Enterprise Portfolio Management and Budgeting:
Global Pharma CIO Transforms IT Organization into Accountable, Low Risk Business Partner
Capitalizes on new enterprise IT portfolio investment and spend management process and governance framework
A global pharmaceutical company hired a new CEO to restructure the organization after their industry ranking and market share fell dramatically from first to seventh place in a relatively short period of time. Among the initial goals introduced by the CEO was a long-term, cost-cutting target of $4 billion within five years. This strategy included restructuring the global IT organization, whose yearly budget was approximately $1.5 billion. A new CIO was appointed and tasked with:
- Aligning the IT department to the new corporate strategy;
- Restructuring 10 separate divisions and consolidating to half the amount;
- Reducing spend across the board by 15%; and
- Instilling a new company culture focused on delegation and accountability.
To achieve these objectives, the new CIO had to overcome challenges in the following areas:
- Once a year planning occurred with little contingency.
- A lack of consistency across divisions in terms of technology platforms and process.
- Lack of clarity as to ownership, funding, and management responsibility of investments within IT divisions and across Business and IT units.
- Unclear investment alignment to corporate strategy – investments decisions were made using siloed division objectives only.