Internet driving big changes at companies

• Chips to make your shopping easier, faster

By Cliff Peale
Cincinnati Enquirer

Robert Dixon, right, vice president for information technology at Procter & Gamble, confers with Thomas Massung. P&G's internal Internet strategies are helping the company save millions by using the Net to handle consumer contacts and employee benefits. Gannett News Service

Shareholders in dot-com companies lost billions. But the same strategies that drove that craze have become established programs inside companies including Procter & Gamble Co.

The strategies are helping P&G cut millions of dollars in costs. They're also shrinking production cycles and improving communication among thousands of employees. All of this benefits corporate profits — and yes, stock prices.

"I don't see how a company of this scale can survive without the Internet being at the core," said Robert Dixon, vice president for information technology and leader of the "Leverage the Internet" program within P&G.

Leverage the Internet has focused on the way P&G deals with consumers, suppliers and customers, and employees.

• From Pampers.com to beinggirl.com, consumers are using P&G's Web sites more. P&G's corporate site, www.pg.com, hosted 1.87 million users in April.
• Suppliers in remote areas, who were faxing or mailing order slips to P&G, are tapping into an Internet portal that automates the process.
• Employees now access most of their benefit and job-related information over an internal Web site.

Creating an Internet-friendly culture takes years, said Christine Overby, a senior analyst with Forrester Research in Cambridge, Mass.

"This is about quick hits, small wins, and the systematic communication of those throughout the entire system," she said.

Within P&G, Dixon, 47, is the voice of the Internet focus. Last summer, he got the seal of approval from the chairman and chief executive, A.G. Lafley, becoming the newest member of P&G's Global Leadership Council, the three dozen top executives who report to Lafley. Lafley's increased focus on using the Internet — "value creation" in Procter-speak — gave Dixon the organizational muscle he needed to nudge acceptance among employees around the world.

Milan Turk, director of global customer business development, said success for P&G's Internet program is measured not by new technologies, but by sales and profits.

"Everybody has a computer on their desk, and everybody who leaves the building has a laptop in their briefcase, but the point isn't to focus on the technology," Turk said. "It's all tied to business results."

Working without a defined budget, Dixon has identified nine major goals, and is streamlining those to three, isolating those that can be leveraged throughout P&G's 102,000 employees in nearly 80 countries.

For example, P&G now conducts its focus groups over the Internet in the United States. Costs are 10 percent of what they once were, and the tests often are done in 24 hours, Chief Information Officer Steve David said.

The job, Dixon said, is far from done. Much of his work is nudging changes through P&G's sometimes rigid corporate culture. That skill took center stage when Dixon sought to implement electronic procurement.

The baby and family care unit, which makes Pampers, Bounty and Charmin, is saving up to $2 million a year globally on office supplies alone.

Chips to make your shopping easier, faster

CINCINNATI — You've just entered the supermarket. You swipe your credit card at a terminal and, voila, it prints out your normal weekly shopping list.

But the list also includes tomato sauce and ricotta cheese, which you added at home via your computer when you decided to make lasagna. When you've finished shopping, you skip the checkout line and pause only for your credit card receipt.

It's not fantasy, but within a few years of reality, say Procter & Gamble and other big companies working on a plan to put a computer tag or chip half the size of a dime on every item in every store.

The chips won't just speed and ease shopping for time-starved consumers. They will be the biggest boon to retailers and their suppliers since the bar code.

The tags are a powerful example of how a second technological revolution inside big companies is driving new uses of the Internet.

"I believe this is every bit as transformative as the Internet revolution we just went through," said Steve David, chief information officer at P&G.

This second revolution slices costs and squeezes production cycles for businesses.

An alliance including P&G, NCR Corp. in Dayton and Wal-Mart Stores is developing the Auto-ID technology.

The technology, conceived at Massachusetts Institute of Technology in Boston, is ready for placement on pallets and shipping cases.