Today, P&G released news that they are ahead of plan in their job cuts. Professional service firms working with big companies, like P&G, that are experiencing job and budget cut-backs, are in a great position to find new ways to add value. So, we’re re-posting these thoughts that we first released over a year ago when P&G first announced significant job cuts. How are you looking for ways to add new value as your clients evolve and change?
“We realize that we have to do it. The environment necessitates it. This will make us more agile and more fast-moving as an organization”
— Bob McDonald, CEO of Procter & Gamble
P&G announced this week that it will trim its workforce by 5,700 jobs over the next year, including cuts in marketing, product design, logistics and research. The cuts are part of overall plan to achieve $10 billion in savings by 2015. For hundreds of professional service firms working for P&G, these cuts could represent tremendous opportunity.
5,700 jobs no longer done “in-house”.
5,700 talented leaders looking for new roles.
Countless opportunities to help P&G re-invent.
The time to act is NOW…those servicing P&G who choose to “wait and see” might miss out on the biggest opportunities.
Here are the top 5 as we see them:
1) Fill the Gap
Don’t stand still. Marketing, design, market research, external relations — these are all P&G functions that are already dependent on vendor partnerships to execute a significant amount of work. This will certainly continue, but with a caveat. Less people left to manage the growing workload inherently means less potential points of contact with P&G and more reliance on a fewer number of supplier contacts. Proactively reach out to understand the new realities for the functions you serve and propose how you can fill the gaps.
2) Up Your Game From Specialist to Strategist
P&G managers are master strategists, consultants and integrators. It’s central to how they add value to the internal businesses they serve. Most professional service firms are experts in their domain areas, but have held back from delivering strategic, integrated business solutions — i.e. solutions that leverage both the specialized expertise that a firm is dedicated to with broader business application thought leadership, trends and adjacent industry/domain knowledge, etc. in a way that is uniquely relevant to a specific client. As there will be fewer of these “master strategic integrators” in-house at P&G, the opportunity for vendors to step in and provide these solutions is clear. This will mean adding new skills and mindsets; and potentially re-positioning your deliverables.
3) Evolve Your Business Model
Given the depth of these cuts, P&G will be more open than ever before to new ways of working with vendors. In fact, as they find new ways to work more efficiently, they will expect their vendors to re-invent as well. This is your opportunity to reconsider many aspects of your business model. Pricing. Projects vs. longer term engagements. Alternate ways to get “commodity level” work done. Launching new services or capabilities that meet client needs better, faster, more completely. Give yourself permission to reconsider your business model and then collaborate with P&G to build something better.
4) Jump into the Talent War
We might be a bit biased, but P&G talent is outstanding. As part of your strategy, you should strongly consider investing in the right available P&G talent. Don’t let your competitors beat you to the opportunity.
5) Create Partnerships to Make You Stronger
Most professional service firms who’ve worked with P&G for any length of time understand their strong desire for single point leadership committed to their business. As fewer leaders at P&G take on larger scopes of work, the vendors that will win their loyalty will pro-actively build cross-vendor collaboration – even amongst traditional competitors. Partnerships can drive cost out of your business model. Partnerships can bring specialization and knowledge that will enable you to keep business you might otherwise lose. Partnerships deliver the expertise and technology to create new solutions, getting to market faster and sharing risk.
In many ways, P&G is a leader of change across CPG and other industries. The push for efficiency and innovating cost out of the system will certainly not be limited to P&G. Professional service firms that seize the opportunity now with P&G will reap the rewards across their client base in years to come.
The Garage Group partners with professional service firms who serve P&G and other Fortune 500 companies to help them adapt their business models and launch new services. We’d love to help you capture opportunities with your clients. Give us a call and let’s talk!
Photo licensed under Creative Commons 2.0 via Flickr user: WebXplorer