P&G's Muddled Messages, And The Need For Corporate Meaning

"To touch and improve lives" is the stated purpose of Procter & Gamble. One has to ask: Doesn’t every company want to improve the lives of its customers, employees, and other stakeholders? Would a company deliberately not want to improve lives? Would they be satisfied if one of their brands' positioning statements was simply to improve lives? Was "improving lives" chosen by committee since it’s so general that it could mean anything to anyone? And why "touch"? It seems so gentle a word, like the words "tiptoeing" or "tapping," almost apologetic in its essence.

In an October interview with Fortune, P&G CEO and Chairman Bob McDonald discussed the financial pressures facing the company and outlined some of his initiatives to address these.

However, this interview raised more issues for me than it did answer or address them. There’s the problem of the multiple messages that employees hear each day. There’s the 40-20-10 plan asking employees to focus on 40 biggest categories/countries, 20 biggest innovations, and 10 emerging markets. Then there’s a message to focus on "discontinuous innovation," in other words, radical or revolutionary innovation. So does that mean only discontinuous innovations will be accepted and funded in the next few years? What about other less radical innovations? Where do they fit? Should employees bother recommending anything less than discontinuous innovation?

Then there’s also the message of the desire to create a "culture of productivity." There’s a productivity plan to save $2 billion a year. Employees are told to focus on innovations and to focus on productivity, which typically translates to asking them to focus on expansion and contraction at the same time, or to focus on both abundance and scarcity. Some employees may think that message of innovation is inspiring, while the message of productivity is constraining (and so 1980s!).

Then there’s the message that the company has to "deliver the plan," which means delivering the financial goals outlined in a plan developed by the executive team and supported by country and brand plans at a lower level. This means working toward the financial goals which will deliver the operating margins and bottom line results that will, in turn, encourage a stronger performance in the stock market. However, our research has shown us that less than 30% of employees are motivated by numbers and specifically the company’s stock price, while 70% need something more, something deeper to inspire them. Day after day, hour after hour, these employees want to know that their efforts are worth more than just "delivering the plan."

And then there’s the message of "reduced enrollment," which means fewer employees in the company. Employees probably work in fear that they may be the next on the list whose goal is to reduce enrollment by 5,700 people. But, of course, stay motivated!

Finally, there’s the problem of "sku explosion." One only needs to visit the Olay beauty section of a neighborhood store to see the lack of focus on this brand. How many products can come under one brand name before the consumer becomes confused, overwhelmed, and stressed by all the choices? Not to overlook the lack of efficiencies in production and distribution.

These issues: a vague purpose statement; multiple messaging; a misplaced dual focus on discontinuous innovation and productivity; a request for a laser focus on delivering the (financial) plan; fear of reduced enrollment; a lack of focus on several brands; and overall financial pressures, all stem from the lack of understanding of what the true meaning of P&G is.

It’s time for P&G to rethink what its one message should be. For an organization known for its superior marketing and business discipline, it’s time for it to focus on one unique and meaningful message. We call this the "meaning message," a concise, commonly understood statement that highlights the true meaning of the organization and which serves to inspire and provide direction. It’s a message that also captures the spirit of the organization.

It’s time to address the dual focus on productivity and innovation. The dual focus on productivity and innovation can be solved by delivering one message: asking employees to focus on a range of innovation or a continuum of innovation—from efficiency innovation (improving what is, including productivity ideas), to evolutionary innovation (ideas that are distinctly new and better) to revolutionary innovation (radically new ideas that dismantle or "disrupt" the structure of the company, category, or marketplace). Each project can be placed where it belongs along the continuum to determine whether the organization is well represented in each category of innovations. One concept, one message.

It’s clear to me that P&G needs meaning, as well as meaningful innovation, and they need it now.

—Elaine Dundon is CEO of the OPA! Center for Meaning and author of The Seeds of Innovation.

[Image: Flickr user Campbell Orme]