February 2010

A new, branded e-commerce site is the latest step in an IT-driven business model that is also elevating the role of IT professionals at Procter & Gamble.

By Karen J. Bannan

Century-old Procter & Gamble is embracing new business models to keep its venerable household brands top-of-mind with online consumers around the globe. And not surprisingly, IT is a critical engine driving the change.

Beginning this spring, consumers can buy their Pampers diapers, Tide detergent and Head & Shoulders shampoo on a P&G branded e-commerce site called eStore. P&G partnered with commerce services provider PFSweb Inc. of Dallas, which owns and operates the site. Pilot testing began this month to about 5,000 consumers, the company says. (See sidebar for more details).

The move is part of a broader adoption of Web 2.0 technologies and online marketing plans that are significant for several reasons, according to analysts. First, the b-to-b company, which provides its goods for sale through resellers such as stores and retailers, has historically been slow to adopt emerging technologies and alternative delivery channels; only $500 million of more than $76.7 billion in worldwide global corporate 2009 annual sales come from online retail channels such as Amazon.com and Drugstore.com. Second, marketing — not IT — has traditionally led corporate strategy decisions. Now, company CIOs and IT staff are working alongside their business peers to initiate ideas and turn them into tangible business practices.

Susan Doniz

“Technology is still an important part of what we do, but now [our job] is not so much about being a technology leader as about being a business transformation leader,” explains Susan Doniz, CIO and Associate Director of P&G Canada, based in Toronto. “The new role of the CIO and other IT leaders [at P&G] is about transforming the business” around new models and spreading the word about what new models are possible, she says.

Leading the Way

Doniz is a prime example of that new role. She leads P&G Canada’s end-to-end Information Technology and Shared Services operations — including business analytics, purchasing, project management, financial services, employee services and real estate — and reports directly to the CEO of P&G Canada.

Additionally, Doniz serves on a corporate Business Transformation Initiative team led by P&G’s global Chairman and CEO Bob McDonald, and the Global Business Services President and CIO Filippo Passerini. The initiative’s goal is to drive faster and better decision making across all functions and business units, which include 140,000 employees in more than 80 countries, the company says.

Being able to deliver new Web 2.0 services and online programs requires more than just technical knowledge; it takes a new kind of company, says Doniz, and that’s why P&G is transforming — most notably on the technical side of the business.

Doniz, along with the rest of the worldwide IT workforce of more than 7,000 full-time employees, is charged with building customer loyalty while maintaining and increasing sales revenue. “P&G is really making a concerted effort to digitize from end to end,” according to a company spokeswoman. As part of the change, the IT department was renamed Information and Decision Solutions (IDS). And the new title is more than a wording change; it comes with new responsibilities, says Doniz. “Everyone on staff is constantly thinking two steps ahead of the business and in some cases, bringing ideas to them first,” reports Doniz, who has been with P&G since 1996.

While consumers use P&G products daily, it is primarily a business-to-business company, dealing with resellers around the world. Therefore, P&G’s latest efforts are interesting and important because so many online marketing efforts originate in the b-to-c world, says Greg Belkin, a Retail Research Analyst with Boston-based Aberdeen Group. “It’s rare to see a b-to-b company make such efforts,” he says. In fact, the new eStore strategy is in line with best practices that many online retailers are struggling to achieve, he says. The challenge, of course, is to reassure P&G resellers — the thousands of companies that carry its brands online and in stores – that these efforts will support rather than undercut them. “P&G’s products are sold everywhere,” says Belkin, “so I don’t think many retailers are going to sit up and get nervous. If anything, these efforts should make them feel more comfortable working with the company.”

P&G will continue to operate its supplier portal, which offers immediate connections to key strategic partners. Additionally, it offers Connect & Develop, a Web site and a forum for prospective partners to share ideas, according to the company’s spokeswoman.

Doniz is also creating other solutions to aid the business. A new global business intelligence solution, called decision cockpits, was recently rolled out for more than 29,000 P&G employees. The dashboards aggregate all of the company’s data as well as outside metrics into a single interface so that brand mangers can reach out to customers and prospects. Until recently, Doniz says, no one had taken a cross-company view of the information IT collects. “Everybody looks at information from their silos — their product supply silo and their sales silo.” But with Enterprise 2.0, “the role of the CIO is to talk to the business about what new models are possible. We’ve taken a leadership role in putting [ideas] in front of the business,” Doniz says.

Hiring Change Leaders

The change in focus has also led to a change in hiring practices. Today, Doniz uses the military acronym VUCA (volatile, uncertain, complex and ambiguous) to describe the competencies she and the other IT members seek when hiring or promoting staffers. P&G continues to hire new talent as well as promoting from within, even in the tough economy. Unless it continues to hire new blood, the company isn’t putting future leaders on their paths, she says. “We need people who can lead through change,” she explains.

One of the key qualities she seeks is the ability to network with others. Candidates don’t need to know everything about every topic, she says, but they do have to know where to get their questions answered and their problems solved.

All of these changes have revamped the way the IDS department views itself. Today, the staff considers the department a business within P&G, says Doniz. As a result, she and the other IT executives consider profit and loss, market share, sales volume, and how to manage the brand and look at consumer benefits. “We think about all of those things now in an IT context, whereas in the past [we] weren’t thinking about those things at all.” Doniz says, P&G’s CEO McDonald, often asks CIO Passerini, “What business have you transformed today?” “That’s the equity that our CIO has built around IT.”

Moreover, in the past, the CIO was not represented on the corporate leadership team, or it may have reported indirectly — via the CFO or COO — to the top. But now IDS and Passerini are part of the executive team.

To keep her own skills on par with her direct reports, Doniz spends time on social networks, using Twitter, LinkedIn and Facebook. She also reads a lot and talks to consumers. “I ask people, Net Geners especially, ‘How are you using social media?’ If you don’t talk to people, you don’t know how they want [the] company to communicate with them,” she explains. In-person networking is equally important, and Doniz recently joined the board of directors of the CIO Association of Canada. It’s a role that “sharpens my skill set for my own board,” says Doniz.

In sum, “You don’t need to be a tech geek to be a strong IT leader,” Doniz explains. “You just need to be a business leader. You need to understand all these new ways we can process and look at information, and use that to our advantage to sell more products and affect more people’s lives.”

Karen J. Bannan is a New York-based writer and editor. She is also executive editor of Smart Enterprise magazine.

ASK THE EXPERT

Susan Doniz, CIO and Associate Director, Procter & Gamble, Canada

Susan Doniz leads P&G’s Canada’s Information Technology and Shared Services business operations. This includes: Business Analytics, Purchasing, Project Management, Master Data, Financial Services and Accounting, Employee Services, Business Information and Real Estate. She reports directly to the CEO of P&G Canada.  Doniz joined the company in 1986 and now serves on the Core Leadership Team of P&G’s Canadian business which has more than 2,000 employees.
Additionally, Doniz serves on the company’s Business Transformation Initiative to improve decision making across all functions and business units in over 80 countries.  Among her previous assignments with P&G, she has worked in Europe and Latin America.
Doniz speaks Spanish, English, French and Dutch and earned university degrees in Canada and in the Netherlands. She also studied at Harvard.  She is a frequent guest speaker at leadership and industry events and she serves on boards such as the CIO Association of Canada, Engineers without Borders and the Salvation Army National Board.