February 8, 2013 Lydia Jacobs-Horton, Director, Global Facilities & Real Estate, GBS
P&G at a Glance • Founded 1837 • Countries of Operations 75 • Countries Where Our Brands Are Sold 180 • Consumers Served by Our Brands 4.6B • FY2011-12 Net Sales $83.7B
50 Leadership Brands • Among the world’s best -known household names. • Represent 90% of P&G sales, more than 90% of profits. • Includes 25 billion-dollar brands.
Our Purpose To improve the lives of the world ’ s consumers, now and for generations to come.
Global Business Services Worldwide Operations • GBS not just IT or HR… but all aspects of business • Employee Services and Business Services across 75 countries • Driving innovation and scale
F&RE at a Glance 75 Countries of Operations Total Properties > 1,000 Office & Technical Center Properties 130 F&RE Employees 70 JLL Employees (excluding service staff, eg, dining , cleaning) 700 Responsible for Global: Real Estate Strategy & Transactions Office + Technical Ctr Operations Office + Technical Ctr Capital Projects
Jones Lang LaSalle at P&G Facilities Management & Real Estate • • Global Agreement est. 2008 Global Agreement est. 2003 • Portfolio Strategy and • Facilities operations Occupancy Planning • Hard & soft services, meeting • Transaction Management services, project (buy, sell, lease) management, space & • Lease Administration occupancy planning • 130MM SF P&G Portfolio - • 17MM SF fully managed office/tech/plants/DCs portfolio - office, tech ctr, salons • F&RE IT
P&G Facilities & Real Estate Jones Lang LaSalle Global Leadership Team JLL Real Estate Jones Lang LaSalle Services Facilities Services Soft Services Transaction Portfolio Facilities Project & Employee Management Management Operations Management Amenities
Operational Excellence is Base
Operational Imperatives • Support P&G business on a highly reliable basis • Exceed stewardship objectives: Risk Mgmt, Quality Assurance & Fiscal Controls • Protect, maintain and increase long-term asset value of P&G’s property • Innovate to drive business effectiveness and employee productivity 10
Applying P&G Proven Business Model to Improve Results Focus on 40/20/10 Winning with Innovation Improving Productivity
Developing Markets Market Growth Potential • Population is forecast to grow 800 million people with ~95% from developing markets • ~1.4 billion new middle class consumers in developing markets by 2020 • Americans currently account for 20% of middle-class spending & are expected to represent only 8% by 2030
FY P&G Results Organic Sales Growth led by Developing Markets Developing Developed FY 09 FY 10 FY 11 FY 12
Developing Markets Start Ups FY ’13 & ‘14 New Plant New Category Start-ups Start-ups • China • Poland • Brazil • Venezuela • Indonesia • India • Nigeria Planning Centers Technical • Cairo Centers • Warsaw • Singapore • China • San Jose
Regional Demographics Asia WE Asia WE CEEMEA CEEMEA LA LA NA NA JLL F&RE Notes: Challenge: Develop F&RE expert • JLL Excludes: dining services, cleaning, mechanics resources in areas of highest complexity • CEEMEA & LA - highest dispersion • CEEMEA & Asia - highest complexity, demand
Improving Productivity and Creating a Culture of Productivity $ 10 billion $ 3B OVERHEAD $ 6B Our productivity and cost savings plans will help fuel top-line growth, COST OF GOODS ensure our consumer value $ 1B propositions are superior, MARKETING overcome macro headwinds and deliver better bottom-line growth
Productivity Plans Overhead $3 bn Overhead Opportunity Organization Design & Simplification • Eliminating duplication of work • Simplifying through Digitization • Optimizing number of Business Units & Functions • Optimizing our Global Footprint
Strategic Portfolio Management Enables Real Estate Optimization in a way that… • Enables faster/better decision making via enhanced analytics, clear accountability, stronger business unit connections and proactive planning. • Establishes on-going, proactive strategic real estate plans developed in partnership with business leaders. • Focuses real estate decisions on P&G as an enterprise versus individual business units.
NA MDO TIER 2 BH&WB NETWORK ( Various locations, USA) REAL ESTATE NETWORK STRATEGY SHEET NETWORK DETAIL Owning BU : MDO - NA Site Contact(s): MDO AD Finance Mgr HSE Mgr MDO Engineering Operations Mgr Cheryl Mckettrick Carla Allen/James Sean Broderick Andy Poole/Carlos Skip Tappan Chung Shipley Portfolio Snapshot: Facility Size (sqft) Leased/Owned/3PL Expiration Operator Lease $/yr ** AU KPI (10/11 FY) West Branch DC n/a Schenker n/a 0.37 781,800 Owned *NA DC SPACE Rummels DC 6/19/2017 Schenker 1,543,263 0.37 514,957 Leased ~25.5 MM sqft BuncherDC 12/31/2016 Schenker 1,104,135 0.37 346,062 Leased NGW DC 5/31/2013 Schenker 1,190,000 0.37 350,000 Leased leased CP2 1/31/2017 Schenker 1,750,303 0.32 504,000 Leased 41% Owned $29.2MM/yr CP3 12/31/2012 Schenker 969,827 0.32 243,800 Leased 59% BROWNSUMMIT ONSITE n/a P&G n/a 0.32 820,000 Owned SWINGRD ONSITE DC n/a n/a n/a ~210,00 Owned ** Base rent only NETWORK MASTERPLAN * All DC space, incl. @plants • 1-2 YEAR MASTERPLAN HIGHLIGHTS – Maintain Option on land adjacent to Rummels DC – Extend option if necessary • 3-5 YEAR MASTERPLAN HIGHLIGHTS – eliminate NGW & Buncher and build-to-suit in West Branch; optimize GBO outside *MDO TIER 2 SPACE warehouses – optimize Corporate Park distribution center ~7.2MM sqft • CROSS-BU OPPORTUNITIES/PLANS – have considered most recently with Home Care and Brantford CDC; none yet. Pet Care to take space at Swing Road for OND and considering long-term use. Owned OPPORTUNITIES/RECOMMENDATIONS/HELP NEEDED 25% • CP3 to be subleased to CM. COP/reco in progress • IC/GBO – evaluate network optimization at both networks (per IC) – ON HOLD • IC – what can we do to accelerate savings? Per Cheryl, Skip and Darin are looking at options to accelerate savings. leased • Buncher termination option extended 1 yr (Dec ‘11) with plan to be out by Feb 2013. NEW ROOF APPROVED ($3.5MM)! 75% AU KPI Measures (TBA) Total MDO RE Cost Savings $MM (Hard Savings only) Cube fill Capacity Asset Pallets/m 3 * MDO managed space only rate Utlization $/pallet 07/08 08/09 09/10 10/11 11/12 tba tba tba tba 0.295 0.06 0 0.918 TBA
Innovation in Analytics Howard Berger Managing Partner, Realcomm Top 45 People to Watch in 2013 We believe that with the new paradigm shift towards automation and technology changing the way we manage and operate commercial real estate, it is the commitment of these visionaries that will pave the way for future success. Here are the individuals and teams to watch in 2013: … Teams: … P&G: : Dave Tufts, Jon Hodgdon JLL: Dave Johnson, Dan Probst, Chris Browne, Dipesh Shah …
Innovation in Workplace Design DIGITAL WORKPLACE CURRENT BEST APPROACH DRAFT
01 INTRODUCTION “It’s time to go beyond current organizational flexibility programs and approach Flexibility as a necessary broad scale business strategy.” Bob McDonald, Chief Executive Officer
01 INTRODUCTION VISION Work is what you do, not where you do it. WIRELESS THE SERVICE DATA, VOICE EXPERIENCE AND VIDEO The new digital workplace SOLUTION design puts the employee at the center of an integrated solution to enable them to work at peak performance – wherever and whenever they EMPLOYEE choose The future workspace promotes collaboration, DIVERSE embodies flexibility and COLLABORATIVE WORKPLACE provides advanced ENVIRONMENT BEST PRACTICES technologies. It supports a global workforce allowing choice and striving for no waste of space, time or resource. It empowers employees to HEALTHY AND SUSTAINABLE choose the workspace that VISUALLY ELEMENTS best fits their need at STIMULATING DESIGN anytime. page 23 page 23 P&G DIGITAL WORKPLACE P&G DIGITAL WORKPLACE
02 DIGITAL WORKPLACE THE WAY WE WORK IS CHANGING New technologies, shifting demographics, and a Global marketplace are requiring the workplace to quickly change and adapt. In order to stay ahead of the competition we need to have our workplaces ready to support the following demands: Variety Interaction Transparency Collaboration Innovation Mobility User Experience Flexibility Productivity Wellbeing Sustainability page 24 page 24 P&G DIGITAL WORKPLACE P&G DIGITAL WORKPLACE
03 INTEGRATED DESIGN AN INTEGRATED & HOLISTIC APPROACH The concept of Digital Workplace is an integrated and holistic approach using a combination of Space Design, Skills and Infrastructure. The objective of reducing real estate costs, optimizing investments in modern technologies and improving organizational flexibility to respond to current and future workforce demands. DW page 25 page 25 P&G DIGITAL WORKPLACE P&G DIGITAL WORKPLACE
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