THANK YOU FOR SUBSCRIBING
Three steps to Succeed with Digital Transformation in Pharma
Philippe Caby, CIO, Centrient Pharmaceuticals
Even if all budgets will be constrained in the post Covid economy, expectations on digital transformation will continue to grow because pharma companies need now, more than ever before the sustainable competitive advantages it can deliver. Although the evolution of technology enablers has never been so fast, a lot of digital transformation will still be failing to deliver these expected benefits. Here are a couple of steps to maximize the chances of success of digital transformation in pharma:
Step number one addresses the “WHY”: defining the digital transformation purpose. Depending on your company, it can go from improved customer experience, compliant manufacturing, operational excellence, accelerated product development, and others.
Since the beginning of my career, twenty years ago, the technologies available have grown exponentially. So, it has become more and more important to structure the choice of the technologies that have the highest potential to enable our business goals. Indeed, technology is not an aim per se in the pharma industry, and this step will be a key to focus investments where it can add maximum value to your company.
Technology investments have to be agreed at the highest level with the executive committee (incl. the CEO) to make sure your digital transformation is aligned to the overall enterprise strategy. This is also a way to ensure the appropriate level of change management and sponsorship from the line management to effectively land new solutions in the operations. It is incredibly hard to agree on a way to measure success of technology initiatives when you create silos between functions. Off course tracking per function is good for the cost part of the equation, but the value part is much easier to measure at enterprise level. Doing so will also generate enterprise thinking and collaboration to reach a shared goal.
Aligning on the purpose also requires IT to partner with each function of the company showing deep understanding of their business. Ideally, each business leadership team should include an IT representative to develop this partnership. These profiles can come from a technology, consulting or business background, but need to use those three competencies to succeed.
Once the digital transformation purpose is defined and you’ve agreed on business measures of success with the sponsors, it will serve as an input to choose which initiatives will be launched.
Once the digital transformation purpose is defined and you’ve agreed on business measures of success with the sponsors, it will serve as an input to choose which initiatives will be launched
As technology leaders, we need to choose the right profiles, right technologies, and the right external partners to implement them. The number of technologies needs to be aligned to your organization capacity. Start small with external partners and fail fast or decide to scale up based on the outcome. Sustainable digital transformation programs should be funded by the value they deliver in the business rather than by risky cost cutting or increased technical debt on core IT applications.
Multi-purpose technologies that can enable several initiatives should come on top of your list. Adjust your risk appetite to the size of the opportunity, with no compromise on compliance.
This leads to the last step which is about the speed of your digital transformation. Looking at technology across industries, I see a pattern in the development of new technologies where overinvestment is often followed by failures before disruption leads to new market dynamics. I believe that digital transformation is no exception to that. The burst of the “dot coms” bubble happened 20 years ago, and the most successful companies in the world are now on internet.
The third step is then to carefully manage the timing of your digital transformation. It needs to be fast enough to accelerate your business but also adjusted to the pace of adoption in your company. Agile methodology with its focus on value flow and quality is of great help to get this right. This is not only valid for internal teams working on your digital initiatives, but also for your partnership with external vendors. The procurement function needs to be brought along in this journey. Agility needs to be built in our contracts allowing to share rewards, but also risks across companies. Three years SaaS contracts without possibility to exit when results don’t follow are over. Prices need to be based on usage.
In summary, successful digitalization should:
1. Serve a transformation purpose aligned to your company strategy and agreed with the Executive Committee.
2. Focus their technology choices and be executed by a multidisciplinary team including representatives of the users.
3. Apply Agile principles to adjust its timing with the investment capacity of the company, maturity of the technology market, user adoption and business outcome delivered.