In our latest Dialogue with a thought leader in global manufacturing, Procter & Gamble’s president of Global Business Services and CIO, Filippo Passerini, explains how global outsourcing and innovative business models will help the CPG giant reach another billion customers.
It’s been more than 170 years since two European immigrants, an English candle-maker and an Irish soap-maker, married two Cincinnati sisters and heeded their father-in-law’s advice to form a business partnership: Procter & Gamble. The humble family business they began in 1837 has since become the largest consumer products group in the world. Today, the $77 billion company is on a global mission to reach a billion more customers worldwide and fuel 5% growth every year.
In an interview with Manufacturing Executive, Procter & Gamble’s president of Global Business Services and CIO, Filippo Passerini, tells Executive Editor Paul Tate about digitizing the company, and how combining a revolutionary approach to service-driven IT with a forward-thinking pursuit of innovative, digitally rich, new business models helps support P&G’s quest for growth.
Q: How does P&G’s Business Services group drive market success?
A: On one hand, we aim to make the company more and more efficient and to operate cost-effectively. On the other hand, we want to create breakthrough opportunities in innovation. So the role of shared services is to support all the operations of P&G around the world, whatever is shared between all the operating business units. But we’re also responsible for innovation on the technology side and creating new business models.
In manufacturing, specifically, it is ensuring that technology enables a fast changeover in the production line and captures information to populate decision support systems, which, in turn, allows us to eliminate faults and operate our manufacturing facilities, manufacturing systems, and processes much more effectively.
Q: What excites you about your role at P&G?
A: It’s the ability to help the business operate more and more spontaneously, in real time. We are the largest CPG company in the world. We operate in most markets worldwide. We have more product categories than all of our competitors, so the opportunity that we have is to leverage our scale. To do that, we need to digitize the way we work and constantly operate our systems more and more in real time, which means eliminating interfaces, eliminating “sames,” eliminating downtime. That’s what operating in real time is all about. That’s the challenge.
Q: So what keeps you awake at night?
A: The big challenge is that we are already an $77 billion organization, and we want to continue to grow 4, 5, or 6% per year. That means we need to add $4-5 billion a year to our revenues. And we want to reach more markets worldwide, so we’re on a quest to reach another 1 billion consumers. As you can imagine, technology will play an instrumental role here because we need to be able to provide more and more products through distributors who operate in developing markets. This is certainly a challenge.
The other issue is that although we are an $80 billion company, how can we make it operate like a nimble $10 billion operation? It isn’t either we’re big or we’re flexible. We need to be big because this gives us a lot of scale, but we also want to be agile.
