To become lighter on its feet, P&G is “doubling down” on cost cutting by eliminating $10 billion in costs over the next five years. Just four years ago, P&G said it would slash costs by $10 billion, which the company now says it is ahead of schedule to achieve. Since 2012, P&G eliminated 20,000 jobs. The pending Duracell sale and spinoff of brands to Coty will remove 2,700 and 10,000 jobs respectively from P&G’s payroll. By mid-2017, P&G will employ 95,000 to 98,000 worldwide. Between cuts and brand sales, P&G is on track to have its smallest workforce since at least 2003 and possibly since 1991.
Company executives hope a smaller headcount leads to bigger things.
"A few years ago, we got too central and global and too slow to address market opportunities," Taylor admitted. "We need more direct ownership for our regional managers all the way to the store shelf."
Taylor wasn't the only P&G executives with a confession to make. CFO Jon Moeller told the CAGNY audience that it may have misjudged China consumers.
"In many ways we looked at China a little bit too much as a developing market, as opposed to the most discerning consumers in the world," he said. In an about-face, P&G is determined to exploit the elimination of China's one-child policy, as well as its growing preference for premium products.