Procter & Gamble CIO: improved supplier dialogue vital to our success

The chief information officer at Procter & Gamble has told Computerworld UK that a dramatic change in the way the company interacted with suppliers has meant IT delivers better business results.

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The chief information officer at Procter & Gamble has told Computerworld UK that a dramatic change in the way the company interacted with suppliers has meant IT delivers better business results.

Filippo Passerini said the consumer goods company, which in the UK sells brands including Gillette razors, Pampers nappies, Wella shampoo and Ariel washing powder, is creating business plans more closely with suppliers and has begun giving them better long term incentives.

A change had become necessary as existing dialogue “sometimes focused around squeezing the most out of suppliers” but there were concerns it would not always nurture successful longer term partnerships, he said.

Passerini said SAP-based P&G, which employs 138,000 employees in 80 countries, now offers more incentives to suppliers and works closely with them on their long term account goals.

“We want collaborative partnerships, not just the traditional getting the most out of suppliers,” he said, at Forrester’s Services and Sourcing Forum in London. “With the right collaboration, we can reduce the cost, increase quality and scalability, and improve our abilities to innovate.”

P&G has made $600 million of cost savings in the last three years, Passerini said, and launches eight times as many high tech initiatives each year than before.

In 2003, P&G signed a range of long-term, multibillion dollar IT deals, with HP for infrastructure management and transactional accounting, IBM for human resource services and Jones Lang LaSalle for facilities management. It also works with BT for infrastructure management, and Infosys and Tata for business process management.

 
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