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6-2 Johnson & Johnson's Enterprise Infrastructure - Case Study Example

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Johnson & Johnson Company is an international American company that deals in offering consumer packaged goods, pharmaceuticals, and medical devices to its customers. In a move to offer its customers a single point of contact, this company did a massive transformation in its…
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Case Study 6-2 Johnson & Johnsons Enterprise Infrastructure
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Case Study 6-2: Johnson & Johnson’s Enterprise Infrastructure Johnson & Johnson Company is an international American company that deals in offering consumer packaged goods, pharmaceuticals, and medical devices to its customers. In a move to offer its customers a single point of contact, this company did a massive transformation in its information technology infrastructures. These changes were done in all its one hundred and fifty subsidiary companies; a move which presented a tall order in itself. This paper discusses this approach by Johnson & Johnson of providing an information technology infrastructure to support the one-face-to-the-consumer strategy. This paper also looks at the strengths and weaknesses of this strategy.
Keywords: infrastructure, customer strategy, information technology
Case Study 6-2: Johnson & Johnson’s Enterprise Infrastructure
Johnson & Johnson Company is an American multinational company that has been manufacturing and marketing pharmaceuticals, consumer packaged goods and medical devices since 1886 when it was founded (Makower & Pike, 2009, p. 130). In 1995, this company had a plan to offer its key customer with an efficient customer delivery service system through a single point of contact (Ross, 2003, p. 32). This move involved a lot of changes in the company’s structure in view of the fact that, Johnson & Johnson has been operating as a decentralized corporation with nearly one hundred and fifty operating companies. This paper discusses this move by Johnson & Johnson’s towards providing an information technology infrastructure to support its single point of contact customer strategy.
Johnson & Johnson’s Approach to Providing an IT Infrastructure to Support its One-Face-to-the-Customer Strategy
The one-face-to-the-customer strategy was meant to provide the key customers to this company with a single point of contact to this firm’s services and products. This strategy was known as the Johnson & Johnson Health care System that was formed for the purpose of marketing the products of all the existing companies under this umbrella company from a single point of sale (Weill & Broadbent, 1998, p. 19). From this single face, its big customers who consisted of large retail stores in the United States like, Wal-Mart could get access to the variety of products this company sold.
This strategy was a response to the changing trends in the market from stand-alone customers like physicians and hospitals, to integrated delivery system where different stakeholder are becoming interconnected with an aim of delivering quality and cost effective health products. In addition this strategy was meant to ease the difficult work that these companies had made to its customers, in view of the fact that the customers had to bear with a large number of contracts with the various operating companies of this company.
This strategy appeared to be a complexity when it came to its financing. This was from the fact that Johnson & Johnson did not operate as a single company but as a collection of one hundred and fifty companies with different autonomous management and financing policies. Apart from the financing difficulty, presenting a single face to the consumer will require a massive change to be done to each of the operating companies’ information technology infrastructure from the operating unit perspective to a global point of view. This will also involve changing the perspective of every employer in the operating companies from thinking of information technology in an operational perspective to a corporate level. To change this perspective a need to train the staff about the importance of integrated systems and common standards is required.
In creating this strategy this company provided corporate funding for costs incurred in changing the IT infrastructures to be in line with the demands of this strategy. This company did not dismantle the existing operating companies but rather it leveraged cross-company IT capabilities. New formal organizational units referred to as sectors were formed to link up the subsidiary companies with the shared markets and customers.
Strengths and Weaknesses of this Approach
The strengths that this new approach had to Johnson & Johnson include;
Customers are provided with a single point of contact, this reduces the hard work of having to go through all the operating companies since the customer will now get them at a single place
Management has learnt how to asses corporate wide information technology investments for the benefit of the corporate company.
This approach has enabled an alignment of business strategy, information technology infrastructures, and management policies to suit the organizational need.
The company has been able to retain its customers in the ever changing market
The weaknesses off this approach include
Previous success that was manifested by the autonomous management of the operating companies may not be realized since management will now be centralized.
The efficient operation of the operating systems will have to be done away with for the purposes of customer satisfaction.
This process requires major technological changes which will definitely interfere with the way the operating companies’ information technology systems operate.
In conclusion, the plan to offer a single point of contact to the customer through massive changes in the information technology infrastructure was of benefit to Johnson & Johnson. Though it cost much in funding, training and transformation it was in line with the changing market trends.
References
Makower, J., & Pike, C. (2009). Strategies for the green economy: Opportunities and challenges in the new world of business. New York, NY: McGraw-Hill.
Ross, J. (2003). Creating a strategic IT enterprise architecture competency: Learning in stages. MISQ Executive, 2(1), 31-43.
Weill, P., & Broadbent, M. (1998). Leveraging the new infrastructure: How market leaders capitalize on information technology. Boston, MA: Harvard Business School Press. Read More
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