Sustainable Supply Chains for Procter and Gamble Company PDF

Sustainable Supply Chains for Procter and Gamble Company 1
SUSTAINABLE SUPPLY CHAINS FOR PROCTER AND GAMBLE COMPANY
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Sustainable Supply Chains for Procter and Gamble Company 2
Introduction
Procter and Gamble remains to be an organization that deals with the production of
diverse products. Its ambition is to be capable of reaching different demands of its targeted and
esteemed consumers. In the operations of Procter and Gamble (P&G), sustainable supply chains
relate to the business factors that affect its activities that deal with supply chain or networks of
logistics operations regarding environmental, dangers of services, together with costs of waste
(Review Editor 2016, p. 112). Therefore this cases study explores Procter and Gamble’s journey
towards attaining a sustainable supply chain in its operations. The company remains to be
recognized as well as verified firm by many business stakeholders as the firm sustainability
player. It has also received various certifications awarded to its operations by independent
organization s in the sector of corporate sustainability. Moreover, the company has been putting
extra effort towards its long-term vision 2020 while pursuing essential initiatives that help its
management to address social issues along with environmental concerns while it successfully
aims at fulfilling its economic objectives (Wasserman 2011, p. 17). This case study explores the
historical timeline of operations of P&G that is essential in evaluating the progress that has been
made in the process of adopting business sustainability in its chain of supply. The research aims
at analyzing different outcomes from the sustainability culture along with assessment by
leadership survey that aims at providing the perspective of employees about sustainable supply
chain culture of P&G (Scott 2011, p. 23). Therefore, the primary target of this case study work is
to examine how Procter and Gamble Company has been capable of making progress and adapts
during the challenging path towards sustainable development of its operations.
Theoretical positions

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For the last decades, P&G has remained to commit its operations to create the appropriate
environment that comprises of social and environmental targets in their business conduct.
Despite the presence of these consistent efforts for sustainable supply chain at P&G, in early
days of 2013 and 2014, different media platforms repeatedly recorded that the company along
with several other organizations were able to source palm oil from various suppliers connected to
widespread devastation of the forest. The activity of sourcing the basic martial for operations of
the company was done with the motive of developing land for plantations of palm oil. Tsing
(2016, p. 34) recorded that the company’s sourcing plans expose its supply chain management to
forest fire outbreaks and destruction of habitats. Such diverse effects named it possible for the
organization that deals with well being of the forest, Greenpeace to commence its investigation
on company’s supply chain for more than a period of twelve months (Laflev and Martin 2013, p.
5). The investigative team found out that the orangutan habitat in the forest was being cleared in
the plantation connected to supply chain of P&G.
Ideal management of supply chain by P&G has made it remain as the leading
manufacturer of consumer products around the global community. It also announced another
successful operational year in their annual documentations with net sales of approximately sixty-
five billion dollars (Lehrer 2010, p. 38). As expected for the conglomerate of their functional
size, the company has the enormously complex chain of supply of its activities with many
researchers reporting that in early days of 2015 the company had established at least seventy
thousand suppliers around global community. Besides, P&G has managed to continue as
organization leader for nearly two centuries by involvement in the operations that deal with re-
evaluating and innovating new ideas for its services (Cincinnati 2012, p. 11). For instance, back
in days of 2015, the company efficiently overhauled their supply chain by saving approximately

Sustainable Supply Chains for Procter and Gamble Company 4
one point two billion dollars on charges of operations by improving visibility throughout the
management of sustainable supply chain. It also partners with various suppliers by bringing them
in its operations while locating their staff at different sites of suppliers with the aim of increasing
operations efficiency.
Framework for evaluation of sustainable supply chain in P&G
This case study examines the widespread effect of the highly visible organization in
particular P&G by focusing on how they promote their active participation in the sustainability
supply chain. The company deals with complicated operations since ideas of sourcing of palm oil
remain to be a different issue since it comprises of both negative and positive effects. The
positive effect remains to be its economic valued rescued several people in Indonesia from
poverty level (Kessler et al., 2012, p. 67). P&G along with other organizations have been
actively working towards attaining one hundred percent Roundtable on ways of obtaining
sustainable palm oil certification as an approach of demonstrating responsible sourcing. Besides,
P&G did make necessary changes to their mode of sourcing of operational policies that align
with the request of Greenpeace together with other non-governmental organizations. By April
204, P&G was able to record that it had eliminated cases of deforestation from all of its practices
of sourcing required palm oil. It also aimed at attaining sustainable supply chain by announcing
the policy for non-deforestation for all of its essential products. In such perspective, P&G was
able to confirm the objective of attaining traceability to palm oil mills by operating closely with
different suppliers to ensure there are no cases of deforestation in their supply chain by the
coming days as set in sustainability report of 2015. Such goal by P&G also applies to suppliers
of palm Kernel oil with the focus on improving both practices as well as likelihoods to develop
zero deforestation in the supply chain of P&G by early days of 2020 (Fayet and Vermeulen

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2012, p. 296). All these strategies have been essential in ensuring that P&G attains sustainable
supply chain by allowing the company to be on track to attain its operational goals.
Different issues on P&G that surround palm oil indicate that the organization has been
able to prove its capacity to react as well as change its sustainability on the supply chain in
different urgent scenarios. There are various realities that relate to the operations of P&G. One of
the essential factors for change is awareness of workers towards change in services and their
willingness to change to implement ideal strategies for management of supply chain during
operations (Sampson and Spring 2012, p. 43). Recently, the company has put more efforts to
have the perfect effective and efficient supply chain in their activities as possible. Such strategies
have made the company take significant strides towards attaining sustainable operations on
supplying of its products to targeted markets. On the P&G’s website, they have indicated that
they target to achieve zero cases of manufacturing waste to landfill from wastes (Wu et al., 2014,
p.97). The company has also concentrated on modifying the distinctive products like improving
in the manufacturing of bottles for shampoo products making the company be the best
performing brand to contain almost twenty-five percent post-client recycled beach plastic
products (Schoenherr and Swink 2015, p. 911). All these improvements on attaining appropriate
chain of supply have made P&G achieving the milestone on working towards becoming the
sustainable organization around global marketplaces (Debeny 2010, p. 53). Presently, the
company remains to be the viable organization with the lasting focus and sets the instance for
other organizations to follow
Role of Government
Wit presence of recent trend towards achieving sustainability in operations of P&G it
becomes necessary for organizations to respond such regulations. Sustainably produced products

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by P&G are developing in popularity. The share of sustainable commodities on the P&G
marketplaces is increasing. Suppliers in developing nations have to attain the much-needed set of
certification systems that always underpin the claim of sustainability (Wong 2010, p. 8). These
requirements are still covering both environmental along with issues affecting social and ethics.
Besides, the government of different regions where P&G operates performs different distinct
roles in addressing sustainability concerns of P&G. The government works carefully to ensure
that they foresee the policy of development of the organization. The government offer
regulations that every operator has to follow in the business markets (Sarkar 2017, p. 37). The
government also facilitates the process of achieving sustainable supply chain as other places do
in their marketplaces. Moreover, the different significant role of government in operations of
P&G is the idea of developing internal procedures for attaining sustainable working environment
and improving services.
In most cases, governments are always called in operation of P&G to help in forming a
solid partnership with the ones with other levels of authorities to ones with civil society
organizations and the private sector. About advancing sustainability, the government plays an
essential role in setting the vision to incorporate sustainability policy on operations of P&G.
Besides, employs two underlying system that is instrumental in operations of P&G (Lafley and
Martin 2013, p. 6). These include direct regulation and marketplaces instrument and economic
measures. The government remains to be a barrier to operations of P&G as in other places the
authorities always set strict rules for the organization making the management to withdraw their
products from such marketplaces. The government also possesses enormous taxes on operations
of P&G building the organization to use the vast amount to supports its operations in most
markets (Schoenher and Swink 2015, p. 887). The value-added tax in the sale of P&G

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commodities causes the company to increase the prices of their products and this makes most of
their competitors to take advantage of this by developing cheaper products that are similar.
Comparison of sustainability of P&G with others in the sector
Competition on sustainability faceoff became high between Procter and Gamble against
Colgate-Palmolive in the global marketplaces. The competition intense since the companies
wanted their targeted customers to trust their operations by making the clients understand that
they offer sustainable home products. Both organizations concentrated on the manufacturing of
some well-regarded brands that were similar (Butler 2016, p. 63). Some of these brands comprise
of Tom’s of Maine, Tide, along with Palmolive. The competition saw P&G setting up the
number of green objectives that the management hoped to achieve by early days of 2012. The
target included the aim of attaining twenty billion dollars in cumulative sales of different
products with low eco-influences. On the other hand, Colgate-Palmolive organization also
concentrated on making strides in sustainability with the use of LEED-certified manufacturing
organizations along with EPA designs for the surrounding (McCoy 2010, p. 39). The designed
help the organization in approving products including the production of Ultra Palmolive Pots
along with pans and Palmolive dishwashing liquids, Murphy oil soap Liquid, and Ajax Expert
glass that attracts huge markets.
Both organizations have upped the ante on their ambitions to attain sustainable supply
chain in the past few months, seeing it as the central concern in plans for development in
markets. It is hard to achieve glaring sustainability issues with the organization of P&G, but
there still exists a room for the operations of the corporation to attain improvement (Tunnicliffe
2016, p. 52). While the management of diversity, P&G could focus on getting the female
manager ratios to help in reflecting present’s fifty to fifty balance in the global society along with

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workforce in the US. Besides, Colgate’s comprehensive website always indicates data from
2008. The reflection makes it tough for the people to judge the recent efforts that the company
puts on its environmental sustainability (Colgate-Palmolive introduces new Palmolive body wash
variants in India 2012, p. 4). Both organizations work by forming ideal business models in their
operations to assist their workers in signaling the need for their services to go beyond the
activities that deal with innovating commodities. The model of the sustainable supply chain by
P&G concentrates on the essential raw materials used in manufacturing (Lafley and Martin 2013,
p. 7). Besides, Colgate-Palmolive focuses on improving its operations by prioritizing on the
process of regenerating resources by the use of wastes as ideal resources during the method of
producing new products like liquid soaps. Besides, many surveyors believed that Colgate-
Palmolive’s plan is varied to those of different organizations as it does not distinguishes its
operations between several sections of business or geographical locations, but it covers many
brands around the global marketplaces where it operates. The table below shows some of the
differences that arise between these two competitive companies.
Procter and Gamble Colgate-Palmolive
Overview Operations comprise of more
than 138, 00 workers
It attained approximately 79
billion in annual profit
Employ 36, 600 workers to
support its operations
Product Produces Ariel detergent’s
sustainability group designed
large and tightly sealed
Produces polythene bags that
Produces Tom’s of Maine that
was acquired by Colgate who
noticed the best chance to also
promote oral health in global

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are recyclable society
Management practices By early days of 2012, it seek
to develop at more than
twenty billion in cumulative
sales of products that had less
impact on environment
Making big strides in attaining
sustainability in internal
operations and disclosing new
metrics in various categories
Health Safety rating is less than 0.5
percent of total incident cases
Its safety rating stand at more
than one percent total rate of
incident
Wealth It encourages ownership of
employees
It restricts stock awards and
stock options granted to
various workers
Equality It focus on managing women
at a rate of about thirty-eight
percent
Its HRC equality index score
is eighty-five percent
Women management in
operation stands at thirty-two
percent
Its equality index score is
seventy-three percent
Table: Explores some of the differences that arise between these two competitive companies
Conclusion and Recommendations
It is evident from this illustration that sustainable supply chain in operations of a
company always shifts their perspectives from focusing on how to attain ideal ways of
minimizing the adverse effect to understanding how they can develop a positive impact on the
critical and relevant section of community and planet. This survey has shown that P&G comprise

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of various opportunities and strengths that can be further developed or strengthened to succeed in
the journey of attaining sustainable working conditions. Some of the positive aspects of P&G in
achieving the sustainable environment in its supply chain and management are broad. For
instance, it is evident that P&G has to concrete and challenges goals about the sustainability of
the situation. Besides, the organization has concrete goals concerning the social aspects of
sustainability that comprise of adequate access to fresh water supply, relief of disaster,
commitment to health, the wellbeing of consumers and commitment to diversity, equality, and
fundamental human rights. It is also clear that the organization has been able to remain
competitive since its employees believe that the organization is better at the innovation of new
techniques of operations that its competitors. The organization has the track of record of
genuinely sustainable outside-in commodities that include Safeguard that remains as a perfect
example of the argument of other surveyors.
There are various areas that P&G still requires to improve on so as it can advance on the
continuous sustainability. Such regions comprise of the need for public communication that is
always driven by leaders of the organization and the broad understanding of the vision,
commitments, and priorities of leaders about sustainability. Additionally, it is clear that P&G
requires to communicating the comprehensive strategy along with the business case for
sustainability that integrates it into the core strategy of the organization to ensure the initiatives
will not be accessible as peripheral or option. The company needs to incorporate sustainability of
its supply chain more deeply into the fabric of the organization specifically into goals of the
organization together with workers, as evident by inclusion in metrics of performance,
compensation, and rewarding employees at all sections of organizations. There is an apparent
discrepancy that arises between the perceptions of senior managers of corporate culture along

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with the understanding of employees in attaining sustainable working condition. Therefore, P&G
has to involve employees more in the commitment, operational strategies, commitment, and
actions of the organization about sustainability y of its supply chain.

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