Case Study: Mergers & Acquisitions
CHALLENGE.
A fortune 100, $40B biotech company purchased a medium-sized medical device manufacturer in order to grow market share of competing products as well as grow their prodcut portfolio to offer patients a more holistic customer experience with end-to-end therapy solutions.
One of the biggest challenges that post immediate risks were in terms of culture and organizational change management. To ensure as fast an integration as possible, the decision was made to immediately begin consolidating ERP systems and harmonize processes between the two companies. The project was to be completed within one year.
Given the nature of the industry and the importance on delivering first time right quality to ensure business continuity, regulatory compliance, and most importantly, patient safety, it was imperative that only the most experienced and knowledgeable people be selected and that they formed a single cohesive and highly engaged team dedicated to delivering on very ambitious project objectives.
All-in-all, the scope of the project was to ensure successful migration of all processes and data consisting of approximately $4B in commercial assets, $369M open customer & I/C sales orders, $18M open purchase orders, $31M on-hand inventory, 3100 active materials, 1400 active customers, three production plants and six third party logistics distribution centers in a highly regulated environment.
SOLUTION.
The decision was made to retain JDE as the financial system of record and sole ERP system. To accomodate this, we built a cross functional team from both companies consisting of IT specialists, supply chain managers, operations experts and project managers. Working closely together, the team assessed current state of operations, processes and data for both companies and identified areas of overlap as well as new processes to be developed in the target JDE system.
Additionally, the team was tasked with enabling order fulfillment from a new network of 3PL providers which required careful planning and operational execution to ensure all regulatory and compliance was maintained throughout the process.
To ensure a smooth migration, the team developed and executed a detailed plan. The plan included the following steps:
Process and data mapping: The team mapped all processes for both companies, identifying areas of overlap and potential harmonization opportunities, and developed new processes where needed.
Systems development, validation and qualification: As is required by law, most of the new and modified processes were GxP relevant, and as such, were subject to government audit. To ensure compliance and patient safety, the team followed strict validation and qualification procedures before deployment to the production system.
3PL warehouse moves: The team planned to move the six 3PL warehouses twice, first to new locations and then to the final destination. Again, given that most of the data and processes were GxP relevant, extreme care was taken to ensure all quality system procedures were strictly followed.
Cut-over: The team developed and executed a highly detailed multi-phase cut-over plan, which included a detailed timeline of all activities and dependencies needed to take place to ensure a flawless transition. This included the migration of data, enablement of new processes, reintegration of customer and vendor systems and the moving 3PL warehouses while ensuring no disruption to customers, service or operations.
IMPACT.
The project was completed on time with very few issues post-production issues. Shortly after the completion and declaring success, the executive leadership teams declared the project to be the most successful project they had ever witnessed.
Overall, the project provided significant benefits as a result of streamlined operations, improved data management and visibility, enhanced collaboration, reduced costs and reduced regulatory compliance risk.
Improved data management: A single source of truth was enabled for all business data, improving the accuracy and reliability of data, and ultimately, significantly better decision-making.
Increased visibility: A unified view of all business operations was created to improve visibility into key performance indicators (KPIs) and other metrics critical to supply chain management and continuous improvement.
Enhanced collaboration: Organizational barriers were eliminated, communication improved and collaboration flourished between the two companies’ teams. This led directly to an overall improvement in productivity and operational efficiency.
Reduced costs: Costs resulting from redundant IT systems and processes as well as their support were eliminated.
Customer Service: Consolidated processes directly contributed to an enhanced customer experience as well as the ability to cross sell and provide customers with a holistic approach to patient care.