Ogling Talent Beyond its Ranks? Surely Not P&G

Gillette Execs Take Charge, Employees Feel Betrayed

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Promote-from-within has defined Procter & Gamble Co. marketing from its beginning, helping create a company not unlike the U.S. military. Strong on logistics. Rife with obscure acronyms. Not always so nimble. Wins most of the time.

Surprisingly, however, P&G is tinkering with promote-from-within amid its strongest run since Neil McElroy, inventor of brand management, took leave to run the Defense Department under Eisenhower. As Donald Rumsfeld can tell you, messing with entrenched institutional cultures isn't easy. It's not always a good idea, either.

P&G's latest cultural evolution comes thanks to its Gillette acquisition. Gillette executives now are in charge at the three biggest points where the companies overlap. These include deodorants, oral care and the group that oversees sales, media and local-marketing initiatives in North America. This is rare in any acquisition, but particularly for P&G.

In the past, the company often purged acquired cultures. Sure, P&G kept some executives from past acquisitions. And, thanks to its acquisition spree of recent years, 40% of all employees have entered via acquisition. But that same proportion isn't close to being reflected among the top 50 or 200 executives.

The Gillette executives are the first acquired talent to get instant, or nearly instant, transfers and promotions to run P&G units.

The difference this time isn't accidental. A person who has spoken with P&G board member Scott Cook said he believes P&G's board is using Gillette to "make P&G a little less incestuous-[Mr. Cook's] words, not mine."

Mr. Cook did not confirm or deny the words, but in an e-mail cast his thoughts differently: "P&G's long-term, promote-from-within policy has served the company well over the years and provides real competitive advantage. ...While not a reason to do any particular acquisition at P&G, acquisitions do have a useful benefit of bringing in additional talent, ideas and perspectives."

One alum still close to the company notes some P&Gers aren't impressed with their Gillette bosses or colleagues. Another, who also heard the grumbling, said it's to be expected, because outsiders getting coveted jobs seems like betrayal to P&Gers who have waited patiently for promotions. Aggravating tensions over such moves, P&G's upward mobility has slowed in recent years as restructurings ended.

In a minor move with potentially major ramifications, P&G recently recruited a brand manager from Kao Brands in Canada. For most companies, no big deal. But P&G never used to recruit from elsewhere. Canada long has been a net contributor of P&G marketing talent to the U.S., and the company often tests things there.

going outside

A P&G spokeswoman termed the information inaccurate. "The only cases where individuals are hired into marketing at the brand-manager level from outside the company are ... as part of an acquisition," she said. But multiple people identified the woman as a former Kao brand manager, and she now has a voicemail account at P&G in Toronto. It's possible, of course, that she took a demotion to assistant brand manager.

Tweaking promote-from-within means P&Gers getting used to new bosses from the outside world-something they've never faced before. The Gillette experiment means much the same thing.

Fresh thinking from Gillette could help P&G. People familiar with both companies describe Gillette as more top down, less deliberative and less doctrinaire. Still, it's not clear another highly analytical, process-driven culture is what P&G needs. And it's not clear how P&Gers will adjust.
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