Rising costs mean that biopharma companies are rationalising operations. Bob Mauger and Dennis Young-Cannon, ABB Ltd, explain how such changes can be made with the minimum of disruption to IT systems.

As cost pressures increase, biopharma continues to rationalise operations through divestment, acquisition, site closure, offshoring, shared services and lean projects. All of these strategies have an impact on business IT systems, from global ERP to local solutions. It is essential that these changes are implemented with minimal disruption while continuing to meet the requirements of the regulatory authorities for GxP and Sarbanes-Oxley.

The Standish Chaos Reports have stated that project success rates have increased to 34% and then dropped back to 29%. There are three possible project profiles (Figure 1). The first is the ideal starting point with a controlled increase and then decrease in resources. The second shows a missed go-live where resources have to be retained, and paid for, for longer. The third shows a project not in control but working to a fixed deadline, leaving problems to be solved after go-live at great cost. How can a company make sure its project follows the first profile and is not one of the 66% that fail?

Partnering

End-user companies are experts at executing operations and R&D. Most do not have the capability and culture to execute large IT projects effectively since they do not occur often enough to maintain a large team. Some end users look to fill the gap with a single implementation partner. This results in key knowledge gaps and there is an inevitable conflict when the partner wants to use the solution from their last implementation.

A more successful approach is to use the Migration Partner model (Figure 2). A migration management partner helps the end user deal with potentially ill-defined areas including:

  • validation and compliance
  • risk management
  • overall programme management
  • culture and organisation change.

To make this three-way partnership work, the key is to leverage organisation change, compliance and suppliers not to be a cost and burden, but to maximise the chance of ‘right first time’ on-time delivery.

Risk management

Effective risk management must be applied to all aspects of the project including project management, requirements definition and delivery, compliance and, especially, people. The main risk to all IT projects is missing and misunderstood requirements. Requirements come from two main sources: users and compliance (primarily GxP and Sarbanes-Oxley).

Effective processes are needed: firstly, to agree these requirements; and, secondly, to include all these requirements into the project planning at an early stage. The next step in reducing risk is to focus design, documentation and testing effort on
areas of greatest compliance or business risk.

With the launch of GAMP 5, there is confirmation that risk-based approaches for compliance can be used. Application of these principles straight from project initiation using a structured hierarchal methodology gives maximum benefit to reduce cost and risk.

The next area of risk management is the readiness of the business to adopt the new system. This means an organisation, people, business processes and systems are all stress-tested and ready for operational use. A well-planned and implemented Business Readiness approach will deliver this right first time. This ensures business continuity at the delivery end of the project, enabling the business to maximise RoI.

Particular attention must be given to changes of organisation caused by divestment or sharing of services (for example, HR and finance). There is often a reduction in numbers along with changes in processes, which makes it harder to obtain commit-ment from the remaining staff. Investment in maintaining motivation levels is even more important in ensuring a successful go-live.

Multiple implementations

Many companies are implementing a centrally developed template, which is then rolled out and implemented at the local sites. This provides two areas of activity: firstly, within the central template; and secondly, adoption of the global template to the local site often involving multiple software interfaces. The template must be flexible enough to meet the needs of multiple organisations.

Equally, the project management must be strong enough to control enhancements that require development, extended testing and ongoing support. Where an enhancement is not cost-effective, the project team must work with local management to help them change their processes to match the new system. Getting the balance of flexibility, governance and cost to the business is paramount for success. The following elements are also critical to success both within and between implementations:

  • continuity by selecting appropriate implementation partners and key in-house staff
  • continuous improvement processes that are built into the culture.

Offshoring

Another common approach to cost reduction is off-shoring, particularly to India and Eastern Europe. The first step is clearly to find a partner (or partners) with both technical capability and experience of working in regulated industries. However, even when such partners have been found, it is essential not to underestimate the time involved in that partner adopting regulatory compliance and the end user’s best practice in full. Staff turnover is a particular problem in growing economies, so the partner’s strategies for dealing with this need to be considered before making a final decision.

Many end users spend time explaining to partnering staff how to implement solutions at a low level, but fail to explain the overall business processes and the drivers for them. Without this, corners can be cut, especially as personnel change, resulting in both rework and compliance problems.

Benefits vs risks

The potential cost and efficiency benefits from consolidation are huge, but the risks can be just as large. Even a day without key business systems in place can cost a fortune. The main keys to success:

  • Systems and technology are the easy part – it’s the people elements
  • that determine success or failure.
  • Involvement of the users is essential from the start to ensure a working system and avoid any lack of ownership. Business Readiness is essential to ensure a smooth transition.
  • Appropriate (onshore and offshore) partners to cover technology, compliance and risk management realistic plans should be implemented for the sharing of processes, documents and knowledge.
  • Be aware of, and manage, the risks because the more time spent at the definition and development stages will save time and money at the latter stages.

Getting these things right reduces operational cost and flexibility for future development. Some might feel that success or failure in large IT projects depends on luck – but luck has nothing to do with it.