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P&G puts packaging a click away

Procter & Gamble’s director of corporate purchases talks about how packaging design and procurement will become increasingly web-based and collaborative.

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On February 15 it was announced that DuPont and Procter & Gamble Co. had agreed to become investors in Packtion (Chicago, IL), an online solution provider for the $450 billion global packaging industry, by investing a combination of cash and certain intellectual property. Packaging World asked Tom Hayman, director of corporate purchases at Cincinnati-based P&G, to elaborate on how the relationship with Packtion would affect P&G’s packaging design and procurement process. Portions of the interview follow.

Q: How did P&G’s commitment to Packtion come about?

A: They approached us in the Spring of 2000. We worked with them on a couple of pilot projects that are still underway. We also evaluated other comparable offerings that we saw out there. But as we went through the evaluation process, it soon became clear that Packtion was the most capable collaborative packaging portal. We felt that an opportunity to combine with Packtion not only our own intellectual property but DuPont’s as well, was simply an unbeatable opportunity.

Q: How will P&G use Packtion?

A: We’ll use all three of their product offerings. The Knowledge Management Network [packaging-specific data and information covering industry publications, company profiles, regulatory databases, and Web sites] will help us make better, faster decisions. Product Rocket, Packtion’s collaboration software, is really exciting because it offers opportunities to do both package design and development collaboratively, as well as some commercial and supply chain collaboration. The Private Network component is appealing, too. Ideally it will become a place where suppliers catalog all of the packaging materials they offer and buyers catalog the things they buy. Ideally these catalogs will be in the same language and format, so you can quickly search from either the buy or supply side for what’s available out there.

Q: Can you provide an example of the intellectual property P&G might bring to the table?

A: A good example is the specification management system that we’ve spent five years and many millions of dollars developing internally to help us manage packaging specs globally. Packtion will now have exclusive rights to use it in the packaging domain to offer customers a world-class global specification management system that will not only simplify spec management for customers but will also link to the Private Network cataloging system that Packtion is building. It will give companies a packaging specification management system that is in the same language as Packtion’s catalogs. That will make shopping in the catalogs much easier and faster for Packtion’s customers. In fact, we’re optimistic that the spec management system that emerges from all of this will become an industry standard.

Q: Is P&G giving away too much, potentially to its own competitors, by sharing things like a global spec management system that it took five years to develop?

A: This is the role we’ve chosen to play to help establish industry standards where it’s beneficial to everybody up and down the supply chain. If we believe we have something that will help facilitate B2B e-commerce, then we think it’s the right thing to share it. We help ourselves in the process.

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