Richter: Information Technology at Hungary's Largest Pharma

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Richter is the largest pharmaceutical company in Hungary and is considered to be one of prominent producers of generic drugs and generic active pharmaceutical ingredients (APIs). The company is a leader in the global market, but currently it is facing a lot of challenge from other pharmaceutical companies and because of which they can lose their competitive advantage in the pharmaceutical industry. And to cater to this problem they are planning for a global expansion in IT. Currently their information system (IS) is not fully centralized and this is causing a lot of problem in their expansion and cross-company processes. A significant requirement for the information technology is required because their organization is expanding globally and is facing an increased service volume. The case provides two main options for considerations i.e. whether the current IT status of the company is at par with the overall growing demand and doesn’t require any change and secondly whether to expand its IT globally in a more centralized way. There are issues regarding cost and IT strategies of Richter expansion. Richter is considering three challenges for the issue of centralization of affiliates as discussed below.

1. Maintaining Status Quo
* In status quo scenario all affiliate IT departments reported directly into the affiliate management. All those who were involved with SAP reported directly to the Hungarian office. This can be considered to be a semi-centralized system. * The IT governance now has 3 central elements:

* IT infrastructure
* IT support for business process
* Organization of the IT department at the Hungarian head office * For all the IT governance issues, the decision-making process began with one year strategic plan. After the detailed plan was structured, it was presented to the...
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