Procter & Gamble (P&G), one of the world’s foremost consumer goods conglomerates behind household names like Gillette, Tide, Bounty, and Pampers, recently announced a significant workforce reduction, cutting around six percent of its global headcount. This move, part of a broader strategic restructuring, underscores the company’s continued push towards operational efficiency amidst a challenging economic landscape marked by tariff uncertainties, fluctuating consumer sentiment, and evolving retail dynamics.
The job cuts, focusing primarily on non-manufacturing roles, align with a broader plan to streamline operations, reduce costs, and accelerate the digital transformation of P&G’s supply chain and marketing operations. While the conglomerate has attributed part of the restructuring to anticipated negative impacts from potential tariff changes, it is clear that automation and artificial intelligence (AI) integration play a pivotal role in reshaping the workforce and processes. The announced divestment of certain brands and categories, coupled with increased automation and digitalisation, aims to create a more agile, efficient, and future-proof business.
Central to P&G’s strategy is its Supply Chain 3.0 initiative, an ambitious, enterprise-wide programme designed to build an optimised, sustainable, and flexible supply network. By leveraging advanced data analytics, AI, machine learning, and automation, P&G is transforming how it manages everything from production and inventory to transportation and retail shelf availability. This digital transformation is not a superficial tech upgrade but a deeply integrated approach to boost consumer satisfaction and operational productivity.
Through AI-infused operations, machine learning algorithms analyse historical data and real-time market conditions to enable precise demand forecasting, optimising inventory management and reducing both stockouts and overproduction. Autonomous technologies are increasingly being deployed in warehousing, such as robotic arms and automated guided vehicles, expediting order fulfilment and improving accuracy. Alongside this, AI-driven quality control using machine vision systems ensures higher manufacturing standards, while predictive maintenance minimises downtime, enhancing overall equipment effectiveness.
P&G’s leadership reiterates that increased digitisation is a means to an end—consumer delight and operational excellence—rather than a tech play for its own sake. As stated by the company’s senior vice president of product supply operations, millions invested in technology must target clear outcomes; otherwise, they risk wastage. This measured approach is reflected in the substantial productivity gains realised through Supply Chain 3.0. For instance, automated shipment check-ins have cut what was once a multi-day manual process to mere minutes, delivering over 99% effort savings and freeing resources for more complex tasks.
Complementing its supply chain transformation, P&G is harnessing AI to revolutionise advertising and retail execution. The company’s proprietary Consumer 360 data platform and programmatic media buying enable targeted, efficient ad delivery, increasing US average media reach from 64% to 80% over five years. Meanwhile, AI-driven analytics optimise retail shelf space, online content, and search advertising, creating a seamless and engaging consumer shopping experience both online and offline.
Pilot projects under Supply Chain 3.0 showcase a commitment to sustainability and innovation. In one North American trial, driverless trucks covered over 320 miles between a plant and warehouse, hinting at future scalability. In another, a partnership with a Canadian retailer eliminated ‘empty miles’ in transport logistics, reducing emissions and boosting shelf availability. Autonomous mobile robots have cut truck loading and unloading times significantly, demonstrating how automation tangibly enhances productivity and service quality.
Financially, the company has forecasted a gross cost of goods sold savings of up to $1.5 billion before tax via these efforts, with AI and automation poised to contribute hundreds of millions more through optimised truck scheduling, route planning, and dynamic sourcing. Despite this, P&G has moderated its growth outlook for 2024, projecting organic sales growth at 2%, down from an earlier 3–5% forecast, reflecting the broader economic headwinds and market uncertainties it faces.
Overall, P&G’s ongoing transformation is a multifaceted endeavour spanning workforce reductions, technology-driven efficiency gains, sustainability initiatives, and enhanced consumer engagement. While the restructuring signifies a leaner organisational footprint, it also reflects an adaptive strategy to maintain competitiveness in an increasingly complex global market. The company’s deft integration of AI, automation, and data analytics within Supply Chain 3.0 and beyond positions it well to navigate future challenges while continuing to deliver value to consumers and shareholders alike.
Source: Noah Wire Services
