- Consumer Packaged Goods (CPG) companies are far behind other industries when it comes to the strategic use of technology, according to a new report from The Boston Consulting Group and the Grocery Manufacturers Association.
- The report found that 41% of CPG companies surveyed were "suboptimal operators, with high IT operating expenses and low levels of innovation.”
- CPG companies vary widely in how much they spend on IT and “have vastly different patterns and strategic choices” when it comes to IT, according to the report.
CPG companies must re-evaluate their IT strategies and priorities in order to keep pace with the rest of the tech-driven world, according to the report.
“We were surprised by how few IT innovation practices are being used by CPG companies,” said Ashwin Bhave, a BCG partner and coauthor of the report. “There are a number of low-cost, no-regret moves that can be made by CPG CIOs to stay ahead of the curve and create enormous value for the business.”
The report suggests CIOs review IT costs and reduce spending, collaborating with executive management to begin sensibly innovating. It also recommends CPG CIOs consider funding a variety of technology-enabled business capabilities and embedding technology solutions across the entire business.
“The challenges for CIOs trying to manage IT costs while driving innovation are intensifying,” said Jim Flannery, senior executive vice president of Operations and Industry Collaboration at GMA. “The CIO has the best vantage point from which to evaluate broad corporate needs in light of industry disruption and formulate a future-focused technology strategy.”