MDM

MDCM, Inc.: IT Strategy Synchronization &Strategic IT Portfolio Management

As we examining a case study about MDCM, which being largest Contract Manufacturer for Medical devices is suffering from financial loss of $ 33 Million for consecutive Quarter in 2002. CEO McMullen has taken over the command since last 2 years. His strategies to work on operation and cost improvements have not been effective, so far. He still has a year ahead to implement and make improvements in his plan.

Management Concerns:

- CFO Sharon: Information access is not instant and takes 45 days : Solution – IT access

- VP Mktg. Pat Perry: Information access and task improvement with IT solution, online ordering and account Management. “Solution – CRM

- COO Michael Shed: Forecast not accurate, order management weak, high inventory carrying cost.: Solution – ERP

- CIO Shawn: IT Strategy and Framework: Solution “IT framework Solution”

MDCM: Diversified and global organization, as we read we get the scale of operation as we see that MDCM has location in 35 cities, MDCM Corp., USA being oldest and largest. As the operation is purely manufacturing and operations driven, MDCM does not do any R&D and marketing, they are purely contract manufacturers. Major problem is with the margins, as they do not have any control, which will be managed by their Customer who will be selling to the Consumers. MDCM is sandwiched between and has no control or power to salvage their Margins. MDCM planned for diversification, and started a strategy of acquisition to have economy of scale as there is no other alternative to achieve the Cost benefit, when you are fighting on Cost differentiation. This lead to material mismanagement and dysfunctional operations, as sourcing has red...

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...T objectives

DECISION - IT Alignment to Corporate Goals

Organizing model. Should the company adopt a centralized, decentralized or hybrid approach? Hybrid

Investment. What should the company invest in, and how much should it invest? 80% of Budget for Development

20% of Budget for Maintenance

Architecture. Should the company emphasize stability or flexibility? To what degree? Should applications be externally purchased or internally developed? Should there be a single, comprehensive ERP application or multiple applications? Flexibility - Single ERP package

Standards. Which components of technology should the organization standardize and which standards should it adopt? Standarize all the systems

Resources. What types of resources should the IT organization utilize and what should be the sourcing of those resources? 70% In House development and 30% partnership