Health

Don't dismiss the outsourcing megadeal: P&G on how to make them win-win

Interview: Filippo Passerini, CIO and global services officer, P&G

...P&G bought Gillette in 2005. With technology synergies worth $1.2bn between the two companies, the race was on to get the pair integrated as soon as possible - every extra day the project took would equate to $4m lost.

The integration was completed in 15 months: "Normally acquisitions of this nature would take three, four, five years and this was possible because of [the] model, that was possible because of our strategic partners," who were able to add significant resources to the project on the fly, said Passerini.

In addition to speeding the Gillette integration, the IT function has also been responsible for cutting $800m from P&G's running costs in recent years - reducing spend by a third - which Passerini puts down to a combination of outsourcing, operating more efficiently and opening shared service centres in lower cost areas.

"It's much more effective for our business than ever before but admittedly more challenging to manage because it's easier to manage when you have a captive organisation, when you manage by performance reviews, salary increases for merit. Frankly it's an easier ride," he said.

The company has recognised that managing a highly outsourced environment brings its own challenges and trains staff in how to deal with what the CIO calls "this networked world".

But where does all this leave the CIO - just another manager among many?

"I believe personally [the] CIO's role has never been as strategic - as influential, in a way - as it is now or how it could be in the next three, four, five years because an IT professional is positioned outstandingly to make an impact on the business," he said.

"There's a lot of hype around running a business because it's become pretty fashionable to say IT is running as a business, and normally people are simply talking service levels and all the rest. Here we try to run as a business in offering our services to other operating business units at a price, at a cost as P&G offers products to our consumers.

"We try as much as possible not to force, not mandate anything: we want to be so good in the quality of what we do in the capabilities we build in the price that the business units will want to use our services and will want to buy our services for the price because they see so much value."

About

Jo Best has been covering IT for the best part of a decade for publications including silicon.com, Guardian Government Computing and ZDNet in both London and Sydney.

0 comments