Overview
An international healthcare products and pharmaceuticals company was having problems with patent expiries and with the product development pipeline. These were adding to the pressures resulting from an increasingly competitive marketplace.
A Novo Altum director helped the company recognise the case for change, and defined a new global vision, strategy and design for its Finance function to boost its operating efficiency and reduce its cost base across its European operations.
By clustering disparate finance functions into regional shared service centres and configuring a world-class, tax-efficient supply chain, his strategy achieved the target of a 30% cost base reduction. It also successfully provided the mechanism to deliver sustainable change on a global level.
The Challenge
Struggling to bring new products to market quickly enough to counter the expiry of key patents, the company urgently needed to rationalise its cost base if it was to maintain its competitive edge in such a challenging marketplace.
Novo Altum’s consultant would need to design a solution that would re-configure the company’s support functions more efficiently across Europe, and provide a global framework for the supply chain and Finance Function operating models. He saw that better visibility of where the costs were in the business, a strong focus on streamlining operations and a strategy for re-investing cost savings into the business would be required.
The Solution
Working closely with the client on a strategic review of the business, our consultant developed a two-pronged plan of action.
He led the client through the process of defining its strategy for the EMEA Finance Function, and designed a target-operating model, which included establishing regional shared services and centres of excellence to reduce duplication and improve controls systems.
He also ensured that the Finance Function supported other critical business imperatives such as delivering a more tax efficient supply chain across Europe. To do this, he implemented a framework to streamline the way in which products got to market by creating regional distribution ‘hubs’ and satellites.
Results
In line with agreed targets, the project resulted in a 30% reduction in the company’s cost base.
By leading the client through a holistic process, from the initial business review, to strategic planning, and transitioning shared services centre effectively back to the client’s control, Novo Altum’s consultant had successfully implemented sustainable change across Europe which would provide a blueprint for the company’s global finance operations.
