IT StrategyRaj Sheelvant’s blog on harnessing Information Technology to create and sustain competitive advantage for the businesses

Model IT Department at Genentech

Genentech is a San Francisco based Biotech firm. I read an interesting article about Genentech’s IT Department in Financial Times titled Soft skills reinvent IT’s place in business

Todd Pierce who is the VP of Corporate IT of Genentech is instrumental in changing the way the IT department functions. I think, they have a model that every company’s IT department should study and try to emulate.

Here are some of the things the IT department of Genentech is doing right

• The IT department has moved away from being technology centric to being a customer centric organization. This means that they collaborate very closely with their customers (other departments) and don’t build software systems in vacuum. IT departments in most of the firms are notorious in their focus on only technology. With no incentives to focus on customer needs, most of the time the IT department is not in alignment with the business needs of the organization. To focus on the needs of the customers, Genentech’s IT department is training its IT workers with ‘soft skills’ like emotional intelligence. They have identified their core competence and differentiation which Mr. Pierce calls ‘empathy-driven’. By aligning their IT department with the core competencies and their corporate culture, IT department is going to play an important role in Genentech’s Business Strategy. The finance department will stop looking at IT department from a cost center perspective but will begin seeing them as partners in improving the top line as well as bottom line.
• The corporate IT department participates in weekly meetings with scientists (their customers) to see where demand is headed. By understanding the supply demand situation of an organization, the IT department can look for ways to build software applications to enable demand forecasting and streamlining supply chain. In any firm it is extremely important for the IT department to do everything possible to enable the firm to understand and meet the demand and thus increase the revenue stream.
• The IT department has also initiated ‘IT Strategy Council’ - Governance Board comprising of Mr. Pierce and the head of other departments as well as top level executive. This management board is involved in streamlining IT projects by prioritizing them. By working on only the top priority projects, Genentech’s IT department will be able to add huge value to the organization. IT department can use this council to not only drive consensus in identifying the top priority project but also to decide on outsourcing or stop working on low priority project. Mr. Pierce is a not intimidated with the trend where their IT department does the bidding for the IT project against outsourcing firms.

By understanding their core competencies and recognizing the priorities, the internal IT department has a huge advantage in building software applications and tools that will create and sustain Genentech’s competitive advantage.

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Wednesday, November 7th, 2007 at 5:57 pm and is filed under Human Resource, Business Strategy, IT Strategy, IT Management. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.