Magazine Article | November 1, 2011

9 Crucial Steps Toward Making The Business Case For Quality

Source: Life Science Leader

By K.R. Karu

Today’s life sciences manufacturers face enormous challenges in managing their quality and compliance initiatives. Market trends point to even greater scrutiny on these efforts as pressure mounts from both consumers and the FDA for manufacturers to deliver safer products and services. To meet these important regulatory challenges, many manufacturers have identified the need to implement a quality management system across the enterprise, automating processes and providing efficient, effective, and timely access to relevant data.

But the task of actually implementing an enterprise quality management system (EQMS) at a life sciences company can often be easier said than done. Cost pressures stemming from the global economic downturn and other factors have created difficulties in making a significant business case for quality management at both large and small companies. And, though no executive will deny that quality is an imperative for their organization, this usually comes with the caveat that implementing an EQMS must result in a tangible ROI for the business.

The following are nine simple steps on how to not only determine the scope and size of your EQMS implementation, but also how to convince the necessary stakeholders that quality management is a business imperative essential to driving bottom-line performance and long-term competitive advantage.

Step 1: Understand The Approval Process
Understanding the process your company uses to evaluate potential capital investments is the critical first step in your project. Meet with your immediate supervisor, someone in the finance department, or a person who has shepherded a similar project through the approval process to find out how your company handles it. Discuss the specific steps that will need to be taken and identify key stakeholders whose support will be needed. Make sure you walk away with a clear understanding on how the process works, who is involved, and what their roles are.

Step 2: Identify Your Champion
Every organization has a hierarchy of decision makers with different degrees of influence in the approvals process. To make the case for EQMS, it’s important to find a partner with both the organizational leverage and the willingness to move the proposal up the hierarchy. In some cases, the right person may be somebody high up in the quality department. In other cases, they may be a senior manager in IT or someone in finance. It all depends on who at your company is involved in financial decision making about major new projects.

Step 3: Determine Your Champion’s Priorities
Once you know who your EQMS champion will be, invest some time to identify specific priorities. For example, if your champion is in IT, you may find that their top concerns are all about reducing support costs by consolidating infrastructure and reducing the number of systems the IT department needs to manage. If your champion is in quality, you may find that training, documentation, auditing, or a new regulation is a principal challenge. Do a little digging, and find out if there has been a recent issue that dominates decision making in your champion’s department or if there is a relevant industry challenge that has been highlighted in their area.

Step 4: Get Resources Allocated For Further Investigation
Most enterprisewide projects require their champion to build a business case to justify the capital spend. Your next step will be to convince your champion and/or your direct supervisor to approve the allocation of resources for further fact-finding. In building a business case, the champion needs to capture all tangible benefits that the company would obtain from implementing the EQMS and then place a defensible monetary value on these benefits in terms of annual savings to the organization. The goal of the business case is to ensure that the project delivers value greater than the corporate hurdle rate for capital investments. The following steps are required to develop the financial business case to ensure the resources are allocated for this endeavor:

  • Identify quantifiable business benefits.
  • Capture the state of the current scenario and collect baseline metrics.
  • Develop a future state scenario.
  • Model future state metrics.
  • Populate ROI data and quantify the benefits.
  • Communicate value

Step 5: Win Support Of Your Stakeholders
It’s vital to get key internal stakeholders involved and invested in the project and to avoid conveying the impression that you are out to change the way their world works. Even if the change is an improvement, stakeholders might be resentful if it is forced upon them.

This is the time to have thoughtful conversations with stakeholders across the various business processes that will be impacted by EQMS. Ask them what they think needs to be improved and what they would like to see changed. Your willingness to listen, discuss, adjust, and make them part of the change process will help to build their support and provide momentum for your ideas at the middle and lower levels of your company. It will also help you gauge the extent of your organization’s openness to change.

Step 6: Gather Supporting Data
At this point you will need to get the information needed for a cost/benefit analysis outlining gains, risks, and resources required to implement a solution, with a focus on the key concerns of your stakeholders. To get the right information, you must engage with the people who are on the front lines of each process and who have the direct experience to help you understand the scope and components of each process. Make sure these people understand your goals and engage with them to develop detailed process maps of both the current and the future states you envision for each process. Be sure to include every process step no matter how trivial.

Step 7: Reengage With Vendors
If you haven’t already done so, this is the time to engage software solution vendors so you can understand the order of magnitude of your implementation costs. If you’ve already spoken to vendors, this is the time to reengage with them. If you’re proposing a centralized EQMS for the first time, the exact scope and details of the project can come later, but you want a solid ballpark figure that takes into account both installation and ongoing maintenance costs. If there is already support for enterprise quality management in the organization, now is the time to get more detailed numbers. Remember that you may want to consider not only the costs involved with your initial adoption of enterprise quality management, but also any expansion plans if they will be implemented in the near-term future.

Step 8: Create Your Business Case Presentation
Next you’ll want to use the information you’ve gathered from stakeholders and their teams as well as outside vendors to build your business case presentation. It should include the following quantifiable elements:

  • current state
  • current state metrics
  • future state
  • future state metrics
  • benefits/value of future state
  • cost of an EQMS
  • justification — ROI/TCO (total cost of ownership).

Step 9: Work With Your Champion To Take The Proposal Through The Approval Process
By this time your champion and key stakeholders should be in support of your proposal. Present your findings and metrics to your champion, and arm them with the information needed to present the investment. Then allow your champion, with your help, to use them political leverage to take the EQMS proposal through the approval process.

About The Author
K.R. Karu is the industry principal for Sparta Systems product management group. He has worked to provide technology solutions to the global life sciences industry for 25 years.