Veranova’s shift to Dynamics 365 is good medicine

New beginnings bring shared challenges

In 2022, Johnson Matthey Health was rebranded as Veranova and ownership transferred to Altaris Capital Partners, LLC. The seven Contract Development and Manufacturing Organization (CDMO) facilities comprising the newly formed Veranova had an exciting path ahead of them, with several challenges to resolve quickly. Key among them were establishing technology solutions and moving business application users away from Johnson Matthey’s technology infrastructure.

The co-located legacy companies had previously functioned independently with disparate systems and processes. To reduce transition costs, Veranova aimed to separate systems quickly—within nine months—while minimizing disruption to the business. But the challenge involved more than software. The company also planned to change where it was based. Under Johnson Matthey, the division had been based in the UK and used on-premises solutions across entities and in the countries and regions in which it operated. Month-end finance closing typically took three weeks. Now that Veranova’s ownership was US-based, adjustments in financial operations rippled across the entire company. 

Production posed another challenge. The CDMOs use a mix of make-to-stock and make-to-order processes across entities that have different regulatory requirements, purchasing flows, storage caps and related production needs.

Leadership recognized the need for data integration and closer collaboration to thrive as a newly combined company. In 2022, the team set out to establish a new IT infrastructure that would: 

• Implement an enterprise resource planning (ERP) solution to support future growth.
• Harmonize processes and workflows for production, finance, sales, and more.
• Standardize naming conventions and data, using one language, for company-wide visibility and access.
• Aggregate data in a central location with global access and analytics.
• Support continuous improvement through application updates and simplified global support.
  
  

The clear choice

To support market growth and effective use of human resources, a common language, streamlined ways of working, and open collaboration were key objectives. Deployments had to be predictable, with careful change management and high rates of user adoption across all seven locations. It was a tall order. With just nine months and a small IT team, a solid strategy and the right support were crucial.

A team formed to determine the best tools and strategy to achieve the company’s goals. They considered several applications, including SAP, Oracle, and Microsoft. After a thorough review with leadership, the team selected Microsoft Dynamics 365 because it met all their needs and offered the most efficient, flexible, and economical path. Its broad suite of products and services, cloud scalability, and access to cutting-edge technology advancements would support future growth—and with built-in security and feature updates, Dynamics 365 eliminated the need for costly on-premises maintenance contracts.

The team selected HSO as its implementation partner. After several planning meetings and assessments, Veranova and HSO agreed on a four-part rollout, starting with the core capabilities of Dynamics 365 Finance and Supply Chain Management, followed by production, warehousing, planning, and sales processes. Future efforts would introduce project and asset management, for a robust implementation of Dynamics 365 across the organization. Given the short timeline and the requirement to minimize costs, the teams decided to use only out-of-the-box features and capabilities. Specific needs that required customization were set aside for later.

The abbreviated timeline meant everyone involved had to work collaboratively and efficiently. According to Sam Rothwell, Solution Architect at HSO, “The project was a true partnership from start to finish and the next phases are already underway.” 

Getting all the pieces in one place

Dynamics 365 Supply Chain Management replaces the legacy procurement solution and offers punchout access to suppliers’ catalogs. Dynamics 365 Finance replaces the legacy ERP for core financial and accounting processes, including accounts payable, accounts receivable, credit and collections, and global financial consolidation and reporting.

With application strategy and solution scope defined, the next challenge was data. The legacy systems had seven different sources with different file types, naming conventions, sizes, and so on. HSO suggested bringing all the data into an Azure Data Lake. This solution would support reporting from legacy systems, and from there, the data could be mapped, analyzed, categorized, and reported. The whole organization could access all data from one central location.

The IT team had another goal for the data lake: to produce the company’s first-ever trend analysis reports on the two sides of its business, make-to-stock and make-to-order. Such reporting was impossible before Veranova’s launch because of the siloed nature of the company’s operations. Paul Asman sums it up this way: “Dynamics 365 is a new world to us because we have all of our data in one place. We're seeing lots of potential here and we haven't even started scratching the surface yet.”

Understandably, this phase was the most complex, but eventually, all data was migrated to the data lake and integrated with Dynamics 365 Finance and Supply Chain Management. HSO and Veranova ran several test rounds, which went smoothly and allowed the members of the finance team to get comfortable with their new system. A cutover occurred on time to meet the transition plan, and phase one for the US and UK locations went live in January 2023.

Work in progress

In the end, only 10% of Finance processes required customizations. Veranova achieved the fastest separation of all companies in the Johnson Matthey portfolio.

Going from seven separate successful pharmaceutical companies to a single entity with shared data, standard practices, and consolidated reporting is a major undertaking. While other phases are still in process, the organization is already experiencing a variety of meaningful benefits.

Faster month-end reporting

Month-end financial closings that previously required up to three weeks are now complete in four days.

Near–real-time reporting across all entities

In the past, all reports ran location by location. And the data was three or four weeks out of date by the time combined reports were produced. Today, Veranova management can see daily or weekly snapshots, without the wait for the month-end process to be completed.

Common product names

With Dynamics 365, products use the same numbering and naming conventions company-wide, offering better visibility and collaboration.

Centralized supplier management

Standard naming conventions, shared processes, and transactional data provide greater efficiency in supplier management and procurement, with cost savings through bulk ordering and distribution between locations.

Better tracking of safety and compliance

Built-in industry-specific guidance and triggers make it easier to track and achieve safety and compliance measures. For example, Dynamics 365 automatically triggers a hazmat pickup notification when a location hits the allowed capacity of a particular compound and reminds users about safe handling and storage of chemicals.

Faster hiring and onboarding

Streamlined human resources processes and common, modern user experience make hiring and training easier in certain markets and has reduced training and onboarding time by two-thirds.

Optimizing for a 24/7 future

Moving into production with Dynamics 365 Finance and Supply Chain Management brought tremendous gains, not only from the functional aspects of the solution, but also in experience and learnings that the team can apply to future implementations.

Phase two of the four-part rollout—production, warehousing, and planning—is underway now, and the company expects many positive impacts. The newly standardized product information will allow management to look across business units to see the quantity of compounds and materials each location has in stock. All seven locations will be able to share materials needed to maintain their production schedules, improving planning and reducing downtime. Currently, if a location is out of needed stock, production stops until the ingredient can be acquired or produced, and completion may be delayed for weeks. Veranova will also be able to establish a 24/7 production schedule, significantly increasing output and improving timelines for customers. 

In its highly regulated industry, it is essential to be meticulous. The team at Veranova looks forward to Dynamics 365 supporting their production processes and easing certain tasks with Power Automate and on-demand reports. They’re also interested in learning more about how AI-driven Dynamics 365 Copilot could support productivity in the future. 

Asman summed it up this way: “It’s a new world to us, having all of our data in one place—kind of like a kid at Christmas.”