Procter And Gamble Harvard Case

Procter & Gamble (P&G) became one of the leading multi-nationals of consumer goods by focusing on innovation, international growth, and acquiring popular brands. With a vast portfolio that serves 4.4 million people worldwide, P&G recognized the need to standardized procedures and services across business unites. For that reason, in the year 1999, they decided to bring the Global Business Services (GBS) in-house to become more efficient and consequently save money. The GBS division was in charge of providing internal services which included accounting, finance, customer logistics, employee services, IT, among other services to the five global P&G business units. Despite achieving its cost saving objectives, top executives raised concerns about

They needed to manage cost, labor relations, and other managerial issues that arose with the proposition of this strategy. With outside pressures and different interest at stake, P&G did not make a decision that tailored to everyone, but they definitely tried to make the choice that provided them with the most flexibility. In the end, they decided to go with option three which was that ‘best-of-breed’ approach. To better understand P&G’s challenges associated with this outsourcing decision, the paper will analyse P&G case study using Organizational Boundaries and Theories of Organization by Santos and Eisenhardt (2005) which explores “the demarcation between organizations and the environment” (491). The boundary conceptions include efficiency (cost), power (autonomy), competence (growth), and identity (coherence). All of which can shape and affect companies on important

Option two could be successful depending on the culture of the new partnership. Nonetheless, since all companies are somewhat different, the workers will still need support during the transition. If this experience is not smooth for them, this can affect the remaining workers that stay in P&G. The third option can get a little more complex because since P&G would be partnering with different vendors, there is probably going to be differences across all of them. The last option would be the safest choice in terms of making P&G’s values and actions align.
Conclusion
Using the Organizational Boundaries Framework, we can understand the reasons behind P&G decision to go with option three. There were challenges faced throughout the process, but when weighted out, option three was definitely the best plan. B&G really wanted a change. Although they recognize GBS contribution, they wanted to get rid of the burden of thinking and developing the division as a whole. In exchange, now they will not only benefit from working with the ‘best-of-breed’ companies, but they will have a more positive workforce reaction due to the flexibility and benefits of the