Investigating the role of digitalization in operational excellence programs - a case study from the pharmaceuitcal industry

For years, manufacturing companies have been implementing Operational Excellence (OPEX) programs with the goal of effectively and sustainably improving their performance. Now, companies are also gradually recognizing the possibilities of Digitalization for advancing their operational processes. Even though both OPEX and Digitalization are directed towards the same goal of improved operational performance, there is neither an answer in research nor in practice on how they are or can be interlinked. That is, how processes and the organization to align and reconcile should look like?

To address this question, we conducted 25 interviews with pharmaceutical companies. Thereby we interviewed corporate OPEX functions and Digitalization experts over a timespan of three years. That way we also examine whether companies have adapted and investigate patterns in their development.

Our findings acknowledge that pharmaceutical companies aim to exploit synergies between OPEX and Digitalization for achieving higher operational performance. We further applied a dynamic capabilities perspective to identify how companies align OPEX and Digitalization. Our limitation is that we conducted interviews only within the Pharmaceutical Industry and that each company is unevenly reflected over the duration of the investigation. However, we mitigate that limitation by considering a rather large number of cases reflected in a sample size (16 companies) with a good balance of different company sizes (2.000 –110.000 employees) and business areas (generics, labelled, and contract manufacturing).