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CIO interview: Elisabeth Stjernstoft, Apoteket

When the Swedish government introduced competition to the pharmaceuticals sector in 2009, the former monopoly faced a major IT transformation

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When the Swedish government monopoly on pharmaceuticals retailing was lifted on 1 July 2009, the government-owned pharmaceuticals retailing company Apoteket suddenly faced new competition.

The politicians then decided that Apoteket had to rip out and replace its IT systems to create a level playing field.

“We had a pharmaceuticals retailing system we had built ourselves, and the politicians said it gave us too much of a competitive advantage,” said Elisabeth Stjernstoft, CIO at Apoteket. “They gave us two years to complete the changeover, and in the meantime our competitors were allowed to use our IT systems while they built their own.”

Stjernstoft took over as CIO at the beginning of 2011, in the middle of the big IT shift. “My predecessor started the process, and I finished it,” she said. “The deadline was the end of 2011, and we made it on time after an absurdly fast-paced changeover.”

Stjernstoft had earlier worked as an IT consultant at Accenture, helping companies such as Swedish postal service PostNord Sverige and telephone company and mobile network operator TeliaSonera with major IT systems migrations. 

“This is why I was recruited,” she said. “But I had never taken part in a changeover this fast. A normal roadmap for this kind of generation shift is five to eight years. It was a very painful journey, with lots of blood, sweat and tears, but Apoteket made it with panache.”

When faced with building a new IT platform from scratch, Apoteket chose not to go for an all-in-one solution. “Instead, we chose what I call a best-of-breed solution,” said Stjernstoft. “We have a standard ERP system from Oracle as a foundation, and then we have built our own solution in the area where we can make a difference – prescription execution. This means we get a competitive advantage and are able to move fast.”

The prescription execution system is built in .Net, and Apoteket also uses Microsoft environments for online and intranet. “Back in 2009, Microsoft’s ERP system could not handle our needs, but Microsoft has moved forward now,” she said. “Oracle was a good choice at the time.”

One thing is certain, said Stjernstoft – she would never go for an all-in-one solution again. “That means you are stuck with a single supplier, and that is never good. You should not have too many supplies either, but always two or three in each major area, so there is some competition.”

An important lesson for Stjernstoft was that during such a big changeover, it is paramount that IT and the business collaborate. “Another important lesson is how important it is for the top management to really back the project,” she said. “And a third lesson is that you should not drive too many changes in parallel, because the organisation gets burned out.”

If she had had the choice, Stjernstoft would never had made the transition this fast. “But now we have a very modern IT platform and no legacy systems hindering us,” she said. “That means we can do whatever we want – the only limit is our imagination. If we, for example, want to create a new mobile application, it is really easy, thanks to the modern IT platform.”

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Earlier this year, Apoteket won the award for best e-commerce and omnichannel at the Swedish Retail Awards. “This made us very happy, since the whole Swedish retailing industry is behind this prize,” said Stjernstoft. “All retailing companies are rebuilding for omnichannel, and we made the infrastructure for this during the big changeover.

“We are true omnichannel – we see all customers as one customer, regardless of channel. Before 2009, everything was in silos: you were different customers in different channels.”

Apoteket's goal is to make it easy for its customers to feel good and be healthy. “We in IT try to help the employees in the stores to deliver Sweden’s best customer interactions,” said Stjernstoft. “We do that by giving our employees an easier work day and helping them to reach their goals. And that is accomplished through really easy-to-use IT systems. The best IT is the one you do not notice.”

Apoteket’s IT department also works hard to come up with solutions aimed directly at the end-customer. “We try to make it easy for them to feel good and be healthy, and there are great possibilities in this area,” said Stjernstoft. “For example, we have recently launched what we call Click & Collect, which means you can order online and then collect the items in two hours. 

“We are also the first pharmaceuticals retailing company in Sweden to allow customers to buy prescription drugs for home delivery via their smartphones and tablets.”

Apoteket’s IT department consists of about 50 people, which is more than when Stjernstoft took over as CIO in 2011. “We had a lot of things outsourced when I began, but I chose to selectively insource several areas – business intelligence, online, integration, retail and Oracle,” she said. “This turned out to be a very successful move.”

Stjernstoft also created so-called competence centres, where people from IT and business work together. “For example, we have a competence centre for retail, handling the logistics for the stores and the regulations surrounding prescription drugs,” she said. “And the IT platform supporting retailing logistics is placed within that competence centre.”

There are three main advantages with selective insourcing and competence centres, said Stjernstoft. “The first is that time to market has gone down radically. For example, when we decided to create Click & Collect, we could launch after just a few months. The other two advantages are that the quality has improved, and the costs have been cut pretty dramatically.”

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