Harvard Case - Procter & Gamble PuR Purifier of WaterTM (A): Developing the Product and Taking it to Market
"Procter & Gamble PuR Purifier of WaterTM (A): Developing the Product and Taking it to Market" Harvard business case study is written by Margaret Hanson, Karen Powell. It deals with the challenges in the field of Business Ethics. The case study is 22 page(s) long and it was first published on : Jan 10, 2006
At Fern Fort University, we recommend that Procter & Gamble (P&G) proceed with the launch of the PuR Purifier of WaterTM, but with a strong focus on ethical considerations and sustainable practices throughout the product lifecycle. This involves embracing a holistic approach that prioritizes corporate responsibility, ethical leadership, and stakeholder engagement.
2. Background
The case study focuses on P&G's development of the PuR Purifier of WaterTM, a water filtration system designed to address the growing global concern over water quality. P&G aims to capitalize on this market opportunity by offering a cost-effective and accessible solution. The case study highlights the various challenges P&G faces, including:
- Market dynamics: Identifying the target market, addressing competitive pressures, and navigating the complexities of international regulations.
- Product development: Ensuring the product's effectiveness, safety, and affordability.
- Marketing strategy: Communicating the value proposition and building consumer trust.
- Ethical considerations: Balancing profit maximization with social responsibility and sustainability concerns.
The main protagonists in the case study are the P&G executives responsible for developing and launching the PuR Purifier of WaterTM. They face the challenge of making decisions that balance business objectives with ethical considerations and stakeholder interests.
3. Analysis of the Case Study
Stakeholder Theory: P&G must consider the interests of various stakeholders, including consumers, employees, investors, suppliers, and the environment. This requires a transparent and ethical approach to address concerns regarding water safety, product efficacy, environmental impact, and fair labor practices.
Ethical Leadership: P&G's leadership must demonstrate ethical decision-making throughout the product lifecycle, from sourcing raw materials to marketing and distribution. This includes adhering to a strict code of conduct, promoting transparency, and ensuring accountability.
Sustainability: P&G must adopt sustainable practices to minimize the environmental impact of the PuR Purifier of WaterTM. This includes using eco-friendly materials, reducing energy consumption, and implementing responsible waste management practices.
Corporate Social Responsibility: P&G should integrate corporate responsibility into its business strategy. This involves addressing social issues related to water access, sanitation, and health, particularly in developing countries.
Ethical Marketing: P&G must ensure that its marketing campaigns are truthful, transparent, and ethical. This includes avoiding misleading claims, respecting cultural sensitivities, and promoting responsible water usage.
Supply Chain Ethics: P&G must ensure ethical sourcing practices throughout its supply chain, addressing issues like fair compensation, labor rights, and environmental protection.
Regulatory Compliance: P&G must comply with all relevant regulations and standards regarding water quality, product safety, and environmental protection.
Transparency: P&G should be transparent about its operations, including its sourcing practices, manufacturing processes, and environmental impact. This builds trust with stakeholders and fosters accountability.
Data Privacy: P&G must protect consumer data and ensure compliance with data privacy regulations.
Diversity and Inclusion: P&G should promote diversity and inclusion within its workforce and supply chain, fostering a culture of respect and equality.
Corporate Governance: P&G should implement strong corporate governance practices to ensure ethical and responsible decision-making.
Anti-Corruption: P&G must have robust anti-corruption measures in place to prevent unethical practices and maintain its reputation.
4. Recommendations
Develop a comprehensive sustainability strategy: P&G should integrate sustainability into its business strategy, focusing on reducing the environmental impact of the PuR Purifier of WaterTM throughout its lifecycle. This includes sourcing sustainable materials, optimizing manufacturing processes, and minimizing waste.
Implement a robust ethical sourcing program: P&G should ensure that all suppliers adhere to ethical standards regarding labor rights, environmental protection, and fair compensation. This involves conducting due diligence, implementing monitoring mechanisms, and providing training to suppliers.
Embrace transparency and accountability: P&G should be transparent about its operations, including its sourcing practices, manufacturing processes, and environmental impact. This includes publishing sustainability reports, engaging with stakeholders, and responding to concerns.
Develop a strong code of conduct: P&G should establish a comprehensive code of conduct that outlines ethical principles and expectations for all employees and partners. This should cover areas such as anti-corruption, data privacy, and conflicts of interest.
Invest in corporate philanthropy: P&G should invest in initiatives that address water access, sanitation, and health issues in developing countries. This could involve partnerships with non-profit organizations, community outreach programs, and financial contributions.
Promote ethical marketing: P&G should ensure that its marketing campaigns are truthful, transparent, and ethical. This includes avoiding misleading claims, respecting cultural sensitivities, and promoting responsible water usage.
Develop a comprehensive risk management framework: P&G should identify and assess potential risks related to ethical and sustainable practices. This includes developing mitigation strategies and monitoring progress.
5. Basis of Recommendations
These recommendations are based on the following considerations:
1. Core competencies and consistency with mission: P&G's mission is to improve the lives of consumers around the world. This aligns with the need to address water quality issues and promote sustainable practices.
2. External customers and internal clients: The recommendations address the concerns of consumers, employees, investors, and other stakeholders. They aim to build trust, enhance reputation, and create long-term value.
3. Competitors: P&G's competitors are also facing pressure to adopt ethical and sustainable practices. By embracing these principles, P&G can differentiate itself and gain a competitive advantage.
4. Attractiveness ' quantitative measures if applicable: The recommendations are expected to contribute to P&G's financial performance by reducing costs, enhancing brand reputation, and attracting investors who prioritize ethical and sustainable investing.
Assumptions: These recommendations assume that P&G is committed to ethical and sustainable practices and is willing to invest the necessary resources to implement these changes.
6. Conclusion
By adopting a holistic approach that prioritizes corporate responsibility, ethical leadership, and stakeholder engagement, P&G can successfully launch the PuR Purifier of WaterTM while upholding ethical standards and contributing to a more sustainable future. This approach will not only benefit P&G's business but also positively impact the lives of consumers and the environment.
7. Discussion
Alternatives not selected: P&G could choose to prioritize short-term profits over ethical and sustainable practices. This could involve cutting corners on sourcing, manufacturing, or marketing. However, this approach would likely lead to reputational damage, legal liabilities, and long-term financial consequences.
Risks and key assumptions: The key assumption is that P&G is committed to ethical and sustainable practices. If this commitment is not genuine, the recommendations will not be effective. Other risks include the cost of implementing these changes, the potential for resistance from internal stakeholders, and the possibility of unforeseen challenges in the supply chain.
Options Grid:
| Option | Description | Advantages | Disadvantages |
|---|---|---|---|
| Prioritize profits over ethics | Focus on maximizing profits without considering ethical or sustainable implications. | Lower costs, higher profits in the short term. | Reputational damage, legal liabilities, long-term financial consequences. |
| Embrace ethical and sustainable practices | Integrate ethical and sustainable practices into all aspects of the business. | Enhanced reputation, increased customer loyalty, long-term financial benefits. | Higher costs, potential for resistance from internal stakeholders. |
8. Next Steps
- Develop a detailed implementation plan: This should outline specific actions, timelines, and responsible individuals for each recommendation.
- Conduct stakeholder engagement: P&G should engage with stakeholders to gather feedback and build support for the proposed changes.
- Monitor progress and adapt: P&G should regularly monitor progress towards its ethical and sustainability goals and make adjustments as needed.
- Communicate transparently: P&G should communicate its progress and challenges to stakeholders through regular reports and public statements.
By taking these steps, P&G can ensure that the launch of the PuR Purifier of WaterTM is a success both commercially and ethically. This will contribute to P&G's long-term sustainability and strengthen its reputation as a responsible and ethical corporation.
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Case Description
P&G's PuR: Purifier of Water, a household water treatment sold in small sachets, was developed by P&G, in collaboration with the US Centers for Disease Control (CDC), and targeted 'bottom of the pyramid' (BOP) households, where water treatment facilities are often lacking. The product was a technological and public health success, but a commercial market failure (Case A). Internal stakeholders, however, believed in the effort. They re-positioned the initiative as a corporate social responsibility (CSR) venture, and found support within P&G's corporate organization, where it ultimately became a centerpiece of P&G's global CSR portfolio (Case B). The case chronicles the journey from product development for the commercial market, to CSR-supported BOP partnerships with the non-profit sector. A related case is available, exploring P&G's social marketing partnership with the global NGO, Population Services International (PSI): 'Procter & Gamble and Population Services International (PSI): Social Marketing for Safe Water'.
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