The new chief executive of Rentokil Initial has thrown his weight behind an IT and operations-driven plan to quickly integrate the group’s City Link parcel delivery business.

In February, the diverse group said IT integration problems at City Link had held up the merger of the businesses.

The company has since said that “the business’s foundation for integration was not solid enough to cope with the degree of changes being put through the combined networks”. It emphasised that the move from a local to a centralised account management system had “unsettled customers who had formed strong relationships with former franchisees”.

But Alan Brown, new chief executive at Rentokil Initial, said the integration was making progress and would deliver service improvements.

“However, the return of City Link to its former levels of profitability is likely to take some time,” he added. “I believe this can be achieved by developing integrated information systems, by optimising our hub and depot network and by capitalising on the growth of the UK parcels market.”

In a full version of its 2007 results recently sent to investors, the company said that handheld consignment scanners had been rolled out as planned, and that managers were being trained on CRM software. But depot rationalisation will continue to be held back until systems are running.

It added: “The roll-out of hand-held, real-time proof of delivery equipment is resulting in faster, better and more transparent service information, and improved depot scanners are ensuring end-to-end visibility and control.

“A project is nearing completion to allow online updating of autogazetteers on customer sites which will help ensure that timed deliveries are not delayed by incorrect labelling and routing.”

City Link made a £16.9 million operating loss in the first quarter of 2008.

Related stories:

Mergers and acquisitions: what do CIOs need to know?