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Focus On Customers And Core Values

Dec. 8, 2005
Today's manufacturers must look beyond squeezing out costs.

At Procter & Gamble, we talk a lot about "moments of truth." In our business, there are two moments of truth -- when the consumer stands at the store shelf and chooses our brand and when she uses our product at home and decides whether it lives up to her expectations. These moments are so important to our success and growth that our organization structure is designed around them. Almost everything our 110,000 employees do comes down to these two moments.

In today's global, rapidly changing world, one of the most important qualities of leadership is the ability to define and organize around the moments of truth in your business.

Manufacturing leaders, like those in IndustryWeek's 50 Best, are doing just that. The manufacturing industry is undergoing a subtle but radical shift -- from a focus solely on highly efficient, low-cost manufacturing to a broader look at the entire supply network as a source of new value for our companies.

Keith Harrison, global product supply officer, Procter & Gamble Co.This is the kind of reinvention that requires strong leadership. The best leaders follow a consistent game plan for facilitating successful change within their organizations.

First, they start with a clear vision. For example, P&G's Product Supply organization shares a vision of an end-to-end supply network driven by the consumer. This network starts -- not ends -- with the first moment of truth at the store shelf, and is driven by consumer needs as it flows back through the retail customer, distribution, manufacturing and suppliers.

The next step is to build the right infrastructure by bringing the right organizations together and creating seamless connections. Leaders seek internal and external partnerships that add value and drive the moments of truth in their business.

Leaders understand what must remain constant, even in the midst of change. At P&G, we are led by our Purpose, Values and Principles. Our Purpose is to provide branded products and services of superior quality and value that improve the lives of the world's consumers. This Purpose has changed very little over the course of the company's history, even as we've dramatically redesigned how we operate to meet changing business realities and consumer needs.

Proctor & Gamble Co.
At A Glance
Leaders must be able to get the organization on board by creating a culture where employees at all levels look externally, put themselves in the consumers' shoes and measure their performance based on external metrics. This means challenging the organization to resist complacency -- especially when things are going well -- and having the agility to respond to emerging consumer and industry trends, technology and markets.

In all they do, strong leaders put their consumers' interests at the forefront. At P&G, we believe "the consumer is boss." What are the implications for your manufacturing operations when you look at them from the consumer's point of view?

Manufacturing today has reached its own moment of truth. Manufacturers can no longer be successful doing the same things we've done well in the past. The pressure has never been higher for innovation, for efficiency, for more flexible, less costly supply solutions and for competitiveness. U.S. manufacturers in particular can no longer win simply by squeezing out more costs. The time is right to be more opportunistic. We must lead our organizations to tap into manufacturing for new sources of value.

Related Essays

Follow The Leader: How companies are led translates into how well they perform.
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