7 minute read 8 Feb 2021
A worker is seen on the dish packing line

How a people-empowering culture helped P&G pull through the pandemic

By Craig Lyjak

EY Global Smart Factory Leader

Operational Excellence thought leader. Digital innovator. Passionate developer of people. Foodie. Father.

7 minute read 8 Feb 2021
Related topics Alliances

Lockdown hit many factories hard. Yet some P&G plants increased production with fewer staff, and actively helped their local communities.

In brief
  • P&G's Integrated Work System empowers employees by giving them clear ownership and accountability.
  • P&G plants didn't just beat pre-pandemic performance but actually found opportunities for further process improvements.
  • Caring for the local community meant P&G gave gifts for employees' kids, secured broadband for more homes, and donated care kits to hospitals.

Procter & Gamble (P&G) is a globally recognized supply chain master. The company’s Integrated Work System (IWS) is effectively its daily operating system – an encyclopedia of highly-codified capabilities combining reliability engineering with Lean, equipment ownership and daily management systems.

And one of the key facets of IWS is how it empowers every employee through a vertical line-centric model that establishes clear ownership, accountability and results by line.

IWS is primarily oriented toward eliminating losses and waste. But when the COVID-19 pandemic began to impact P&G’s production sites and staff, line operators and managers doubled down on the mindset and principles of IWS not only to survive, but thrive, and even support local communities and businesses with donations and best-practice guidance.

A worker operates a-machine on the production line
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1

Chapter 1

The initial impact

P&G focused on anticipating lockdown’s and associated restrictions’ effects on production.

As news of the growing pandemic spread, P&G plants around the world started to wake up to the potential impact on their operations.

Seema Menon is the plant manager at P&G’s facility in Baddi, Himachal Pradesh, India, which produces all of P&G’s shampoo and conditioner in India, and 40% of its fabric care products. Officially 25 March was the start of lockdown in India, but in Himachal Pradesh it began on 22 March and the government initially prohibited any operations other than pharmaceutical manufacturing, along with movement of people or goods. So Menon’s operations had to shut down immediately, on a Saturday.

It wasn’t long before permission was granted for the plant to start up fabric care production again – but travel restrictions were still in place. “We got permission to start up, and then realized that we have only probably 10% to 20% of the technicians available in the area,” says Menon. “So, after say, 10 days of shutdown, we started up fabric care with two technicians.” In addition, all of the plant’s managers were out of state and not permitted to travel, so they had to work from home.

Farid Khan is plant manager in Albany, Georgia, United States. He recalls the early days of the pandemic. With the first cases of COVID-19 in the local hospital, Khan began to think about what it might mean for the site and its people. “Albany has been through quite a bit in the past, being hit by a tornado and hurricanes,” he says. “So we had that business contingency plan and playbook, and we pulled it out and said, ‘Okay, what happens if COVID-19 comes our way?’”

A woker is pictured on the production line at the lima plant
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Chapter 2

Adapting fast with IWS

P&G’s IWS gave the plants a solid foundation for responding to a crisis.

Rather than panicking and formulating ad hoc workarounds to disruptions such as staff shortages, P&G plant managers could refer to their daily work structure to move forward with confidence.

“When a crisis strikes, there's a temptation to abandon the core thing that you do day in and day out,” says Jason Jackson, Beauty Care plant manager at Iowa City. “And in reality, we've got these core systems, this core culture, these behaviors, and instead of abandoning that we should look to it and say, ‘Okay, how do we leverage what we're good at, in order to accelerate and learn through this crisis?’”

Involving people is critical not only to managing a crisis, but also to daily work in IWS, as Jackson explains. “One portion of IWS is about driving losses to zero. But the other portion is how do you drive those losses to zero by making sure everyone feels involved, everyone feels like an owner and everyone feels empowered?”

In the Himachal Pradesh plant, the operational culture was integral to continuity despite massively reduced staffing. “What we had was what we call a self-sufficient team, which means the technicians operate their lines, but also independently manage any technical expertise problems,” says Menon. “The second strategy which helped us is ‘flow to work,’ which means that most of my technicians are trained and qualified to operate at least two technologies. So with the available technician pool, we put them in the places where we needed them, despite the fact that they were not doing that role before, and they were able to start up almost vertically.”

What does empowered feel like at P&G?

Most technicians are trained and qualified to operate at least two technologies. This meant they could be put where they were needed most, even if they had not performed that role before.

In Albany, public panic buying put greater pressure on operations. “In mid-February, I'm sitting down with my central planners and I couldn't understand why my demand was going a lot higher,” says Khan. “Folks are looking like they're buying a lot more paper towel and toilet paper.” This meant that yet more production lines needed to start up to meet demand. But Khan’s team went back to the commercial partners and proposed something different: by streamlining the number of SKUs in production, they could produce higher volumes overall to meet the increased demand.

It worked, as Khan explains: “They came back and literally we took away about 20% of our SKUs.” This had quite an impact on production: “We were not only making more cases, we were breaking records that have been made in the past 48 years. And we're making them at a lower cost because now we're using the same efforts to make more cases with the same number of people,” Khan says.

How is this possible? It’s because of the constant investment in improvements that is one of the secrets of P&G’s success.

“When I worked for P&G, we once made a rapid improvement in efficiency that meant we could achieve a week’s production in five days. So we had downtime, and we could have furloughed people. But instead, every shift, we shut down for four hours to do hands-on training. So, say, 60% people capacity might be sufficient to maintain the status quo, but it’s insufficient to sustain the constant cycle of improvement and reinvest in skills and capacity building that helps create year-on-year productivity gains at P&G.”

And it’s those skills and that capacity, along with the people empowerment and trust that is core to IWS, that meant P&G’s plants could thrive in this crisis.

Workers checking monitors in the dry laundry control room
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Chapter 3

COVID-19 operations drive even better processes

P&G plants not only exceeded prior performance but also identified further process improvements.

Perhaps an even better indicator of resilience – and the true value of IWS – is that numerous P&G plants not only managed to exceed their pre-COVID-19 performance and deliver record reliability, but also identified opportunities to further improve processes.

For example, in Albany, Khan’s team shared video footage of lines that needed attention with managers working remotely so that they could be optimized. Khan explains, “The teams were now having to operate totally on their own… we would just have these virtual meetings. So we started implementing some different remote-access tools, with real-time annotation and videos capturing what needs to happen.” Line operators were entrusted more than ever to make the right decisions – and the policy worked. “Realistically, they made the call and they just did it. I'll tell you, they did it right. They did it better than some of us would have done it,” says Khan.

Albany also had to anticipate a savings project that was coming 20 months down the line, and by working with R&D and engineering teams, “we were able to get this project lined up with a better ROR and net present value and with lower capital than we originally thought,” Khan says.

IWS is all about empowering every employee through a vertical line-centric model that establishes clear ownership and accountability. During the pandemic, line operators were entrusted more than ever to make the right decisions. They rose to the challenge, and the policy worked.

Workers discuss packaging on the factory floor
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Chapter 4

Supporting local communities

The team took pride and ownership in taking care of the community as well as each other.

During the pandemic, communities faced closures of schools and daycare centers, and P&G plants did all they could to accommodate flex schedules so employees could care for their children at home. In Albany, says Khan, “We also sent the kids at home little gift packages with puzzles and coloring books and toys, so they could keep themselves occupied, as well as thank you for sacrificing their parents to work additional hours.” Again, this is rooted in IWS: “That was all led with our HPO principles about making sure our folks are first,” Khan explains.

But the Albany team went further, helping its local community reopen restaurants and small businesses and prepare for the school year – even helping influence the community to get broadband into more homes. “All those were just losses that we found at work that we were able to share with them,” says Khan. “The relationships that we've built with the community through this process have just been outstanding,” he continues. 

In Iowa City, Jackson’s team was also able to ramp up manufacturing of a suddenly scarce resource: hand sanitizer. “I thought, ‘Oh gosh, everyone's already so busy. How are we going to do this?’ And all of a sudden, people just created this capacity. Within a couple of weeks, we're making it 10 tons at a time,” says Jackson. Employees of the Iowa City plant were also looking for other opportunities in the community to help out, and so P&G donated personal care kits to local hospitals that were under extreme pressure with COVID-19 patients.

Jackson concludes, “The pride and ownership that the team has to deliver the business, to take care of the community, and to take care of each other, I think, have just been on full display, and that has been a really cool thing to be a part of.”

Summary

P&G’s Integrated Work System has helped the organization achieve world-leading efficiency and waste reduction in its manufacturing plants. When the COVID-19 pandemic disrupted operations, P&G plant employees were able to dig into their playbooks to keep lines open, empower operators to make decisions and share product and best practice to help local communities come back from the crisis.

About this article

By Craig Lyjak

EY Global Smart Factory Leader

Operational Excellence thought leader. Digital innovator. Passionate developer of people. Foodie. Father.

Related topics Alliances