When economy, world over, was down last season, it was pharma and information technology (IT) industries that performed well at stock exchanges. The reason: they were keeping the lifelines of stakeholders intact.
Both industries were in transition in their own way. IT has become integral part of all businesses enabling bottom-line visibility with the power of automated information systems.
On the other hand, pharma industry bubbled with ever increasing demand and innovative healthcare products. Demand created many interesting repercussions that lead to two major directions - one in regulatory angle and the other in patents angle.
Pharma industry understood the importance of IT implementations, but were jittery with historic experiences. They always felt buying any pending equipment is a better proposition than investing into IT solution, even though, IT has promising value proposition in terms of business visibility, traceability and automated documentation.
An overall integration of software systems can bring amazing changes in pharma industry. Employees would get more quality time to perform their daily job. Middle managers can effortlessly handle continuous compliance. Top management would be empowered with better decision support to gear up for global competitiveness.
Various components that cover the value chain of pharma industry are ERP (Enterprise wide Resource Planning), SCM (Supply Chain Management), DCM (Demand Chain Management), CRM (Customer Relation Management), VRM (Vendor Relation Management), TRM (Transporter Relation Management), BPM (Business Process Management), BI (Business Intelligence), DMS (Document Management System).
The host of links/components of this value chain can be classified into three basic management concepts - ERP, SCM and CRM.
ERP: This concept's major focus is to plan all faculties of resources and run the business in accordance with above plan for optimized results. This invariably calls for integration of distributed business objects. ERP encompasses: -
Financials Management General Ledger, Accounts Payable, Fixed Assets, Cost Accounting, Cash Management, Budgeting, Accounts Receivable, Financial Reporting, Project Accounting, Product Technology
Human Resources Management Personnel Management, Benefits, Payroll, Employee Self-Service, Data Warehousing, Health and Safety, Product Technology
Materials Management Purchasing Management. Inventory Management. Quality Management.
Process Manufacturing Management Formulas/Recipes, Process Model (Formulas + Routings), Process Batch Control and Reporting, Conformance Reporting, Process Manufacturing Costing, Material Management, Product Costing, Shop Floor Control, Production Planning, Product Technology Quality SOPs, Manuals, Assurance Guidelines, Test Protocols, Analytical Reporting, Product Life Cycle Management.
Sales Management On-line Requirements (Sales Management), Reporting and Interfacing Requirements (Sales Management), Available-to-Promise (ATP), Pricing and Discounting, Customer Service and Returned Goods Handling, Customer Relationship Management (CRM) and E-Commerce Requirements, Product Technology
One can achieve optimized workflow, business control, visibility and trapping of value leakages through ERP implementations.
Just like the products that they produce, discrete and processing manufacturing software have different focal points and solve different problems. Just as you would not put the proverbial square peg in the round hole, don't expect to be successful using software geared toward discrete, or even a hybrid, to work smoothly in the process manufacturing setting. Even process manufacturing software, purported by salespeople to talk and chew gum at the same time, needs to be investigated. Critical aspects such as formulation, routing, ingredients, unit of measures, and pricing must be evaluated relative your business.
SCM: One side of outside-entity to ERP is SCM. SCM encompasses supplier, manufacturer, logistics, transportation, and customer business processes. Following would form part of SCM in detail:
Supply Chain Management Demand Management, Supply Chain Optimization, Warehouse Management System (WMS), Production and Supply Planning, Service Parts Planning, Transportation Management System (TMS), International Trade Logistics (ITL), Order Management, Supply Chain Event Management, Supplier Relationship Management (SRM), Product Technology
CRM: The other side of outside-entity to ERP is CRM. Even though SCM covers customer business process, it stands significantly distinct due to its importance in the whole process.
The perishable nature of pharma industry's materials and products is highly demanding such technology's integration. Coming 10 years is going to see a sea change in pharma industry, fully utilizing the potential of information technology. These two industries have to go hand in hand for innovative contributions to each other. u
(The author is senior program manager, Lera Technologies Pvt Ltd., Secundrabad. He is an IT consultant for pharma manufacturing and distribution companies.)