Fueled by Productivity

This ongoing need to invest to strengthen our offerings across every aspect of superiority, the need to mitigate cost and currency challenges, and the need to expand margins and generate cash requires a commitment to productivity in everything we do.

Productivity is more than cost cutting. It is a more efficient way of operating—in service to consumers and customers—every day.

We are reaccelerating productivity back to pre-pandemic levels, with an objective for gross savings in cost of goods sold of up to $1.5 billion before tax. Our visibility to more savings opportunities is increasing, enabled by platform programs with global application across categories, like Supply Chain 3.0.

With our Supply Chain 3.0 efforts, we are becoming more efficient in managing the delivery of our products to our retail partners, enabled by automation, data synchronization between P&G and customers, and digitization, which allows the retailer to check in the entire shipment at once. With this capability, what used to take two people two and a half days to do, now can take as little as 10 minutes—a more than 99% savings in effort—improving truck use, labor savings and cash productivity.

In brand building, we are increasingly more effective and efficient in consumer targeting, ad placement, and advertising quality—reinvesting savings and driving a higher return on investment along the way. In North America, for example, over the past five years we have improved productivity of media and advertising as a driver for growth—accelerating value creation. We have increased the number of consumers reached through media by 14 points. Advertising return on investment has improved nearly 40%. We have delivered over $1 billion in productivity through rate improvements, operational efficiencies and applied analytics. We are applying this approach globally.

Overall, we take a disciplined approach to productivity and cost management. We are investing in new capabilities and using more digital tools to increase speed and lower costs. We continue to invest to drive demand in our categories and our brands, while simultaneously and sustainably improving structural profitability to deliver balanced top- and bottom-line growth and strong cash generation.