Service management frameworks can help clinical development organizations improve customer relationships, increase productivity and reduce costs.

1. • Cognizant 20-20 Insights
Leveraging Service Management to
Improve Clinical Development Operations
Executive Summary which increases complexity even further. Most
pharma R&D units are not set up in a way to take
The challenges within the R&D function of phar-
full advantage of these new ways of operating
maceutical companies are well understood. The
and thus struggle to find one-off approaches and
total cost for developing a new drug exceeds $1
solutions to the challenges they face.
billion due to the stringent requirements for large
clinical trials. At the same time, the pipeline for There is general agreement that the pharma R&D
new “blockbusters” (defined as drugs with market model has to be completely reinvented to suc-
potential of more than $1 billion in annual sales) cessfully address these challenges, adjust to the
targeting the general population has pretty much industry’s new realities and continue to produce
dried up, and pharmaceutical companies are new products efficiently and cost-effectively.
increasingly developing drugs that address the To improve R&D “yield” in generating high-
needs of specific smaller populations, a trend value, patient-centered and regulatory-approved
called personalized medicine. treatments, R&D organizations must find a way to
more quickly and effectively move from data to
The impact on R&D departments has been
decisions by focusing on activities such as:
staggering: Not only do they have to find ways to
do more with less, but at the same time, they also
have to become much more flexible, conducting
• Adopting predictive capabilities through
adaptive trials, signal detection or predictive
research on larger numbers of specialty clinical trial planning.
compounds. They also have to operate in a much
more connected environment, wherein they col- • Providing data and insights at the point
laborate with other companies, usually smaller of need through R&D mobility solutions,
biotech firms, university research centers, etc., adaptive monitoring or portals.
to discover and develop these compounds. • Bringing market insights to R&D more
consistently through market-aligned R&D and
While in the past clinical development was clinical trial feasibility.
primarily performed in-house, leading pharma
companies now rely on a host of external vendors, In sum, the pressure on CROs to deliver break-
such as clinical research organizations (CROs), though molecules has never been greater. As a
global services companies and other develop- result, they must become much more efficient;
ment partners. The decision to source particular open; standardized; innovative; continuously
activities is usually made on a trial-by-trial basis, improving; and flexible and adaptive.
cognizant 20-20 insights | october 2011

2. With these objectives in mind, CROs have been The service provider can be internal — typically
asking difficult questions, such as: another group within the same company —
or external to the company. With an internal
• How will I be able to effectively serve the provider, the company must decide whether the
different therapeutic units that rely on my customer will pay for the services, typically in
services? the form of a cost chargeback. In the case of an
• What activities should I keep in-house vs. external provider, the customer will, of course,
outsource? On the basis of what criteria will I pay for the services provided. Providing services
make these decisions? through a service management model requires
the establishment of service agreements, which
• Do I have to continue investing in new technol-
are contracts stipulating to a great level of detail
ogies, or is it more cost-effective to leverage
the expectations from both the customer and
external providers, for example, through cloud
service provider of the other party.
computing?
• What operating model will I put in place for The use of service management originated in
the activities I keep in-house to achieve my the information technology (IT) space, with the
objectives? objective of enabling better strategic alignment
between the business and IT departments. ITIL
• How will I ensure that the vendors I employ
(Information Technology Infrastructure Library)
are successfully aligned with the business
has been used by IT organizations as a best-prac-
objectives I have to meet?
tices framework for IT service management, and
This white paper explores the concept of it has grown to become the most widely accepted
service management and how it can be applied approach to IT service management in the world.
not only as a framework to answer these key The ITIL framework and its best practices can
questions but also to inform the development provide significant value for the implementation
of a new operating model that improves clinical of service management operating models.
development operations of large pharmaceuti-
cal companies. We will touch on what service Based on our experience, we believe that the
management entails, its benefits and how it can service management concepts described by ITIL
be applied to clinical development. We will also can be applied very well to the world of pharma-
introduce a framework describing two options for ceutical clinical development, which we will dem-
how to introduce service management, as well onstrate with two case studies detailed at the end
as provide guidelines for how to choose between of this white paper. The reasons that a service
these two options. model can be applied so well to clinical develop-
ment include:
Further, we will suggest some elements that
we view as critical success factors for how to • The customer-provider relationships that
implement this new model. Finally, we will provide have emerged in many pharmaceutical compa-
two case studies of bio-pharmaceutical companies nies, with the therapeutic areas as customers,
that recently have adopted this model, each to be serviced by the clinical organization as
choosing different paths to do so. their key provider for clinical trials execution.
Service Management:
• The integration of IT capabilities into clini-
cal development business processes to
Definition & Benefits enable enhanced electronic data capture
Service management is the practice of transfer- (EDC), data analysis, trial management and
ring day-to-day management responsibility of monitoring, etc.
operations to an internal or external provider as
a strategic method for improving effectiveness
• The increasing use of external vendors,
which highlights the need for trial
and efficiency. The organization that has direct
sponsors to think and act in a service
responsibility for defining and agreeing to service
management mode when they set up con-
level targets for the services rendered is referred
tractual agreements with these vendors.
to as the customer. The organization that accepts
service level targets and meets requirements to There are significant benefits that the use of a
provide service at the negotiated level is regarded service management model can bring to a clinical
as the service provider.
cognizant 20-20 insights 2

3. development organization. The main benefits • Increased focus on business outcomes: By
include the following: documenting services in terminology familiar
to the business, and by describing their value
• Improved communications with customers: and benefits in a language easily understood
Introducing a service management model by customers, the provider shifts the focus
requires the service provider to work with its from functionality, to business outcomes.
customer(s) in terms of understanding their
needs and requirements and corresponding • Streamlining service activities: Through the
activity of services definition and the service
service levels. This generates more frequent,
supply chain (i.e., how the services will be ful-
streamlined and effective conversations, in
filled), the service provider typically identifies
which both the customer and service provider
elements that are common across services,
start using the same language and increase
which in turn enables the provider to gener-
their alignment.
ate efficiencies and lower costs by eliminating
• More clarity around roles and responsibili- duplication.
ties: The service model requires the customer
and service provider to clearly articulate expec- • Setting the stage for continuous improve-
ment: Putting in place a service model is
tations and roles and responsibilities in order
not an endpoint but rather a starting point
for the services to be provided, consumed
for customers and providers to continuously
and supported in an effective and efficient
work on improving their services, such as the
fashion. This, in turn, leads to better and more
way they are introduced and the way they
meaningful interactions, in which both parties
are delivered to the customer. Continuous
operate in a more collaborative manner.
improvement usually includes identifying and
• Better marketing of services to customers: eliminating gaps and overlaps in services.
Services are introduced to customers through
a service catalog, which lists available ser- Service Management Framework for
vices and their key features. Generating and Clinical Development
maintaining the service catalog drives service
Based on our experience, we have developed a
providers to better articulate and define the
framework that shows two key options for clinical
services to be offered, using phrasing that res-
development organizations that want to adopt a
onates well with customers.
service management model (see Figure 1, below).
Characteristics of Functional and Capability Service Models
Functional Model Capability Model
Services are defined to closely follow the existing Services are defined based on the underlying capabilities
Service working activities of the service provider. These needed to deliver business outcomes, in order to increase
Definition activities are usually functionally aligned with the re-use and streamline operations.
business processes of the customer.
Service-level information is used as an indication of Detailed SLAs are introduced with different levels of
the availability and supportability of services offered service available for customers and spanning various levels
Use of SLAs by the provider, but it is not captured in binding of service availability, supportability and cost. Customers
agreements. choose among service levels based on their needs/
requirements and available budget (e.g., bronze-silver-gold).
The starting point is to turn the current offerings into a The starting point is to transform current distributed
Starting structured, marketable catalog of capabilities aligned capabilities into a service-centric organization, ensuring
Focus with R&D activities and evolve them into streamlined introduction of services from the top-down in a controlled
services at a later stage. fashion.
The initial goal is understanding customer needs, The service support approach and back-end processes are
Service defining them and then releasing a catalog of services developed at the onset of the initiative, to provide the basis
Support that addresses these needs. Support of the services is upon which the services can be introduced and managed.
viewed as a secondary priority.
Adoption rate is intentionally kept low to enable all Adoption rate is generally high, but it can vary depending
Speed of
parties to adjust and learn from the new model. on business readiness and the customer’s and provider’s
Adoption capacity and capabilities.
Driver of The driver is the business or a mixed The driver is typically the IT organization.
Initiative business/IT group.
Figure 1
cognizant 20-20 insights 3

4. Advantages, Disadvantages of Functional and Capability Service Models
Functional / Activity Model Capability Model
Pros Cons Pros Cons
• Services are easily • Limited to no shared services • Development of services • More difficult to implement,
recognizable by customers, benefits. focused on capability, and with a larger impact on
leading to lower resistance. resulting in shared, re-usable the organization, typically
• Limited improvement against
and scalable services to generating more
• Services align well with the current state.
support new or changing organizational resistance.
customer’s business process • Lays foundation only for requirements.
activities, making it easy to services definition to align • More resource intensive and
see how they fit in. with functionality and • Faster to realize increased requires more work upfront
efficiencies and cost savings. before services can be
• Lower resource requirements will require more work in
released into production.
to implement. later phases to build true • Stronger fit with ITIL
service management on this framework used for managing
foundation. services and support.
Figure 2
The pros and cons of each model are compared in While there is no right or wrong model, choosing
Figure 2, above. one that is not aligned with your organiza-
tion will detract from the success of the service
Introducing service management can result in management initiative. To help in making that
multiple benefits, as indicated in the previous choice, we have provided some decision criteria
section. To achieve these, it is important to choose (see Figure 3, below).
the model that fits best with your organizational
capabilities and maturity. It is certainly possible Critical Success Factors
for a company to start with the functional model for Implementation
and evolve into the shared capability model.
To achieve the intended benefits, it is important
However, it is important to choose the model that
for the service management model to be fully
presents the best fit, both with the current situa-
embraced by all parties. Based on our experience,
tion and with the short- and long-term strategic
we have identified critical success factors that will
objectives of the business.
greatly enhance the probability of a successful
Determining the Right Service Management Model
Criteria Questions to Consider
• How established are the communication processes and channels to understand,
Relationship with prioritize and address customer needs?
Customers • How close is the alignment between the service provider activities and customer needs?
• Is there clarity and agreement on who “owns” the customer relationship?
• Is there a clear understanding of which activities are core vs. non-core?
Operational
• How well are processes documented and followed?
Maturity
• What is the level of comfort with continuous process improvement?
• Are different roles and responsibilities within the organization clearly defined?
Organizational
Clarity • Are the leadership teams within the different supplier organizations aligned on the
priorities relating to service fulfillment?
• How much of the service supply chain does the main provider control?
• How well aligned around customer priorities and needs are the different
Provider Complexity
suppliers that need to collaborate to provide and support the services?
and Alignment
• What is the level of experience with managing different suppliers (including vendors) in
servicing customers?
Figure 3
cognizant 20-20 insights 4

5. implementation. In this section, we will address Using the ITIL methodology as the de facto
two very important critical enablers of success. standard of ITSM allows clinical development
organizations to:
Leveraging the ITIL Methodology
• Define and differenti-
With the introduction
As indicated previously, the ITIL methodology is
the most widely accepted approach to IT service ate service levels to of its latest version,
management in the world. ITIL has enjoyed meet requirements ITIL introduces a
and price.
widespread adoption since its publication two lifecycle approach to
decades ago. Indeed, because of its success, • Optimize services
managing services,
ITIL has become synonymous with IT Service through standardiza-
Management (ITSM), of which it is one of the best tion. allowing for more
practices.
• Drive cost reduction robust management
Pharmaceutical R&D organizations can leverage through service- of demand and its
centric delivery of
the ITIL methodology, as it offers a consistent,
capabilities.
changes. This paves
repeatable, controlled and measurable process
the way to a more
for delivering services. It does so while managing • Shift away from orga-
operational costs and capital investments to meet nizational reactivity. efficient way of
business requirements. With the introduction
• Transform the IT prioritizing activities
of its latest version, ITIL introduces a lifecycle
approach to managing services, allowing for more
organization into a to achieve business
true partner with the
robust management of demand and its changes.
business.
objectives.
This paves the way to a more efficient way of pri-
oritizing activities to achieve business objectives. Treating the Implementation as Transformation
Leveraging ITIL to define services, and using ITIL Implementing a service management approach
processes to support and manage the defined will have a major impact on the organization. Not
services, can help clinical development orga- only will your team have to start thinking and
nizations realize significant benefits and even communicating in terms of services, but they will
competitive advantage. The journey begins with also have to change their mindset about what
defining the service portfolio, which encom- they do on a daily basis and how they deliver
passes documenting the provider’s offering and value to customers. As a result, the implemen-
capabilities. The service portfolio management tation must be treated as a real transformation,
process emphasizes strategic thinking to assess focused on establishing a new operating model
the present situation, defining goals to improve with new roles, processes
existing services or introducing new services to and tools. One other reason to treat
support current and future business activities.
One other reason to treat the implementation as
The definition of a service portfolio by the clinical the implementation as a transformation is that
development organization will drive the devel- a transformation is that this will be a gradual
opment of the business and technical service this will be a gradual
catalogs, which is managed by the service catalog process, typically taking process, typically taking
management process of ITIL. Analogous to direct several years to transition several years to transition
marketing catalogs of online merchants and through the different through the different
mailed catalogs, business and technical service maturity levels. Therefore,
catalogs serve as a tiered and structured pre- it will be essential to maturity levels.
sentation of services to customers, with varying take the necessary steps
business requirements and price points. The to keep the momentum going until the initia-
identification, negotiation and institutionaliza- tive’s completion and the achievement of its
tion of services and service levels to align with objectives.
the customer’s requirements and price points
Some of the key elements needed to enable this
encourages the adoption of other ITIL processes
transformation and ensure its success include:
to effectively and efficiently deliver on service
commitments. • Leadership: High levels of leadership involve-
ment will be required to implement the new
cognizant 20-20 insights 5

6. service management model. One key enabler is implementation. These team members will also
to create alignment among the key leaders to have to act as change agents to make sure
ensure they lead by example and set the pace they bring along their peers in the organiza-
for the program by maintaining urgency, focus tion. It will also be important to identify quick
and excitement. Leaders are also expected wins wherever possible and celebrate these
to allocate adequate levels with the broader organization. Overall, the
Overall, the team of investment (dollars and team will have to balance the goal of achieving
resource time) for execut- financial/operational benefits with a strong
will have to balance ing the transformation. They focus on and measurement of behavioral and
the goal of achieving will be expected to make cultural change to ensure that the changes
financial/operational trade-off and prioritization “stick.”
decisions in a timely manner
benefits with a throughout the implementa- • Communications and training: Introducing a
service management model will introduce
strong focus on and tion. Finally, the organiza- many new concepts, as well as new ways of
measurement of tion’s leaders will be needed interacting with customers and suppliers.
in terms of marketing the ini-
behavioral and cultural tiative and the new approach Because of this, it will be important to devote
sufficient attention to communications and
change to ensure that to other parts of the extend- training.
the changes “stick.” ed enterprise (including cus- A good starting point is to identify different
tomers and suppliers).
stakeholder types and their needs from a com-
• Organization design: Introducing and operat-
munications and training perspective. After
ing a service management model will require
that, a plan can be developed, outlining the
the establishment of new roles (for example,
communication and training activities that
“service owners”) and responsibilities in the
target all impacted stakeholder groups. It will
organization. Additionally, as the services are
be important to also communicate with leaders
defined and organized into logical groupings,
in other impacted organizations to ensure
many will see the value of aligning the organi-
they are aware of the initiative and get their
zation accordingly to ensure that the internal
buy-in to contribute to service development
provider group is set up in the best possible
and delivery. Communications with customers
way to deliver the services.
should be a two-way street, including marketing
•
People change management: Implementing a of the services, as well as gathering feedback
service management model is challenging and based on their usage.
time-consuming, making it a
Introducing a necessity to place a strong Based on experience, we know that 100% of trans-
formation programs will show signs of failure
service management focus on people change at some point in time. The key to successful
management throughout
model will introduce the effort. Many transfor- execution is to anticipate and expect these
many new concepts, mations fail to achieve their challenges and be prepared to address them
with appropriate counter-measures, in a timely
as well as new ways stated objectives, so in order fashion. The guidelines provided above will help
to beat the odds and deliver
of interacting with successfully against increas- ensure this happens in the right way and at the
customers and ingly higher expectations, right time.
suppliers. it is imperative from the Service Management in Action
get-go to devote sufficient
amounts of time and resources to the change In the next section, we will describe two case
management aspects of the transformation. studies based on recent engagements we
completed in the R&D units of key pharmaceuti-
Having a fully dedicated team for the transfor-
cal clients.
mation is typically a pre-requisite for successful
cognizant 20-20 insights 6

7. Case Study >>
Deploying Service Management for a Large Pharma Company’s Clinical Operations
Business situation well as identification of priority services and
The client is a Top-10 global pharmaceutical ITIL processes for deployment. Following this,
company that had embarked on a corporate-wide we developed the template for service design
service management initiative in IT. The clinical and facilitated sessions with service owners
development organization launched its own and service managers to populate templates
service strategy and initiative to implement a with high-impact and customer-focused
service management model as part of its ongoing descriptions of services. We provided best-
journey to become a world-leading research orga- practice ITIL/process guidance and drove the
nization. Lacking the necessary expertise, the completion of gap identification and analysis,
client engaged us to provide service management as well as documentation of process flows,
(including ITIL), transformation and change process-process relationships, metrics and
management expertise to define the strategy governance. Lastly, stakeholder assessments
and drive the implementation for the new service were conducted, and a change management
model. and communication plan was developed for
use during the implementation.
Objectives
• Implementation: We assisted the client with
The goals for the clinical development organiza- developing the first release of its service
tion’s service initiative included the following: catalog and helped drive implementation. We
also provided advice to the client to execute
• Providing its business partners and customers a reorganization aimed at aligning the orga-
with high-quality business services, essential nization with the major service categories.
for supporting clinical trial operations. Materials were developed for key communi-
• Ensuring quality on-demand responses to cations, including sponsor updates, presenta-
customer needs through a service catalog. tions to the client staff, customer introduc-
tions, etc. We also conducted workshops and
• Reducing cost and increasing flexibility and
provided training to the team resources, which
efficiency of service delivery and support.
greatly enhanced their knowledge of service
Approach management and how to make sure the
different components work well together.
• Strategy: We conducted interviews and
surveys to gather and analyze information Outcome
related to applications, customers, future
The client organization is well on its way to imple-
needs, etc. and to build a baseline document
menting the new service management model and
assessing the organization’s current state. We
has already achieved the following:
also facilitated a large executive workshop
to decide on the future services and imple- • Implementation of the new organization.
mentation approach. Recommendations were
generated on how to deploy the services and
• Release of Version 1 of the service catalog,
which is now being used as a template by other
adopt the service management framework groups in the clinical development organiza-
using the functional option, as well as the type tion.
of transformation effort needed to put the new
operating model in place. • Increased service management knowledge
throughout the organization.
• Design: We analyzed current-state activities
and processes and made recommendations for • Implementation of key support processes
the overall approach of the implementation, as throughout the R&D organization.
cognizant 20-20 insights 7

8. Case Study >>
Creating a Service Portfolio and Catalog for a Major Biotech’s R&D Arm
Business Situation catalog design and the service maturity model
This client is among the world’s largest multi- were made to align with the organization’s
national biotechnology companies and a global propensity for change. The design of services
leader in genetic disorders drug research. The was conducted with identified service owners
company is engaged in a corporate-wide service and service managers before negotiating with
management initiative to develop and implement customers on the warranted service levels. We
IT service management processes. Its research also populated the service portfolio and catalog
and development organization is leveraging the to support the negotiated service levels and
global IT service management program and has allow for seamless visibility for supporting ITIL
launched its own initiative to define and implement processes.
services, including a supporting architecture. The • Implementation: We led the development of
client engaged us to provide service management the service portfolio and catalog structure and
expertise to architect services to better support assisted the client with the development and
clinical research customers and leverage vendors negotiation of the first release of services. All
more effectively. supporting materials to create and implement
the services, along with a maturity model for
Objectives the services, were implemented. We developed
The objectives for the service management communications material for the executive
initiative included the following: staff, promotional material and sponsor
updates. Training for key team resources was
• Map existing business functions, processes
also performed to ease the transition from a
and applications.
vendor-led initiative.
• Define a service portfolio and service catalog
Outcome
structure.
The client is currently using ITIL processes and
• Define services and document a service
supporting an application implemented by the
maturity roadmap.
IT department to support the services, which
Approach were designed and implemented within the R&D
department to reduce the cost of IT. Specific
• Strategy: We conducted a series of workshops
achievements include:
and interviews to validate business architec-
ture, as well as gather and analyze informa- • Implementation of Version 1 of the service
tion related to business processes, customers, portfolio and catalog.
business applications and projected needs. We
also generated a service model, implementa-
• Implementation of the service maturity model.
tion and maturity model to transform the unit • Implementation of a service-centric organiza-
into a service-centric organization using the tion model.
shared capability option. • Leveraging vendors to fulfill service support
and reduce cost.
• Design: We analyzed the existing business
process and support structure and supporting
applications and validated that the existing • A more robust operating model, enabling
a higher level of outsourcing of non-core
IT applications, processes and activities
activities.
supported R&D needs. Recommendations
for service architecture, service portfolio,
cognizant 20-20 insights 8

9. Looking Ahead onstrated by the companies highlighted in the
case studies above, this approach is setting them
Clinical development organizations in the
on the path to improving relations with their
pharmaceutical industry are feeling relentless
customers and suppliers, while at the same time
pressure to increase productivity and reduce
increasing the effectiveness and efficiencies of
costs. This paper has introduced the concept of
their operations.
service management and how it can be applied
to achieving these objectives. As has been dem-
About the Authors
Thierry Kahane is a Principal in Cognizant’s Life Sciences Business Consulting Practice, with 12 years
of management consulting experience in designing and delivering complex business and IT transfor-
mation programs across life sciences and other industries. He has expertise across the life sciences
value chain, with a particular focus on R&D (clinical development) and sales and marketing (new
commercial models and closed-loop marketing). Thierry has established credentials in design and
delivery of strategic initiatives, the program management of large and complex enterprise transforma-
tions, as well as change management and communications. He holds an MBA from Columbia Business
School and a master’s in commercial engineering from Brussels University. He can be reached at
Thierry.Kahane@Cognizant.com.
Som Chandra is a Senior Consultant in Cognizant’s IT Management Consulting Practice. He has 12
years of experience in service management, business process and IT service architecture, as well as
IT operations management in the financial services, life sciences and manufacturing industries. Over
the years, he has worked on numerous programs to design, build and deliver ITSM solutions and other
strategic initiatives at Fortune 100 companies. Som has a bachelor’s of science and master’s degree in
information systems from The Ohio State University and is ITIL Managers certified. He can be reached
at Som.Chandra@cognizant.com.
About Cognizant
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