The Nature of IT
IS6800 Professional MBA Course
Rick Morgan
David Ouellette
Paul Hippenmeyer 8 October 2004
Pfizer Company Background
• World’s largest pharmaceutical
company
– $45.2 Billion in Revenue (2003)
– Headquarters New York, NY
• 122,000 employees
• $236 Billion market cap
Selected Financials: 2003
Source: 2003 Financial Report
REVENUES: $45.2 Billion
R&D Budget: $7.1 Billion
Net Income: $3.9 Billion
% of revenues 8.7%
Revenue by Business Segment
2003 Revenues by Division
Pharmaceuticals
Consumer Health
Animal Health
87.7%
3.5%6.7%
Pharmaceutical Division• Pfizer Global Research and
Development (PGRD)– Drug Discovery thru Clinical Trials
• Pfizer Global Manufacturing
• Pfizer Global Pharmaceuticals– Marketing, Strategic Planning,
Sales
Pfizer Global Research & Development (PGRD)
• 10 Research sites– Amboise, France– Sandwich, UK– Nagoya and Tokyo, Japan– USA … Cambridge, Groton/New London, La
Jolla, Ann Arbor, Kalamazoo, and St. Louis
Discovery Research Informatics (DRI)
PGRD IT Organization
Informatics (PGRDi)Corporate
Information Technology (CIT)
Clinical Regulatory Informatics (CRI)
Development Sciences
Informatics (DSI)
Enterprise Informatics (EI)
Applications Network and Infrastructure
Informatics (PGRDi)Corporate
Information Technology (CIT)
PGRD IT Organization
PGRD Leadership
Team
Corporate Leadership
TeamHead of Finance CFO
PGRD IT Budget Issues
• Software licenses are huge drain on budget
• Too many applications to support.
• All capital request are funneled to Groton (PGRD headquarters)– No local control
PGRD Governance Model
Discovery Leads
Safety Science Leads
Pharm. Sci. Leads
PDM Leads
PGRDi Board of Directors
(oversight)
Discovery Unit IT Governance Board
Safety Sciences Unit IT Governance Board
Pharmaceutical Sciences Unit IT Governance Board
PDM Unit IT Governance Board
Business Unit GovernanceDecision-making authority within
business unit
Vendor Sourcing
• Most PGRD application development in-house– Occasionally one vendor chosen
• Temporary staff hired on an “as needed” basis
Evaluating Cyclone Commerce E2BM
(Enterprise eBusiness Management)
• Safety reporting of Severe Adverse Events (SAEs)– Speed
• Clinical Trial and Regulatory submissions– Compliance with various regulatory agencies and
ICH guideline
Summary PGRD IT
• Separate reporting lines for applications vs. network and architecture
• Little out-sourcing of PGRD application development
• Software licensing huge drain on budget• Shear number of applications limits
resources• Moving toward centralized type
governance
IT Organizational Mapping
Pfizer IT organization resembles a “Platform Model”
• “Primarily aims to insure that IT function provides assets, services and resources for business innovation across the enterprise” (Agarwal and Sambamurthy, MIS Quarterly Executive 1 (1), p. 9, (2002)
• Corporate IT seen as enterprise-wide resource for architecture and networks
• Business units own IT innovation with unique application needs.
Pfizer IT Governance Mapping
• Within PRGDi the governance appears to be transitioning from a “Duopoly Model” to a “Federal Model” of governance (Weill, MIS Quarterly Executive, 3(1), (2004).
• Currently independent Business Units
• All business units represented
• Enterprise-wide network and architecture input
• Ultimately C-level executive committee involvement
Sources
• Email Correspondence and phone interview (10/4/2004) with Jeffrey Gaw, Director, Scientific Informatics, Pfizer Global Research and Development
• Pfizer 2003 Financial Report• Presentation by Pfizer and Cyclone Commerce on
Electronic Submissions and Safety Tracking (11/2003)• James Champy, “Re-Examining the Infrastructure”,
Optimize Magazine, September, 2003.
“The ultimate discussion is about value to the business. If we understand true life-cycle costs and benefits, we can evaluate any decision on its economic value to the business. That being said, not all potential investments can be made on an ROI basis. Some have to be made for risk-mitigation or regulatory reasons. Others are option-creating investments that are experimental in nature. By far, however, the vast majority of decisions by an infrastructure manager or CIO will be made on the basis of return. Understanding costs and benefits makes that possible.”
-Chuck Williams. CTO, Pfizer
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