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In his twenty-seven years at P&G, one thing has been constant for Filippo Passerinihis pursuit of excellence. And in these years, he has held a series of leadership positions in the UK, the US, Greece, Italy, Latin America, and Turkey before taking the leadership of P&Gs Global Business Services (GBS) organization.

GBS is responsible for providing key business support and solutions to 138,000 P&G employees working in over eighty countries worldwide.

Passerini has earned his doctorate in statistics and operating research. On being asked about his passion, he replies, I am passionate about learning as I believe you can always do better or do more. Lessons can be learned in every aspect of life. In my youth, I used to play competitive chess. This taught me that you can only think so long; at some point, you need to move. This lesson is extremely relevant to the work we do at GBS. In a world that is accelerating faster than ever before, we must be able to develop our strategiesand actquickly. Little wonder, till date, GBS already has saved the company more than $600 mn through shared services alone.

Passerini is an avid mountaineer in his real life and has scaled three peaks higher than 15,000 feet. He lives with his family in the US, working in P&Gs Cincinnati headquarters. In an extensive interaction with Dataquest, Passerini talks about various issues that are critical to the success of the company that was founded in 1837, and currently has 23 brands that have more than $1 bn in net annual sales. Excerpts

How is IT used to string together a mammoth enterprise like P&G?
When we set out on our journey, we had a clear IT vision. We wanted to bring the back office to the boardroomleveraging IT as a driver for business transformation and growth. The approach we took was global, holistic, and founded on partnership. First, we looked beyond IT, positioning ourself as the go to organization, for all key business services. Today, our Global Business Services organization covers over eighty-five services in the areas of employee services, finance and accounting, strategic sourcing, facilities management, and consumer relations.

Secondly, we decided early to globalize our operations. We standardized seventy-two systems in seventy markets in just three years and focused work in six global service and data centers.

Filippo Passerini, Chief Information and Global Services Officer, P&G

Finally, we reached out to grow relationships with strategic partners who support us in our work. Our IT partnership with HP is a great example here. Together, we have not only achieved above-projection cost savings with better services, but have also been able to tap into HPs innovation capabilities, and become much more agile.

In this way, we have established ourself as one of the four core pillars of P&Gs business supporting P&G employees around the globe.

What are the key learnings?
Let me highlight the three lessons that stand out the most: First, it really helps to run as a businessfrom the outset we looked at ourself not as a support service, but as a business. By talking and operating as a business, we earned a seat at the business table.

The second is that you really do get what you measurewe have established indicators to measure service levels and cost across all our service lines and everyone (including our partners) is accountable to a Scorecard against which we track progress. This helped us drive accountability across the organization and focus our intent.

And the third lesson is that focus is pricelessthe clarity of our vision at the outset combined with clear priorities and measures established year on year, has proved a powerful driver at each and every stage in our evolution. As we continue to evolve, we continue to learn too. At the end of the day, it is that learning that drives innovation forward.

P&G has outsourced different functionsan infrastructure management contract with HP; a $400 mn, 10-year deal with IBM and HR services; a five-year agreement with Jones Lang LaSalle to handle P&Gs facilities managements; and a five-year deal with Sykes Enterprises to outsource customer care, CRM applications, and global fulfillment services. What has been the vision behind outsourcing these functions?

In 2002, we recognized that our Global Business Services model needed to grow in two significant ways; namely, to grow new business building capabilities, to create new value creating services. And, to create greater agility within our organization structure, putting even greater focus on upstream work. Flexibility and agility became key factors.

Our decision to outsource to partners offered us a strong foundation for this growth. As I see it, outsourcing adds value in a number of ways. It opens up opportunities to reduce costs further. It allows for improvements in overall service quality, as we share and grow expertise with our partners. And, at a more strategic levelwhich is what drove usit offers flexibility and agility.

Over the past years, P&G has acquired and merged different companies, how are the disparate systems harmonized? Is there a standard procedure?
This is a great question as it really touches on how IT can provide a strong foundation for business growth: enabling the business to scale up or down as necessary, driving synergies, and supporting new business building capabilities.

Our acquisition of Gillette in 2005 offers an interesting case study. At the time, P&G saw synergy savings of $1.2 bn per year, which translated to $100 mn per month, or $4 mn per day. Working with our partners, we were able to complete the integration in just fifteen months. This process would easily have taken three to four years under a more conventional set-up.

What we learnt was that having an organization that brought together all key business services proved a structure for success. Key areas like IT, employee services, and facilities management were already together in the same organization and could easily connect. We didnt need to get to know each otherwe could move ahead and use our networks to make the integration happen.

The other thing we learnt was the power of our outsourcing partnerships. To achieve what we did would have required a headcount of 700 additional people. We didnt have these resources in-house and it would have been impossible to hire, train, and effectively establish this number of people in a short timeframe. But, together with our service partners, we were able to put together a first class team within a matter of weeks.

This is what I see as vital in todays model; the ability to be flexible, to augment, or reduce as our organization requires. Its an incredibly powerful tool.

How strategic is IT to the change management process considering that P&G has a history that goes back to the nineteenth century?
Change management is something that is embedded in our culture at P&G after all we have been at it for 170 years. Throughout these years, change has been constant and, if growth rates are a guide, we have managed pretty well.

In the IT area, one of our strategies has been to strive to anticipate the future so that we stay ahead of change. Concretely, this means tracking emerging business trends and working to manage them pro-actively. To take one example, when we first saw the trend for personalization, we asked ourselves how this would impact knowledge management. This led us to build personalized decision tools that we have rolled out to executives across the company. So, both on the screen and on the handheld, executives can get the business critical data they need at their fingertips. This has cut down the production of over 20,000 individually made reports. Additionally, we have increased accuracy as all data feeds off a consistent data set.

P&G is also investing in analytical software and predictive modeling tools to help its business leaders better understand the markets it serves. What are the challenges in designing a robust BI solution? Are you going for an in-house or off-the-shelf solution?
Business analytics is an area where we have invested. Our vision is to use innovative technologies to help us work smarter, faster, and more efficiently. Our approach tends to be a combined one so we find the right technology and then work with our IT partners to make it work for us.

The two key challenges we faced in the business analytics area have been data reliability and systems compatibility. We needed to ensure that the data from a variety of sources could be easily accessed and make sure that the data set at the base was really reliable. Together with our partners at BEA Systems, we worked through these.

Are you a marketer as well, in the sense, selling the latest technology solutions to the company and convincing them to invest? How hard or easy is it for you to do this?
Certainly, communication is an important part of my job. Like everyone in our organization, I need to be able to clearly explain the value of what we are bringing to the business table, and justify it on the basis of sound data and analysis. So, yes, in this sense, I am a marketer.

One interesting thing that we have done at P&G is using marketing skills to help explain the services we offer. We focus on communicating the benefits of what we are delivering.

How do you think has the role of the CIO evolved over the past many years?
In the past, the tendency was to see the CIOs role solely as a business support function. This perception has certainly changed. Today, the potential for IT to drive business value and growth is increasingly recognized. P&G is a good example. Today, our Global Business Service function is one of the four pillars of the organization. Its a good indicator that we have driven a transformation from the back office to the boardroom.

Shashwat DC
shashwatc@cybermedia.co.in

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