P&G CEO David Taylor Talks about how to Unlock Employee Innovation

“In many organizations, including ours, there are processes that a company gets enamored with,” he said. Once a process is deeply ingrained, a company—and, by extension, its employees—can lose sight of the fact that it’s no longer achieving the desired outcome.

The result is a self-imposed confinement that can stifle innovation, behavior Taylor likens to that of a circus elephant. “Sometimes a chained elephant will fight the chain for a while, but then if you cut the chain he will still stay within that circle,” he explains. “If you have processes that encumber people for an extended period of time, then when you change the process they’re like that elephant—nothing changes.”

For an institution like P&G, freeing employees to think and move like entrepreneurs represents a huge shift. After all, the $76 billion company has long been lauded for the deeply instilled processes that enabled it to build household-name brands and gain recognition as a top company for talent development. Yet it’s a challenge that Taylor, who took the helm a year ago in former CEO A.G. Lafley’s second attempt to anoint a successor, views as critical to the company’s future growth.

To achieve it, he’s been traveling the globe working on initiatives that empower people on the front lines in the markets P&G serves. In visiting more than 20 countries in 12 months, Taylor made sure to spend time in the company’s plants and with junior employees or in homes or stores with consumers as well as with the regional manager. “When I fly to Russia, all the people between me and the junior person I meet with in the plant won’t be there—that’s the best way to get a real feel for the business, through the tone and directness of the individuals,” he said. “Part of what leaders have to do is not get overwhelmed by their title and experience and instead recognize that those closest to the consumer and the plants have the insights you need to really make the best decisions.”

As an example, he cites a small P&G research group in Japan that was visiting homes to watch consumers use the company’s cleaning products. Observing several consumers lament the fact that there was no way to clean upholstery as they sprayed the company’s Fabreeze air freshening product on couches and chairs spawned the concept for an “I Wish I Could Wash” ad campaign. “The U.S. ad showed someone putting a couch on top of a car and taking it through the car wash,” recounted Taylor. “The category went from declining 3 percent to growing almost 10 percent and we particularly prospered. That whole idea came from junior people in homes observing customers interacting with the brand. It would not have come up in our Cincinnati headquarters.”

A 36-year veteran of the company, Taylor demonstrates an insider’s understanding of the hurdles P&G needs to overcome in encouraging more of such insights to bubble to the surface. To skirt them he touts P&G initiatives like “Straight Talk,” which fosters the kind of honest feedback that can lead to constructive change. “The environment we create to get feedback has a tremendous affect on the quality of the feedback you get,” he explained. “When someone gives you tough feedback and you react and your face changes, then you don’t get great feedback anymore. On the other hand, when you can truly invite feedback and take it as its intended, not how it feels, which is really hard for all of us, that’s when the quality goes up and you get critical thought.”

Taylor is convinced that it’s only by proactively nudging employees to question and challenge existing processes and share their ideas freely that a large company like P&G can become more agile and innovative. “We ask people, ‘If you owned the company what would you do?’” he explained. “’If you started this business across the street, would you do things this way?’ As a leader you have to create the environment that gives people the courage to step out and make the future different than the past.”

Note: Look for additional coverage of the CEO Talent Summit online and in the January-February 2017 issue of Chief Executive magazine.