Kathleen Donahue Damodar Rao Gummadapu Aspiring High. Above and Beyond, Our Journey to “Be the Best” Business Process Intelligence

2 Introductions Name Company Areas of Interest

3 Company Profile Pfizer is headquartered in Manhattan, New York Global leader in;  Prescription Pharmaceuticals  Non-prescription Consumer Health Care Products  Pharmaceuticals for Animal Health Acquired Wyeth Pharmaceuticals in 2009

4 “One Team, One Goal” We share a common mission: apply science and our global resources to improve health and well-being at every stage of life. Working together for a healthier world

5 Era of Opportunity for Pharmaceutical Industry Changing regulatory environment New technologies Growth of manufacturing platforms Enlightened operating mindset Robust IT tools and systems Step Changes Are Not Enough…. A Paradigm Shift is Required

6 “Be the Best” Legacy Wyeth Vision for TO&PS Focus on product quality Leaders in cGMP & compliance 100% customer service Patient, stakeholder & shareholder value  Site Network & Plant Investments  Sustainable Compliance  Organizational Effectiveness  Integrated Standard Processes and Systems  Business Analytics

7 ERP Facilitates Business Strategy Goals  Improve operating efficiency  Facilitate execution of business strategy  Achieve targeted financial return Strategy  Standardize and integrate key business processes, data and controls globally  Improve timely access to consistent, reliable information to run and manage the business

8 ERP Value Drivers Enables One View of the Company  Single consistent source of enterprise data; facilitated by standard processes and master data across all business units, functions and divisions Provides Robust Analytics  Online financial analysis with multiple views of business results as needed  Cross-functional, drill down capabilities from management reporting through source transactions

9 SAP ERP Landscape SAP CRM (Customer Relationship Management) SAP SRM (Supplier Relationship Management) CRM dataSRM data SAP NW PI (Process Integration) SAP MII (Manufacturing Integration & Intelligence) To other Systems and Devises Integration BI data SAP NW BI (Business Intelligence) SAP ECC (ERP Central Component) ERP data ERP OPS SD (Sales & Distribution ) PP (Production Planning) QM (Quality Management) MM (Materials Management ) LE (Logistics Execution) Cross Application Components BASIS Components SAP SNC (Supply Network Collaboration) SAP SCM (Supply Chain Management) SAP APO (Advanced Planning & Optimization) SAP GTS (Global Trade Services) SAP EWM (Extended Warehouse Management) SCM data Currently Not in Use Planning Direct Procurement and Manufacturing Reporting and Analytics Quality Finance Sales Order Management and Logistics

10 Agility based on Business Drivers Continuous Improvement Knowledge Management Performance Monitoring Assess Process Maturity Form Process Focused Networks Institute Process Governance Functional Organization Align Processes and Metrics. Improve Processes Implement Process Architecture in Improvement Processes Process Performance Monitoring Continuous Improvement via OE Roadmap Process Focused Organization

11 Product Manager A Product Manager B Product Manager C Product Manager D Director of Product Operations Design Vice President Mfg Vice President Marketing Vice President Controller Procure- ment Manager President Functional Matrix Organization: Functions x Businesses

12 FUNCTIONS [Departments, Centers of Excellence) Process Management: A 3 rd Dimension in Management WORK PROCESSES [Source, Make, Fulfill, etc.] Business Units own customers and profitability Functions own the people and cost centers Process Owners own work designs and IT spending BUSINESSES [Business Unit, Region, focused on P&L’s & markets] FUNCTIONS [Departments, Centers of Excellence]

13 Agility based on Business Drivers Continuous Improvement Knowledge Management Performance Monitoring Assess Process Maturity Form Process Focused Networks Institute Process Governance Functional Organization Align Processes and Metrics. Improve Processes Implement Process Architecture in Improvement Processes Process Performance Monitoring Continuous Improvement via OE Process Metrics Process Focused Organization

14 Process Metrics enable Decision Excellence and Operational Excellence RUN THE BUSINESS Aligning processes with metrics to monitor and deliver reliable information, produce timely actionable results, and support Decision Excellence - enabling efficient and effective operations. IMPROVE THE BUSINESS Providing fact based information to support the operational, tactical and strategic reporting and analysis needs of OE initiatives - delivering continuous improvement of processes.

15 Metrics Measure Enterprise Excellence Business Operating Expense Reduction Additional Net Income Benefits ($M) Process Standardization Operational Excellence Reduced Materials Costs 2/3 of Benefit Source: AMR Research “Leveraging ERP for Ongoing Business Benefit”

16 Balance Scorecard Methodology Analyze the vision and Input Understand TO&PS Vision Launch Metrics Identify Thought Leaders Gather Input Determine Selection Criteria Propose Metrics Gain Consensus with Thought Leaders Metrics Development Re-assess Design Analyze & Plan Construct & Deploy n Understand the revised TO&PS Vision n Gather additional input from thought leaders n Proposed revised Metrics n Gain Consensus n Deploy revised Metrics n Collect data from Affiliates/OPUs n Calculate the Metrics n Provide the Metrics through single access mechanism along with the necessary details Report Metrics

17 Analytics Categories Used to understand value creation and to improve the business. High Level Metrics - translate strategy into measurable goals, includes:  Fist time quality  Product availability  End to end cycle time Operational Analytics - Leading and lagging indicators such as trending, process control charts and simulation, includes:  Inventory levels  Inventory targets Process Performance Monitoring – monitors use of standards vs non-standard processes across functional teams, includes:  Production Schedule  Stability  Adherance to supplier lead times Adoption measures – measure the use of standard sub processes in a functional team  Number of times reports are run  Time saved on each report  Use of emergency purchase orders

18 Improving Compliance Inspection Results

19 Increasing Efficiency $ 40%Improvement40%Improvement Net Sales / Employee

20 Reducing End-to-End Cycle Time Across Sites

21 The Power of Business Analytics… Leverage all data – and advanced statistical tools – to achieve Quality By Design Continuous process-performance monitoring Reduction in review time for product release by providing a single access point for information Leverage data for operational excellence  Six sigma analysis  Lean principles  End to end process optimization Provide tools for Decision Making Excellence at all levels of the organization … Is Limited Only By Your Imagination

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