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Transition Management:        A Model for Success           Barnaby Fountain, Master Black Belt           Director, Merck ...
Forward-Looking StatementThis presentation includes “forward-looking statements” within the meaning of the safe harbor pro...
Today’s MerckMerck is a global healthcare leader working tohelp the world be well.•   We provide innovative medicines, vac...
Key Company FactsTRADE NAME          The Company is known as Merck in the United States and Canada.                    Eve...
Merck’s Organizational Structure  Research        Supply &       Global Human      Consumer        Animal Laboratories   M...
Global Services at Merck                                       Chris Scalet                                          EVP  ...
Shared Business Services at Merck Generating Productivity                                                                 ...
Shared Services SuccessEconomies of scaleFlawless transaction processingMeeting service level agreementsExcellent customer...
Building Trust and CredibilityProject Results• Expanding to new markets• On-boarding new services• Building a regional ser...
Installation vs. RealizationInstallation: Putting something new in place• Installation occurs when projects are first intr...
What is Transition Management?       Service Engineering                     Organization Development          Alignment w...
End-to-End Transition Process                              Transition Management         Evaluate                      Tra...
Critical Skills                       Project Management                                        • Schedule                ...
Framework                                                                                                                 ...
Doing it well….•   Positioned for rapid growth•   Merger and acquisition leaders•   Benchmarked•   Workforce career path p...
Any Questions…?                                 Thank You!Barney Fountain, Master Black BeltDirector, Merck Sigma – Shared...
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Transition Management: A Model for Success

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Transcript of "Transition Management: A Model for Success"

  1. 1. Transition Management: A Model for Success Barnaby Fountain, Master Black Belt Director, Merck Sigma – Shared Business Services September 22, 2011V 1.4
  2. 2. Forward-Looking StatementThis presentation includes “forward-looking statements” within the meaning of the safe harbor provisions of theUnited States Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to,statements about the benefits of the merger between Merck and Schering-Plough, including future financial andoperating results, the combined company’s plans, objectives, expectations and intentions and other statements thatare not historical facts. Such statements are based upon the current beliefs and expectations of Merck’smanagement and are subject to significant risks and uncertainties. Actual results may differ from those set forth inthe forward-looking statements.The following factors, among others, could cause actual results to differ from those set forth in the forward-lookingstatements: the possibility that the expected synergies from the merger of Merck and Schering-Plough will not berealized, or will not be realized within the expected time period, the impact of pharmaceutical industry regulation andhealthcare legislation; the risk that the businesses will not be integrated successfully; disruption from the mergermaking it more difficult to maintain business and operational relationships; Merck’s ability to accurately predict futuremarket conditions; dependence on the effectiveness of Merck’s patents and other protections for innovativeproducts; the risk of new and changing regulation and health policies in the U.S. and internationally and theexposure to litigation and/or regulatory actions.Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of newinformation, future events or otherwise. Additional factors that could cause results to differ materially from thosedescribed in the forward-looking statements can be found in Merck’s 2010 Annual Report on Form 10-K and thecompany’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site(www.sec.gov).
  3. 3. Today’s MerckMerck is a global healthcare leader working tohelp the world be well.• We provide innovative medicines, vaccines, biologic therapies and consumer and animal health products to help improve health and well-being.• We work with customers in 140 countries to deliver broad-based healthcare solutions.• We demonstrate our commitment to increasing access to healthcare through far-reaching policies, programs and partnerships to help people around the world lead healthier lives.
  4. 4. Key Company FactsTRADE NAME The Company is known as Merck in the United States and Canada. Everywhere else, we are known as MSD.LEGAL ENTITY NAME Merck & Co., Inc. remains the name of the publicly traded company. It also is the formal legal entity name of our holding company, which has operating companies under it, including Merck Sharp & Dohme Corp., Schering Corp. and N.V. Organon, for example.EMPLOYEES Approximately 94,000 (as of 12/31/2010)HEADQUARTERS Whitehouse Station, New Jersey, U.S.A.BUSINESSES Pharmaceuticals, Vaccines, Biologics, Consumer Health Care and Animal Health2010 REVENUES $45.6 billion2010 R&D EXPENSE $10.9 billion
  5. 5. Merck’s Organizational Structure Research Supply & Global Human Consumer Animal Laboratories Manufacturing Health Care Health Human Resources Finance Legal Strategy Global Services Organized into strategic divisions and global support functions (GSFs) Centralized GSFs in 2006 to improve accountability and reduce cost structure Strategic division and GSF leaders are members of the Executive Committee Standardizing business processes, data and information systems globally Integrating Schering-Plough to enable OneMerck and deliver value capture 5
  6. 6. Global Services at Merck Chris Scalet EVP Global Services (GS) and CIO Shared Business Merck IT Facilities Security Services Sigma (SBS) Divisional IT Enterprise Portal Aviation Sigma People Contact Centers Application Facilities GS Supplier Products Services Hire to Retire Management Energy Property Technical Procure to Pay GS Learning Services Order to Cash Fleet GS Operational Record to Report Real Estate Communications Travel, Meetings and Media Master Data, Reporting and Analytics 6
  7. 7. Shared Business Services at Merck Generating Productivity • Raising the ENTERPRISE PORTAL & SUPPORT SERVICES Effectiveness of our Managers, Employees One.Merck.com Usability Help Desks and Client Groups GLOBAL REGIONAL • Creating CapacityHR SERVICES COMMERCIAL SERVICES • Optimizing our Value Order to Cash Procure to Pay Record to Report Chain, Cash Flow Hire to Retire Americas EMEA AP/J and Business AgilityPayroll Benefits • Proactively Managing MANAGED SERVICES Indirect Spend • Integrating Value Travel Card Meetings Media Contingent Workforce Capture DATA EXCELLENCE & ANALYTICS • Shaping our Shared Services Master Data Operations Reporting Analytics Culture • Driving Integration STRATEGY & SERVICE ARCHITECTURE • Sustaining Sigma Master Planning Change Management Transformation 7
  8. 8. Shared Services SuccessEconomies of scaleFlawless transaction processingMeeting service level agreementsExcellent customer satisfactionLabor arbitrageEnabling self-serviceEfficient standard processes - automatedContinuous improvement – lean thinkingCompliance with laws, regulations, and policy 8
  9. 9. Building Trust and CredibilityProject Results• Expanding to new markets• On-boarding new services• Building a regional service center• Implementing a global ERP system• Integrating mergers & acquisitions New Dublin Service Center Leading efficient and effective service transitions is a fundamental capability 9
  10. 10. Installation vs. RealizationInstallation: Putting something new in place• Installation occurs when projects are first introduced and deployed into a work settingRealization: Achieving the expected return on investment• Realization occurs when the fundamental purpose for the change is achieved 10
  11. 11. What is Transition Management? Service Engineering Organization Development Alignment with service Impact on Current Organization blueprints New Organizational Structure Logistics Supporting Book of Operations: Process Roles & Responsibilities Telecom & Technology Flows, Job Aids, Policies, etc. Staffing Strategy & Hiring FacilitiesTransition Planning & Security Support Accountability Training & Education Integration Assessment Plan Management Development Resources Delivery Successful Risk Management Transition Marketing & Assessment Communication Mitigation Audiences Monitoring Development of messages/ Business Continuity marketing Material Rollout Realization Sponsorship & Relationship Vendor Management Key Performance Metrics Service Level Agreements Management Partner Engagement Continuous Improvement Assessment Service Model Development Relationship Management Maintenance 11
  12. 12. End-to-End Transition Process Transition Management Evaluate Transition Stabilize Build Identify Assess Implement Handover & TransitionOpportunities Operations Change Sustain Plan cost & people, process, people, process, capability gap tools development tools transferLegacy SBS-aligned Cost and capability transformation Create, improve, or continue a service 12
  13. 13. Critical Skills Project Management • Schedule • Issues/actions • Risk management • Resource planning R L i e g f h t Service t ChangeOptimization Management• Compliance • Sponsor engagement• Service Levels • Intent alignment• Process Mapping • People impacts• Critical to Quality • Communications• Process metrics • Training• Failure mode & effects analysis 13
  14. 14. Framework Ops  Strategy Team Project Team Team Optimize Business Opportunity Portfolio Project Kickoff Discovery Design Implement Delivery &Initiation Analysis Mgmt Initiation Meeting Integrate What is High Level Portfolio Project Project Current State Future State Training Production MeasureAgreed to? Scoping Review Charter Enrollment Documents Doc Provisioning Stabilize Control SOPsTime Boxed? Complexity/ Resource  Scope Align on  Stakeholder Legacy Hypercare Continuous Resources Impact Scope Analysis Staffing Plan (Clean up) Plan Improvement Required Kickoff Plan & Charter Budget  IT  Risk  Hiring Controls Impact Identify Detailed Implications Mitigation Transition Discovery Plan Notifications Team Plan Audit Implications Hypercare Infrastructure Align Roles Plan & Communication Discovery Responsibilities Org Design Report Communication Project Plan Plans Training Plan Initiate Discover Implement Optimize 14
  15. 15. Doing it well….• Positioned for rapid growth• Merger and acquisition leaders• Benchmarked• Workforce career path progression• Great place to work• Retain top talent• Focus on end user productivity Driving Transformation 15
  16. 16. Any Questions…? Thank You!Barney Fountain, Master Black BeltDirector, Merck Sigma – Shared Business ServicesMerck & Co., Inc. 16
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