Article from Business Week-How Proctor and Gamble Retains Great Team Members

By Roger O. Crockett

Few employers spend as much time cultivating their workforce as Procter & Gamble (PG). The consumer-products company expects to get 400,000 applications for entry-level management positions this year. It will hire less than one half of 1% of them, selecting only those most likely to fit the P&G culture. "We actually recruit for values," says Chief Operating Officer Robert McDonald. "If you are not inspired to improve lives, this isn't the company you want to work for."

The careful vetting, training, and career development pay off. P&G boasts 23 brands with at least $1 billion in annual sales and is the market leader in everything from detergent to diapers to razors. True, the company's renowned marketing skills and deep pockets help. But another important edge is personnel management—bringing in and promoting creative thinkers.

INTENSE INTERNAL TRAINING

The P&G strategy starts on college campuses. The Cincinnati company dispatches line managers rather than human resource staffers to do much of its recruiting. They home in on schools whose earlier graduates have moved up at P&G, such as Harvard and Stanford. Interviewers look for what they call a candidate's "power," including leadership ability and empathy. Innovation skills and values are measured in an online assessment. "Our managers are skilled at probing for the right fit," says William Reina, director for global talent. "The people they identify score well on the assessment."

For the few who get hired, their work life becomes a career-long development process. At every level, P&G has a different "college" to train individuals, and every department has its own "university." The general manager's college, which McDonald leads, holds a week-long school term once a year when there are a handful of newly promoted managers. Further training—there are nearly 50 courses—helps managers with technical writing or financial analysis.

Career education takes place outside the classroom, too. P&G pushes every general manager to log at least one foreign assignment of three to five years. Even high-ranking employees visit the homes of consumers to watch how they cook, clean, and generally live, in a practice dubbed "live it, work it." Managers also visit retail stores, occasionally even scanning and bagging items at checkout lanes, to learn more about customers. Rosabeth Moss Kanter, a professor of business administration at Harvard Business School, says this level of involvement by executives is rare. But that's what separates P&G from the pack.