Ocado Group PLC (LSE:OCDO) has upped the ante on its B2B technology ambitions with the appointment of ex-Salesforce president and ex-BT boss Gavin Patterson to the board.
Patterson was BT’s chief executive between 2013 and 2019 before being replaced by Philip Jansen after the telecoms group’s shareholders called for a change in leadership.
Patterson faced numerous criticisms as head of BT for missing targets, overseeing a widening pension deficit and a poor share price performance.
But it’s his experience as president and chief revenue officer of US tech giant Salesforce that is likely to have attracted Ocado.
Although Ocado is perhaps best known for its retail joint venture business with M&S, its B2B robotics and automation services under the Technology Solutions umbrella are the real growth areas.
Commenting on his addition to the board, Patterson called Ocado “a true technology pioneer… It has developed and proven applications of AI and robotics that solve some of the most complex supply chain challenges in grocery and logistics. I look forward to working with the board and the leadership team at this exciting time”.
With the grocery offering continuing to look shaky amid a fallout with M&S, Technology Solutions is increasingly looking like Ocado’s killer app.
This evolution has caused some shareholders, including one leading fund manager, to pressure Ocado into chasing fairer valuations with a US listing.
There have even been calls to spin out the retail business to focus solely on Technology Solutions.
Nothing has been confirmed by Ocado but the addition of a US tech expert to the board sends a clear message that Technology Solutions is increasingly looking like the way forward for Ocado.
“We are also now deploying our unique technology into new sectors and opportunities for the first time,” said Ocado boss Tim Steiner. “At this important moment, Gavin's considerable experience at the helm of multinational B2B technology companies will be a valuable asset to our board and leadership team."
Technology Solutions is “central to the value of Ocado”, Deutsche Bank wrote today as it initiated coverage of the company.
Analysts said: “We are enthused by the opportunity Ocado’s solutions can provide to grocery partners given the continued shift of grocery to online, the significant and unmatched productivity gains from the group’s technology, and Ocado's ongoing innovation.”
Ocado shares were up 0.7% on Thursday.