Free Diversifying P&G's Supplier Base (A) Case Study Solution | Assignment Help

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Written by Gary F. Smith
Publish Date: 2024-12-04

Harvard Case - Diversifying P&G's Supplier Base (A)

"Diversifying P&G's Supplier Base (A)" Harvard business case study is written by Kris Ferreira, Kym Lew Nelson, Carin-Isabel Knoop, Sarah Mehta. It deals with the challenges in the field of Negotiation. The case study is 17 page(s) long and it was first published on : Oct 7, 2021

Main Protagonists:

  • Procter & Gamble (P&G): A multinational consumer goods company
  • Minority-owned businesses (MBEs) and women-owned businesses (WBEs): Potential suppliers to P&G

3. Analysis of the Case Study

**Strategic Analysis:*** P&G's lack of supplier diversity limits its access to innovative products and services from underrepresented suppliers.* Diversifying the supplier base can enhance P&G's reputation as a socially responsible company.

Financial Analysis:

  • Investing in supplier diversity can lead to cost savings and improved profitability through increased competition and innovation.

Marketing Analysis:

  • A diverse supplier base can help P&G better meet the needs of diverse consumer segments.

Operational Analysis:

  • Managing a diverse supplier base requires effective communication, collaboration, and training programs.

4. Recommendations

**Supplier Diversity Program:*** Establish clear goals and metrics for increasing the number of MBEs and WBEs in P&G's supplier base.* Implement a supplier outreach program to identify and engage with potential diverse suppliers.* Provide training and support to diverse suppliers to enhance their capabilities and competitiveness.

Supplier Evaluation and Selection:

  • Use objective criteria to evaluate diverse suppliers based on quality, cost, and delivery performance.
  • Consider supplier diversity as a factor in the supplier selection process, while ensuring fair competition.

Collaboration and Partnerships:

  • Partner with organizations that support MBE and WBE development.
  • Establish mentoring programs to connect diverse suppliers with experienced P&G executives.

Communication and Transparency:

  • Communicate P&G's supplier diversity goals and initiatives to all stakeholders.
  • Regularly report on the progress and impact of the supplier diversity program.

5. Basis of Recommendations

**Core Competencies and Mission:*** The supplier diversity program aligns with P&G's commitment to diversity and inclusion.

External Customers and Internal Clients:

  • A diverse supplier base can help P&G meet the needs of diverse consumer segments and enhance employee satisfaction.

Competitors:

  • Diversifying the supplier base can provide P&G with a competitive advantage by accessing innovative products and services.

Attractiveness:

  • The potential benefits of supplier diversity, including cost savings, improved profitability, and enhanced reputation, outweigh the costs of implementation.

6. Conclusion

By implementing a comprehensive supplier diversity program, P&G can significantly enhance its supplier base, foster innovation, and drive business growth.

7. Discussion

**Alternatives Not Selected:*** **Quotas:** Establishing quotas for MBE and WBE suppliers could raise concerns about fairness and competition.* **Preferential Treatment:** Granting preferential treatment to diverse suppliers could undermine the principles of fair competition.

Risks and Assumptions:

  • Supplier Capacity: Diverse suppliers may not have the capacity to meet P&G's demand.
  • Cultural Differences: Managing a diverse supplier base requires sensitivity to cultural differences and effective communication strategies.

8. Next Steps

* **Timeline:** * Year 1: Establish supplier diversity program and outreach initiatives. * Year 2: Implement supplier evaluation and selection process. * Year 3: Monitor progress and adjust program as needed.* **Key Milestones:** * Number of MBEs and WBEs in P&G's supplier base increased by 20%. * Improved supplier performance and innovation. * Enhanced reputation as a socially responsible company.

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Case Description

In February 2003, P&G hosted two meetings-one with its largest woman- and minority-owned suppliers and one with its largest non-minority-owned suppliers. Attendees in each meeting heard the same message: P&G was keen to grow its commitment to inclusive supply chains, but felt hamstrung by the limited scale and scope of its existing woman- and minority-owned suppliers. It was up to the attendees to determine how to work together to meet P&G's needs. Otherwise, the consumer packaged goods giant would be forced to look outside its home city of Cincinnati, Ohio, for diverse suppliers at scale. This case tells the story of how Carl Satterwhite, president and co-owner of Infinity Services, a minority-owned furniture installation business, and J. Scott Robertson, president and owner of Globe Business Interiors (GBI), a non-minority-owned office furniture company, responded to P&G's call.

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