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Chicken or Egg –Standard System orStandard Processes,which comes first?
P&G’s Journey to get theright data, in the right place,at the right time - Globally
Out
line P&G's Business1
23
What we’ve learned in the TPM area
Our Journey
4 Some Key Learnings &Results
175 Years of GrowthP&G celebrated a milestone in 2012 that very fewcompanies have achieved: its 175th anniversary.
The Company was founded in Cincinnati in 1837 by William Procterand James Gamble a candle maker and a soap maker who starteda small business that has grown into one of the world’s mostadmired companies and includes brands that have becomehousehold names, used and trusted by consumers every day innearly every part of the world.
Today, P&G is the world’s largest and most profitable consumerpackaged goods company.
P&G Quick Facts P&G brands touch the livesof 4.6 Bn. people around theworld ~$84 Bn. revenue (2012) 300 Brands sold in over 180countries 25 Billion dollar brands Operations in over 80countries ~60% revenue from outsideNA - 38% from developingmarkets 126,000 Employees
P&G Trade Promotions - Quick Facts Program runs a fiscal year cycle in +180countries Number of promotions per customer / yearrange from <10 to 3,000+ Promotions can be for a single brand, or up tothe P&G family of brandsPromotion length varies by typeFunds may be settled in various waysMonies are typically paid in local currencyMultiple “activity types”Strategies for multiple customer formatsImpacts both local and US GAAP reporting
P&G Trade Promotions - Quick Facts• Run year round in close to 180 markets• Number of promos for each customer / yearranges from 10 to 1,000+• Multiple brands involved in a singlepromotion (From 1 up to 20)• Promotions often involve multiple“activity types” ie Display +instore consultant + price.• Different promotion strategies fordifferent
What we’ve learned…
SummaryWork Process Standardization is keyAdvanced Trade Promotion control, analysis and optimization is nolonger optional The information required for promotion and investment optimization isHIGHLY complex
• US data fundamental but insufficient: >60% revenue from outside•This data is highly volatile•Commercially available data is not always available•Most of this data cannot be automated: It’s in the manufacturer’s sales rephead and/or Retailer buyer
Unlike other “systems” projects the users can avoid using the TPMsystemFocus has to be on the E2E processes, not just promotion managementThere is a significant impact to the selling organization – key to successis strong sales leadership
•Following BIC processes and getting the required information isextremely taxing to the sales organization•Data now being visible is an issue
The Goal: Optimizing our trade spendglobally
Our journey of 10 years and counting…
1. Key Program Considerations2. Building the foundations : Align
externally with Customers3. Standardize internally: Systems,
measures and processes4. Minimize impact to organization
especially the sales force
External Alignment with Customers –P&G Terms harmonization
Foundational work – Essential
Align P&G promotional guidelines with customers:
• Performance and proof of performance requirements
• Funding principles and guidelines
•Payment Options
Active sponsorship from top leadership required Huge task (effort, time and $) Identify (or design) best practices and “globalize”fast Start with good (not perfect)and evolve
Internal Harmonization: Processes,measures and systems
Minimize impact to the organization –especially the Sales Force
Crawl / Walk / Run Apply Shared services concept to salesprocesses Leverage P&G’s collaboration strength/strategy Partner with best in class partner to optimize thetransactional steps Map processes: identify key strategic steps vsadministrative / transactional
Optimizing the transactional steps:Collaborating with partners to collaborate with our customers
Leverage partner’s operational excellence
Strategy: Lift and shift Stabilize Optimize
P&G’s sales force continues to focus on
strategic things
Partner manages system and administrative
complexity
Some Results…and still counting….
40-50% efficiency gain for sales in reported E2Epromotions and payments management time 10x reduction of payment errors 100% SLA compliance and data qualitymeasures Significant increases in quality of data availableforanalysisSimplified approach to changes inprogram specificsOperations charges are up