Mölnlycke Health Care’s Mission-critical Projects Succeed Thanks to One Team of Global Expertise

“Capgemini’s Rightshore concept gives us an excellent balance between front office competence and cost efficient back-office expertise.”

Stefan Fransson, CIO, Molnlycke Health Care

Watch the video here

The Situation

Molnlycke Health Care is a leading manufacturer and supplier of single-use surgical and wound care products, with offices and production sites located worldwide. In 2001, Capgemini Sweden successfully rolled out an ERP system based on SAP for Molnlycke and undertook a major upgrade of the entire system in 2008.

This has been such a positive experience for Molnlycke that it is increasingly applying Rightshore, Capgemini’s global delivery model, to more complex, critical projects right across the organization, from management of infrastructure and SAP applications to complex SAP projects.

Stefan Fransson, Molnlycke’s CIO, explained: “Partly this move to India was due to a need to reduce costs but equally important was the fact that we sometimes were unable to find sufficient resources locally for the new applications and the projects we were planning in SAP.”

Capgemini applies its global delivery model with all the work that it undertakes for Molnlycke. The approach creates an optimum solution through one team providing the best global talent in the right location at the right time.

The Solution

The way that Capgemini leverages Rightshore is via a combination of an onshore team in Sweden and an offshore team in India that seamlessly manages the client relationship as well as project management and support activities. The set up goes way beyond a traditional Front- and Back-Office concept to one that embraces a One Team approach.

“There is a combined steering group made up of managers from both organizations who meet on a regular basis and each individual project consists of project leaders from Capgemini and Mlnlycke,” commented Stefan Fransson. “This team mentality even extends to shared risks and rewards, with both parties working towards the same targets and the same incentives. We are investing in a long-term relationship with Capgemini and we regard them as an important partner who can really help us strengthen and grow our business.”

This means that there are very few tasks that are pre-defined for onshore- and offshore team members. The trigger is purely where it is most price-efficient to allocate the work, paying close attention to skills, competencies and desired quality aspects. For example, it is often the case that team members in India adopt client-facing activities.

Stefan Fransson added: “We are so used to using Capgemini as a sourcing pool to strengthen our expertise that we regard it as business-as-usual for us”.

The Result

This way of working reduces the cost of system development, maintenance and programming for Molnlycke by as much as 40%. It also provides them with the right balance of an onshore front-office capability in Sweden and a back-office capability of experts in India that can be quickly scaled up whenever extra resource is required.

“One of the benefits of Rightshore is that it enables Capgemini to respond very quickly to the peaks in our project demands,” continued Stefan Fransson. “It also gives us exactly the right balance between our front and back offices. Capgemini’s onshore resource means we have a team in our own time zone that speaks our language and with whom we communicate on a daily basis. The majority of the work, around 60%, is undertaken by the team’s back office in Mumbai. This gives us significant cost savings as well as the exact pool of expertise we require in order to successfully complete these complex projects.”

In 2008, Capgemini and Molnlycke signed a three-year contract worth €21m that coincides with the launch of the new, more mission-critical phase of Molnlycke’s global offshoring strategy.

“Capgemini’s Rightshore concept gives us an excellent balance between front office competence and cost efficient back-office expertise.”

Stefan Fransson, CIO, Molnlycke Health Care