When everyone is touting the value of partnerships, how do top CIOs distinguish a true strategic partnership from the many service provider, supplier and competitor arrangements?
We recently explored that question within the Society for Information Management’s Advanced Practices Council (APC) by focusing on two exemplary CIOs from Procter & Gamble and Kaiser Permanente.
Filippo Passerini is P&G’s CIO and group president of global business services, which provides shared services in finance, accounting, employee services, customer logistics, purchasing and IT. To Passerini, a strategic partnership is one in which both parties develop together and work to “grow the pie together.”
With its significant market position—selling some 300 brands in 180 countries—P&G can help its strategic partners increase their sales by providing testimonials for their products or services. The company has created strategic partnerships with several firms, among them Accenture, BT, Cisco, IBM, Microsoft, Nielsen and Xerox.
Passerini says that what distinguishes his strategic partners from his other vendors is their ability to help the consumer products giant strengthen its capabilities in three strategic areas: visualization, digitization and simulation. In simulation work, for example, physical product mock-ups can be replaced with virtual-reality applications, allowing marketers to virtually place products on the shelf next to those of competitors. This lets them evaluate packaging options more quickly and frequently, changing cycle time from weeks to hours.
Passerini’s division has delivered more than $900 million in cost savings since 2003 by improving quality, increasing scale through standardization, virtualizing brand design and development, and accelerating P&G’s completion of integrations and divestitures. “We can’t run faster, but we can change the way we run,” he says. “The longer we take to do something, the more difficult it becomes.”
Phil Fasano is CIO and executive VP of Kaiser Permanente (KP), the United States’s largest integrated health-delivery system, with 8.8 million members in 42 states. KP uses evidence-based medicine and industry-leading technology to provide prevention and affordable healthcare. To achieve the CEO’s mandate of leveraging IT to change the healthcare field, KP is expanding its use of electronic medical records (EMR) in an effort to reduce medical costs, make healthcare more efficient and improve quality of care.
Capitalizing on strategic partnerships help with that mission. Last year, KP launched a strategic partnership with the Department of Veterans Affairs to pilot standard EMRs. Last April, the healthcare provider joined four other health systems in the Care Connectivity Consortium, an interoperability group that promotes the use of standards-based health information technology to share data about patients electronically.
Both these CIOs act as business strategists by advancing the missions of their companies through high-level partnerships. In our APC member discussions lately, we’ve seen a distinct shift from CIOs striving to treat vendors as partners to CIOs seeking out suppliers that have the potential to become true partners. The contributions of the IT organization are becoming less about being expense or support centers and more about playing a key role in business investments.
Regardless of your industry or profit status, carefully selecting strategic partners can and should contribute significantly to your organization’s success.
Madeline Weiss is director of the Society for Information Management’s Advanced Practices Council (APC). June Drewry is former CIO of Chubb and a contributing adviser to the APC.