history. Retrieved from

https://www.marketplace.org/2008/05/20/procter-gamble-corporate-history

P&G. (n.d.). Policies & practices. Retrieved from http://us.pg.com/who-we-are/our-approach/purpose-values-

principles

P&G. (n.d.). Who we are. Retrieved from http://us.pg.com/who-we-are/heritage/history-of-innovation

Smithson, N. (2017). Procter & Gamble’s organizational culture of mission fulfillment. Panmore Institute.
Retrieved from http://panmore.com/procter-gamble-organizational-culture-mission-fulfillment

This case study is from a textbook, “Organizational Behavior: A skill-building approach”, second edition, by
Neck, Houghton, & Murray.