Step 1
● Understand and outline the strategic context for the support function optimization exercise-
- Optimizing costs to balance growth whilst maintaining/ increasing productivity
- Potential Drivers, e.g.
● Resources & skill sets required now and over a period of time to accommodate planned growth and expansion in product portfolio
● Speak with business heads and key customers of the support functions to understand performance of and feedback for various support functions
● Understand role and importance of various support functions
● Understand size of various support functions and key cost heads
● Also review the business feedback for the various support functions
Step 2
● For each support function, understand all key roles & responsibilities
- Job functions and descriptions for different positions
- Staffing levels
- Job families*
- Skill sets and capabilities required
- People performance metrics
● Having understood individual roles, analyze processes and process ownership
- Operating procedures
- Work-flow
- Activities/ responsibilities of each entity for that work-flow
- If required, document time taken for each activity
- Identify and if required, document a list of all activities within a function
● Based on the process diagram and analysis of activities and activity ownership, assess opportunities for optimization
● Eliminate activities
- This would focus on identifying activities that are
● Non-value-added activities
● Redundant or repetitive activities
- Such activities will be eliminated from the process
- This may result in lower utilization of one or more personnel in a function that will allow combining roles for optimizing manpower usage
- Merge similar roles. Ascertain technical knowledge and skill sets after grouping together similar roles in order to avoid duplication of effort
● Delegate activities to lower levels
- Delegating activities to lower designations optimizing costs through using a lower cost employee to conduct the same activity
● Reassign job descriptions to reflect the change in responsibilities, if any
- Job title & reporting structure
- Purpose/ objectives
- Primary and secondary responsibilities
- Working area
- Re-define job descriptions
● Automate activities
- Identify activities (where standardization/ templatization is possible) that could be automated through IT or automation tools
● Evaluate the benefit of outsourcing any activities or process
- Identify activities or processes that could be executed using an external service provider
- Conduct cost-benefit analysis of outsourcing
● Benchmark internal costs of personnel against that of outsourcing
● Assess potential improvement in quality and speed of execution
● Assess ease of implementation in terms of transfer of responsibilities
● Evaluate risks associated in terms of initial hand-off as well as ongoing execution
● Prepare a diagnostic report outlining key issues, e.g.
- Issues with existing processes:
● Redundant processes
● Performance metrics misaligned
● Distinct formats for each department. Lack of standardization
● Issues with existing organization
- Lack of segmentation between primary & secondary responsibilities
- Structural relationship not defined
- Job experience and qualifications common across roles
● Gain consensus from ABC team on issues highlighted in Diagnostic Report
● Interview relevant personnel from comparable leading players in Pharma and Non-pharma space (e.g. FMCG) to derive learnings from their experience:
- Org structure
- Team size
- Span of control
- Job profiles
Step 3
● Redesign Processes
● Define Key Performance Indicators (KPIs) for the processes
● Assign KPIs to functions
● Redesign organization structure
- Positions
- Span of control at various positions
- Number of personnel required for each position
Step 4
● We will quantify the potential cost savings, where possible. Summarize cost saving opportunities across all the areas
● Prioritize initiatives based on –
- Potential cost savings
- Ease of implementation
● Categorize initiatives into various buckets from an implementation stand-point
- Quick wins/ Immediate initiatives
- Mid-to-Long term initiatives
● Develop a detailed implementation plan
- Outline activities, priorities and
- Define ownership/ responsibility
- Define start and end dates