1. Nishantha De Silva 2010/MBA/WE/MKT/09
R Shyamali Dias 2010/MBA/WE/MKT/15
A.W.B. Karalliyadda 2010/MBA/WE/MKT/12
N.N.I De Silva 2010/MBA/WE/MKT/14
Group Members
Baxter Healthcare
Corporation
Shared Services

2. Situation Audit
• Leading manufacturer and distributor of
healthcare products – Market Leader
• One of the Fortune 100 companies in the
world
• 62,000 employees
• 33 countries
• $ 8.1 billion revenue – 1990
• Operating income of $ 4.5% from sales
• 1985 – A Related Diversification strategy -
Merger with American hospital supply corp.

3. Shared Services in Albuquerque
• The Mission statement of Shared Service
division is “ To be the Leader in quality
service at the lower cost”
• The Objective is “ To Continuously improve
both service levels and cost efficiency by
eliminating manual processes”
• Quality Leadership Process (QLP)

4. Strengths and Weaknesses
Strengths
• Financially strong
• Market leader in the industry
• Product range
• Market coverage
Weaknesses
• No proper internal communication
• Rapid expansions without proper planning
• More product oriented than market oriented

5. Internal Customer Survey Analysis
Customer Response Albuquerque Perception
Performance Importance Assessment Importance Assessment
Understanding
Requirments 4.44 2.8 4.43 3.28
Responsiveness
Maintain customer focus 4.37 2.93 4.43 3.42
Credibility
Displays pride in work 4.25 3.39 4.21 3.59
Reliability
keeps customer informed 4.13 2.62 3.95 2.98
Tangibles
Thorough research 4.9 2.88 4.38 3.33
Features
Initiates creative solutions 3.97 2.37 4.05 3.25
Security
Inform changes 4.03 2.57 4.18 2.97
Overall Response 2.96 3.61

6. Customer
Assessment
Albuquerque
Assessment
Over all Satisfaction 2.96 3.61
Customer Billing 2.78 4
Credit and Collections 3.06 3.64
Hospital Supply Accounts Payable 3.11 4
Hospital Supply Audit Control 2.33 3.2
Cash Applications 3.36 4.36
Overall Satisfactions of Albuquerque Vs Satisfactions with
Specific functions

7. External analysis based on
assumptions
• Technology
• Government
• Economics
• Culture
• Demographics
Opportunities
• Opportunity to expand to international market
• Related diversification

8. Problem/Discussion Statement
Symptoms
• Internal customer complained about poor
service quality and poor internal
communication
• Issues in speed, responsiveness, accessibility
and timeliness
• Internal customers felt that there is a lack of
control

9. Problem
• Weak Strategic Planning
• Strategy mismatch with the Organizational culture
• No Change management
• Quick transmission to automatic systems from
manual (assumed) system.
• QLP was focused on cost reduction, did not concern
employee satisfaction

10. Alternatives Identifications
1. Shared service with Cluster approach
Identify the regions and main servicing offices which
can be clustered and have sub shared service center
for each cluster.
They can occupy themselves in the identified regions /
states whiles using the same shared services concept to
the cluster level as well, keeping line with their mission
and objectives. This will eliminate or reduce the
complaints in relation to communication and control

11. 2. Process Improvement with proactive
communications program - to create awareness and
motivation among internal customers
Continue Shared services with value additions
• Establish a Central monitoring unit to verify daily
operations & their cost & efficiency
• Research & development on existing systems &
procedures on continuous basis & implement
amendments where necessary
• Hold regular staff training sessions on shared
services
• Carry out QLP audits by external people

12. 3. Integrated strategy - Streamline Centralization focusing on
Synergy concept to achieve Customer value with proper Change
management and Internet Strategy (Cloud computing option)
• Streamline the centralization with the objective of identifying
synergy opportunities
• Appointing a change management agent or team for
Albuquerque as well as other main organizations, with focus on
customer.
• Internet strategy - linked into one network (Albuquerque
network) via interface each organization can have access to their
portfolio.
• By Cloud computing and/or alliance or joint venture with a IT service
provider.
• Target market - give the internal clients the lost control of knowing what is
happening and informing their clients on time and can build client
relationship by extending this facility to external clients for online enquiry
system etc.,

13. These are considered as alternatives
because :
• Relevant – changes to existing strategy hence cost is the minimum.
The purpose of implementing centralization concept is achieved (cost
saving, operational excellence, innovation and quality)
• Feasible – The company has the assets and capabilities as the staff
recruited are trained and knowledgeable and the operation is headed by
a CEO with experience and expertise hence good leadership is
available.
• Sustainable – Sustainable in the long-run. This would further gain
synergy concept and increase of customer satisfaction, thereby,
increasing sales and growth in the long run.

14. • The competitor strategies reasonably assumed to have focus on superior
customer service competing against Baxter as the market leader hence they
are looking at improving this aspect.
• Baxter can be the leader in this as well in line with their mission statement in
leadership in innovation and by this gain competitive advantage over the
others.
• Baxter history states that they used to service their clients and sales and
distribution levels, at headquarters and at regional offices, which built the
customer relationship with each company. This can be achieved and further
improved by the internet strategy.
• In the long-run the business strategies proposed would create customer value,
competitive advantage, innovation, superior customer services to internal and
external customers and by this increase sales, growth and profitability.
However, a proper feasibility study is proposed to see the implementation
effectiveness and fit/match with Organizational culture, assets and competencies.

15. Critical issues
• Merger - Cultural differences and approach between different
organizations
• System Perfectness – Expert system needed enhancements -
Reduced Confidence on new systems & procedures
• Mission / Objectives – of Baxter and Albuquerque are - not
aligned
• Fit between strategy and Organizational elements not
considered
• Same level of performance indicators to Internal and External
customers but their requirements differ
• Recruiting Skilled / knowledgeable staff

16. • No tool to measure customer expectation and
satisfaction – internal and external customers
• No mechanism for Complaint handling
• No ServQual framework to measure promised
against actuals and to identify gaps
• Strategy (shared services concept) mismatch with
the Culture
• Change management

17. Analysis
• Shared service with Cluster approach
• Process Improvement with proactive communications
program
• Integrated strategy

18. Strategy 1 –Synergy Concept with Internet Strategy (Cloud)
1) Cost High Low
2) Increase customer satisfaction High Low
3) Profit making ability High Low
Strategy 2 –Process Improvement
1) Cost High Low
2) Increase customer satisfaction High Low
3) Profit making ability
Strategy 3 – Central Monitoring unit
1) Cost High Low
2) Increase customer satisfaction High Low
3) Profit making ability High Low
Alternative 2 – Process improvements
Alternative 1 – Cluster Approach
Alternative 3– Synergy with Change
Management

19. Recommendations
• Define process boundaries
• Define common standards
• Define process policies
• Design core processes and procedures
• Ongoing communication with internal
customers and external customers
• Develop a collective culture

20. • The recommended strategic option is to do a BPR to the current
centralized operation and to the each specific unit with the objective of
achieving synergy . Therefore, in this regards ;
• What specific actions should be taken – The centralized team makes all
the strategic decisions and has a strong functional capabilities to
implement them. This will be done in form-wide perspective. And it can
make sure that synergy opportunities are detected and exploited.
• Main reason why this course of action will work – To succeed the central
team needs to have credible knowledge of the products and the markets,
the necessary resources, and the authority and stature to get things done.
This will work best when the scope if narrow and is under a
knowledgeable CEO who has a well earned respect throughout the
organization.

21. Implementation :
• Who should do it – A Change Agent is recommended to handle this change
management along with a business analyst to do the BPR. The top
management support is mandatory. Furthermore, the employees of all units (as
much as possible – identified key operational and influential employees)
should be actively involved n this process.
• What should be done – The centralized should play the role of a service
provider, consultant or facilitator to the internal clients,
• When should it be done – The strategy should be carefully planned and should
be feasible.
• Where should it be done – overall organization
• However, whatever the management style or strategy used it need to match
with the organizational heritage and culture otherwise it will be rejected.
• Tentative budget – keeping a adequate budget is important in order to
achieve success in this process.

22. Thank you
Forum for Questions