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Overview of the Multinational giant

P&G is one of the most vastly growing multinational company and the largest consumer
goods manufacturer, which touches the lives of about millions of people across the glove with
its diverse range of product portfolio. P&G spends around $400 million every year on
consumer research to uncover opportunities for innovation across nearly 100 countries. It
launched a connect and develop program to systematically engage with partners outside the
boundaries of the company to source new-product ideas. In 2012, its head of technology
announced that P&G had tripled its innovation success ratethe percentage of ideas that
made it successfully to market as new products. Indeed, innovation has long been at the heart
of P&Gs success, which took its founding inspiration from Thomas Edison, who created the
worlds first industrial research lab. P&G is focused on strategies that they believe are right
for the long-term health of the Company with the objective of delivering total shareholder
return in the top one-third of P&Gs peer group. Due to consumers taste and preferences,
Proctor and Gamble is constantly changing its products through innovation and presenting its
product ranges to the consumers and customers delivering promising features and benefits.

Sustainability as a key driver for innovation

Theres no alternative to sustainable development. Even so, many companies are convinced
that the more environment-friendly they become, the more the effort will erode their
competitiveness. Once companies have learned to keep pace with regulation, they become
more proactive about environmental issues. Many then focus on reducing the consumption of
nonrenewable resources such as coal, petroleum, and natural gas along with renewable
resources such as water and timber. The drive to be more efficient extends from
manufacturing facilities and offices to the value chain. Same thing is applicable to P&G as
well when they started to implement the LCA (Life Cycle Assessment) that includes the
overall life cycle of any particular product starting from manufacturing to the end-disposals.
They also conducted various studies on human behavior and consumption pattern in which
they take part in various activities such as the usage rate and disposal of any product form the
consumers end. In regards to sustainable development and innovating products tailoring to
the consumers end, it is very important to make the operations more efficient and reducing
the companies dependency on fossil fuels. There are various sustainability challenges,
competencies and opportunities for a multinational giant like Proctor & Gamble where few
important stages need to be fulfilled strategically.

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In this case study, focus has been given on how P&G is incorporating sustainability as means
of doing business responsibly. Most importantly, there are many driver that leads to the
greater achievement is sustainability as they have adopted sustainability in their core values
and principals of the company. Moreover, the employees are also taking the responsibility as
it is built into the rhythm of business to integrate sustainability into home and workplace. In
addition, the stakeholders and employees are devoted towards ensuring better quality of life
for everyone for present and future generations followed by integrating economic
development, environmental protection and social responsibility.
P&G also focused on greater consumer benefits as they reinvented majority of their product
starting from Laundry detergents to babys diapers, where they incorporated technologies and
innovation in order to meet the criteria of the customers. For that reason, they have reduced
the amount of materials in the manufacturing process along with the consumption of energy.
They also have reduced the packaging materials and kept similar packaging contents for their
diverse product offerings by simplifying the design. Most importantly, they have made these
implementations possible with the greater help of Life Cycle Assessment (LCA) from which
the company can make the most meaningful improvements in a products environmental
footprint. The process starts from the creation of raw materials followed by manufacturing
and logistics, integrated value chain and ultimate disposal of the product.

Challenges and Issues with Sustainability initiative

As P&G wants to incorporate sustainability with innovation, they have undertaken the help of
technology and environmental sciences in order to fulfill their purpose and vision. However,
while achieving their target, they were faced with several issues and obstacles with the
technology initiative and prior to the incorporation of sustainability initiative in the early
1950s. After analyzing the case these issues are addressed and are mentioned with brief
discussion. Later on, some recommendations are provided in order to cope up with those
issues where some were also addressed and recommended by P&G as well.

The presence of non-biodegradable surfactants in the laundry detergent that resulted

in the formation of foams in river creating an impact on water and environment

Problems with decision making between sustainability, performance and value while
delivering customers with superior benefits with no trade-offs

Different product systems might require distinct LCA methods because environment
values are not clearly integrated in market

Differing human needs, preferences and income may limit the capacity of LCA of a
product system due to consumer choices and preferences.

LCA cannot easily capture one product system for the entire supply chain, as LCA is
not value free.

Discussion
The presence of non-biodegradable surfactants in the laundry detergent that resulted in
the formation of foams in river creating an impact on water and environment
In the early 1950s, laundry detergents, which people used for washing weren't as good as
today's detergents. Materials used in the production created many problems such as,
surfactants in detergent resulted suds and foams in river water and suds in riverside.
Moreover, it wasn't biodegradable. Suds are bubbles or foam. The main purpose of detergents
is to clean clothes. Excessive amounts of foam creates problem in washing clothes. The
amounts of suds in detergent should be low. To minimize the level of suds P&G made
extensive research. The focus was to eliminate the problem without compromising the
performance of products. Consumers definitely wanted good products, which will provide
better services. They like products, which will be good for the environment, but they don't
want to compromise the performance. Because, at the end, what consumers want, is better
benefits and services. In order to provide better services it was very important for P&G to
remove any problems created by their product.
Problems with decision making between sustainability, performance and value while
delivering customers with superior benefits with no trade-offs
As the authors discussed earlier that the first priority of P&G is to ensure that customers
dont have to make choices between sustainability, performance, and value for money. They
forecasted the future and need for product development as the customers are being more
concerned regarding the product standard environmental sustainability. P&G took it as an
opportunity and started improving the product line, which will be environmentally

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sustainable, well performing, and provides good value for money. They invested a large
amount of money in research and development to have reduction in environmental footprint
through commercial and innovative product. As mentioned in the case the bottles used in
shampoo and conditioning bottles are primarily made of plant-based plastic, which produce
170%, less greenhouse gases per ton than traditional petroleum based plastic. Another
innovative product is their cold-water detergent powder that requires no hot water, which
results less energy bills for the customers. The scenario became more blurred when the
customers were becoming more environmentally conscious and by the same time they are not
willing to pay higher for the facility provided. As the authors discussed, despite such
improvements some customer groups are confused or guilty about the sustainability as they
try to balance cost, convenience, and hygiene facts with potential environmental impacts.
Different product systems might require distinct LCA methods because environment values
are not clearly integrated in market
One of the objectives of LCA is to understand the overall and interdependent nature of the
environmental consequences of human activities and to provide decision-makers with
information to identify opportunities for environmental improvements. However, different
product systems require distinct LCA methods because environmental values are not clearly
integrated in market. Environmental impacts could be described as energy use, greenhouse
gas emissions, solid waste generation, water use, etc. Distinguishing between the different
environmental effects that each product has is difficult and time consuming. At the same
time, implying different LCA methods for each would mean increased costs for P&G.
Differing human needs, preferences and income may limit the capacity of LCA of a
product system due to consumer choices and preferences
Most human activities have some environmental impact. Differing human needs, preferences
and incomes may limit the capacity of LCA of a product system due to consumer choices and
preferences. For this reason, economic and social impacts are not currently assessed within
the LCA. It is not essential that all consumers of a product would use the product and dispose
it off in similar manner, thus implying that one specific LCA for a product might not be
application for all. An example of this could be that of P&Gs detergent product, it is not

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essential that 2 people who are buying the product do the disposal of the package after use in
similar manner.
LCA cannot easily capture one product system for the entire supply chain, as LCA is not
value free
LCA is not value free, thereby reducing objectivity and completeness of LCA results.
Managers should understand the need to clearly identify and state value-based choices in
LCA, which could stand as a difficult task for them. Furthermore, value-based choices are a
snapshot of the present without taking the future into account, which can be a great issue.

Recommendations
P&G took necessary steps to combat that issue. They established an environmental science
department. As a result they successfully created improved methods, which is biodegradable
and safe for the environment. It was possible through Sturm test. Sturm test allowed P&G to
change its ingredients used in the production. Previously P&G conducted various studies in
human and environmental toxicology with an in depth understanding of how people use its
products and dispose of them across globe.
Considering all these facts P&G focused on this sustainable mainstream and developed new
products, which enabled consumers to be environmentally sustainable, but for which there
were no trade-offs, and this is where they adopted the idea for sustainable innovative products
(SIPs). The consequences shows it resulted in reduces environmental footprints for which
there are no trade-offs to the customers and due to that with time their products became
highlighted. To ensure sustainable approach P&G adopted a 3-legged approach covering
environmental protection, economic development, and social responsibility.
Corporate strategy should consider combining LCA with other tools for social and economic
assessments of products and services. Furthermore, management should not solely rely on the
LCA tool for environmental impacts. Including other methods and approaches will increase
data reliability, decision-making and corporate strategy. This is the strategy that P&G
followed where P&G signed a Cooperative Research and Development Agreement (CRADA)
with the Environmental Protection Agency (EPA) National Risk Management Research

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Laboratory (NRMRL) to develop tools and methods for optimization and improvement of
sustainability metrics and indicators within products, manufacturing and supply chain
contexts.
The life cycle approach is a useful way to come to an understanding of the material and
energy needed to make a product or deliver a service, see where wastes are generated, and
estimate the subsequent impacts that these wastes may have on the environment. It is a good
way to improve a product chain, articulate tradeoffs, and make comparisons among
alternative processes and products. In these contexts LCA facilitates decision making by
managers, designers, and other stakeholders. Most importantly, LCA is a way of framing
policy options in a comprehensive and systematic way. It focuses on the ability of practical
applications of life cycle assessment to support claims of greater environmental friendliness
based on both direct and indirect sources. Thus, helping P&G with its sustainability
strategies.

Conclusion
Despite all the issues and challenges P&G is incurring and facing while implementing
sustainability in their business, they are recovering and delivering the customers most
benefits than challenges. Besides they also incorporate sustainability in their purpose and
values of business followed by employee behavior and shareholders values as well.