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IT as a competitive advantage
at Procter & Gamble
October 28, 2008
Remco Brouwer, Procter & Gamble
Information & Decisions Solutions
Agenda
Introduction to P&GIT: From Commodity to Strategy
Using information to win in the market
Q&A
Agenda
Introduction to P&GIT: From Commodity to Strategy
Using information to win in the market
Q&A
P&G at a Glance • Founded 1837
• HQ in Cincinnati, Ohio• $83.5 Billion annual sales• 138,000 employees• More than 300 brands sold
in 160 countries • Operations in more than 80
countries• “Fast Moving Consumer
Goods” industry
Brands sold in the Netherlands
FMCG: Ariel, Dash, Dreft, Lenor, Swiffer,Antikal, Febreze, Pringles, Pantene, Herbal Essence, Head & Shoulders,Wella, Oil of Olaz, Max Factor, Oral-B, Vicks, Pampers, Kandoo, Always, Alldays, Tampax, Envive, Gillette, Braun, Duracell, IAMS, EukanubaFragrances: Hugo Boss, Lacoste,Laura Biagiotti, Mexx, Gucci, D&G ….
An average supermarket in the Netherlands has over 300 P&G products in its assortment
P&G’s 24 Billion-Dollar Brands
Some of our core values
Consumer in the center of everything we do
Superior products, focus on R&D
High speed to market
Leverage our scale as much as possible
Focus on two key moments
In storewhere the
shopper chooses
First MomentOf Truth
At home where the consumer
uses our products
Second Moment Of Truth
Shopper Understanding“Customer Business Development”
Consumer Understanding“ R&D, Marketing”
Agenda
Introduction to P&GIT: From Commodity to Strategy
Using information to win in the market
Q&A
Innovation in Business Services…P&G’s Challenge
Global expansion, between 1985 and 1999 we had • Entered 55 new markets• Increased operations to 86 countries
We saw…• Duplicated services across regions• Structural inability to take advantage of economies of scale
• Inefficiently allocated staffing and budgets
We Knew:• Much of technology was becoming a commodity…• Often, IT was seen as a cost…• IT had the potential to do so much more…
• And the business need was so much greater…
Innovation in Business Services…The IT Challenge
TechnologicalCapabilityBusiness Needs IT
We set a goal . . .
Transform IT from Back Office Support to
Board Room Strategist and
Offer P&G a strong foundation for growth...
Our Approach
UNITE IT and core Business Services
DRIVE synergies across Business Services
SHIFT THE THINKING from “technologies” to “solutions”
UNLEASH the potential of the back office as a business driver
GBS was born…
Global strategy for products,
Marketing, R&D,& Manufacturing
Customer relationship; local
marketing & consumer
understanding.
Employee & business services, IT infrastructure,
processes & business support
across P&G
Cross-functional support: HR, PS,
Finance and Accounting, CMK, Design, External Relations, R&D,
Legal, CBD
Business Implications:• Duplicated services across regions• Inability to take advantage of scale• Inefficient staffing and budgets
Going Global: BeforeOur Starting Point - A Scattered Structure
In 1999:Brands / Business Units operating “independently”
Business Services:“Localized” and dispersed among business units, brands, geographies
Going Global: AfterGBS Service Centers and Data Centers
Cincinnati
San Jose
NewcastleBrusselsBrussels
SingaporeManila
Business ServicesEmployee Services
Global Service Lines
• Employee Services
• People Management
• Facility Services
• Computers & Communications
• Meeting Services
• Travel Services
• Strategic Sourcing & Procurement
• Financial Services & Solutions
• Product Innovation Solutions
• Supply Network Solutions
• Consumer Solutions
• Customer Solutions
• Initiative Management
• Business Performance Solutions
• After the creation of GBS we needed: Another big step in our business model
• What we realized: Could grow stronger, faster if we tapped into external partners
Growing in Partnership
Leverage our best, with their best . . .
Employee Services
IT Infrastructure + Applications +Transactional Accounts Payable
Facilities Management
• 3 Partnerships$4.2 billion agreements 11 months start-to-finish
• Best-in-class industry leaders
• Strong commitment to partnership
• Clear measures for success
Growing in Partnership
Agility
• Together: 1100 projects
• Completed: in 15 months
• Synergy Savings: $1.2 Billion
Within 2 weeks, our partners added 700 full-time people to the P&G business
GBS Running as a BusinessBorrowing from P&G’s Management Practices
“Total User Experience”Consumer Benefits
Service ManagementBrand Management
Value CreationSales Volume
Service LevelsMarket Share
CostProfit/LossGBS EquivalentsP&G’s Approach
From technology to solutionsFrom what’s needed to what’s
possible
Information Our unique asset Decisions What we want to enableSolutions What we want to deliver
And a new name for our IT organization:
IT Strategies
Business Needs
IDS
GBS Running as a BusinessWhat this transformation meant to IT
Agenda
Introduction to P&GIT: From Commodity to Strategy
Using information to win in the market
Q&A
Replace physical product mock-ups with virtual reality applications
Commercialization:
Consumers: focus-group mock-ups replaced by virtual designs
Customers: increased engagement with virtual shelving
Engineering and Production: modeling
Our Virtual Solutions tools were used on 79% of all P&G initiatives
Example 1
Virtualization at Work
Work with our customers to better understand and serve the shopper
Example 2
Customer CollaborationUse the following data types:
• Point of Sale Data
• Loyalty Card Data
• Household Panel Data
• Market Share Data
We have global systems to load, enrich, store, integrate and analyze these data types. Key theme : From data to information
Decision Cockpits:• Revolutionized
delivery of business information
• Empowers executives to anticipate what is happening in the business
• Available to everyone, based on a common data set
Example 3
Decision Cockpits
Running as a BusinessReal Time Decision Making @ Work
• Revolutionize delivery of business information by anticipation
• Available to everyone
• Eliminate / reduce “standard reports”
• Anticipate what is happing in the business
Example 2
Need image of a cockpit here
Decision Cockpit
My Reports
My CockpitGM Net (RSS Feed)Alerts Shipments - Quick Overview
• LonDarco down 4% thisquarter.
• Shipments 2.25% behindexpectations.
• Action Plan meetingannounced.
View old alerts…
http://decisioncockpit.pg.com/shirley
NA Market Measurement - Control Chart
SRAP
Competitive Intelligence
My Links NA MDO ScorecardConsumer• Media Coverage• Commercial Innovations• Claudia's Design Blog• Marketing Net
Customer• Top Customer Stock Quotes• Retailer Brands• JVC-CDSN
• All Outlet Share - US Market -through Aug 2006P&G (including Gillette)US All Outlet P3M valueshare ending August 2006 is estimated.
• Board of Directors Share Reports - July '06Globally, X of X Categories are flat or growing share in the Past X Months vs. Year Ago.
Choose Region:
Global
NA Daily O&S Report
• CEMEA Monthly –one day ago• NEA Monthly –one day ago• LA Monthly –three days ago• WE Monthly –five days ago
My NewsStand Folders
Fabric Care - Multicompanies - North America - Competitors
• HSBC Investor Global Fixed Income Fund - Class I - Part 1 • Unilever Announces Third Quarter and Nine Month Results 2006 and Interim Dividends • Unilever changes claim 265 suburban jobs
Decision Cockpits
Running as a BusinessReal Time Decision Making @ Work
• Revolutionize delivery of business information by anticipation
• Available to everyone
• Eliminate / reduce “standard reports”
• Anticipate what is happing in the business
Example 2
Need image of a cockpit here
Decision Cockpit
My Reports
My CockpitGM Net (RSS Feed)Alerts Shipments - Quick Overview
• LonDarco down 4% thisquarter.
• Shipments 2.25% behindexpectations.
• Action Plan meetingannounced.
View old alerts…
http://decisioncockpit.pg.com/shirley
NA Market Measurement - Control Chart
SRAP
Competitive Intelligence
My Links NA MDO ScorecardConsumer• Media Coverage• Commercial Innovations• Claudia's Design Blog• Marketing Net
Customer• Top Customer Stock Quotes• Retailer Brands• JVC-CDSN
• All Outlet Share - US Market -through Aug 2006P&G (including Gillette)US All Outlet P3M valueshare ending August 2006 is estimated.
• Board of Directors Share Reports - July '06Globally, X of X Categories are flat or growing share in the Past X Months vs. Year Ago.
Choose Region:
Global
NA Daily O&S Report
• CEMEA Monthly –one day ago• NEA Monthly –one day ago• LA Monthly –three days ago• WE Monthly –five days ago
My NewsStand Folders
Fabric Care - Multicompanies - North America - Competitors
• HSBC Investor Global Fixed Income Fund - Class I - Part 1 • Unilever Announces Third Quarter and Nine Month Results 2006 and Interim Dividends • Unilever changes claim 265 suburban jobs
Real Time Decision-Making at Work
End to End Reporting Services:• Enabling better local decision making
by integrating data from different (global or local) sources
• Turn data into actionable information
• Display the information following local business / market structures, use a “simplified version of the truth”
• Deliver the information through our global decision cockpits
Example 4
Tailored reporting where needed
Began as support for one siteBuilt pampers.cominto the most successful marketing site in the Company49 countries, 50% of world’s population26 million visitors a year
Reapplying customization to advance other brands in the Company.
Example 5
Personalization at Work