SESSION 8 - Bayer HealthCare delivers a dose of reality for cloud payoff

Question 1

Whats the article about?

Answer 1

• computing can provide benefits to all orgas regardless of size and geographical scope
  –>not true as reality is muss more complex = one-size-fits-all approach not possible

Question 2

What did Bayers cloud program look like?

Answer 2

• BHC’S organisation: local and global business processes are of high complexity & heterogeneity
• IT organisation: both global and local IT units  local units: strong ownership over IT systems; global units: divided into a) demand IT functions – provides IT expertise to major business functions b) supply IT functions provided at group level
• motivation for cloud initiative: reduce complexity and costs for numerous heterogeneous CRM systems and thus harmonise global marketing and sales processes globally

Question 3

What are the different mantras of cloud computing?

Answer 3

MANTRA 1: HIGH COST ADVANTAGES
relevant factor: cost reduction only true for larger countries operating several legacy systems, smaller countries have much simpler needs which make cloud solutions costly

MANTRA 2: IMPLEMENTATION TIME FOR CLOUD SOLUTIONS IS SHORT
relevant factor: implementation of country-specific regulatory requirements can take long while + time to mitigate from heterogeneous legacy systems

MANTRA 3: CUSTOMISATION OF CLOUD SOLUTION IS LIMITED BUT ENOUGH
relevant factor for customisation need: whether cloud solution is equipped with industry-specific template, whether subunits have complex/unique business processes etc

MANTRA 4: COMPLIANCE AND SECURITY RISKS HAVE TO BE ACCEPTED
* relevant factor for security assessment: type of cloud application & how specific to company’s business it is  different types of applications (ERP, CRM) are subject to different compliance and data security requirements depending on data that is stored

MANTRA 5: CLOUD SOLUTIONS HELP FOCUS ON CORE COMPETENCIES

• factor determining degree of involvement needed from business units: locus of IT ownership and the legacy systems that are in place

MANTRA 6: CLOUD COMPUTING REDUCES DEPENDENCY ON INTERNAL IT

• relevant factor: complexity of business process & specificity of cloud solution to firm  determine capabilities required from IT units = the more complex and globally integrated the processes, the more the internal IT units are needed