Daiichi Sankyo: Business Process Reengineering

Despite its enviable market position, Daiichi Sankyo potentially faced declining sales and profit due to rising product-development costs and expiring patents on several of its most lucrative drugs.

To maintain its momentum toward high performance, Daiichi Sankyo knew that it needed to develop a new profit structure and significantly reduce costs by streamlining its business processes and improving its operational efficiencies.

For help in determining how to best improve operating efficiencies and reduce costs, Daiichi Sankyo turned to Accenture.

There were several reasons for this decision. Accenture has deep knowledge of the pharmaceuticals industry; large-scale transformation capabilities and a proven record of helping global corporations improve efficiencies through reengineering business processes and streamlining information technology. In addition, Accenture had demonstrated its commitment to helping Daiichi Sankyo achieve high performance through a number of projects spanning several years.

Accenture quickly teamed with Sankyo's management to review the pharmaceutical giant's existing operations and establish a blueprint for change. In addition to restructuring its group companies/businesses and to reengineering a number of internal processes, Accenture proposed implementing SAP R/3—the industry standard in the Japanese pharmaceuticals industry—as the IT backbone.

Daiichi Sankyo agreed to these recommendations and asked Accenture to assist with the SAP implementation in supply chain management, finance and performance management, human resources and sales support functions. Accenture was responsible for restructuring and reengineering of all functions and for supporting the Project Management Office (PMO) of Daiichi Sankyo to manage whole initiatives including the SAP implementation. SAP Japan was responsible for developing the SAP solution for 6,000 users, and NEC is to run it.

With Accenture's help, Daiichi Sankyo achieved its goals of improving operating efficiencies and reducing costs. In fact, the reengineered processes and SAP solution generated savings of ¥20 billion (approximately US$180 million).

In the ever more competitive global pharmaceutical industry, managing and dedicating scarce resources to value-added activities is tantamount to success. By delivering new business processes and IT capabilities, Accenture helped Daiichi Sankyo achieve its ambitious cost-savings goals and drive high performance for years to come.