case study
Designing an IT carve-out for a pharmaceutical joint venture
Sven Van Hoorebeeck
A pharmaceutical manufacturer operating as a 50/50 joint venture relied entirely on its parent company's IT infrastructure, systems and services under a fixed annual recharge fee. With ambitions to grow significantly, leadership needed clarity on whether full IT independence was achievable and financially viable before committing to a multi-year transformation.
Challenge
IT services, licences and support were sized for the parent's much larger scale, not the organisation's own operations. Decision-making was slow, and the fixed recharge fee offered no visibility on its cost drivers. Reliance on the parent's IT roadmap limited the organisation's ability to set its own digital priorities, adopt new systems, and plan for new markets or future acquisitions.
“Application rationalisation narrowed the cost gap with the parent's recharge fee, confirming that full IT independence was not just achievable, but financially sound.”
Approach
BrightWolves ran a structured, end-to-end feasibility assessment:
Assessed four IT dimensions - infrastructure separation, data and reporting, application decoupling, and ERP migration - to map what full independence would require
Evaluated four ERP alternatives, including the incumbent market-leading system and three right-sized options, on functional fit, implementation effort and total cost of ownership
Defined four carve-out scenarios, each balancing speed to independence against cost, execution risk and residual reliance on the parent
Identified rationalisation opportunities across the application landscape, removing redundant systems and right-sizing overengineered ones
Designed a target IT operating model, sizing the future internal team and defining which capabilities to build in-house versus source through external partners
Built a detailed cost model comparing the current recharge fee against each standalone scenario, covering both one-off investment and annual running costs
Impact
BrightWolves delivered a data-backed standalone IT roadmap, giving leadership a clear, quantified view of the required investment. The assessment showed that a like-for-like set-up would cost more than the current recharge fee, but that a right-sized ERP combined with application rationalisation narrowed the gap to under 3% of total annual IT cost in the preferred scenario.
Beyond the financials, a standalone IT set-up would give the organisation:
the ability to set its own digital priorities
freedom to adopt new systems on its own timeline
faster, more efficient integration of new markets and future acquisitions
Leadership now has a 4-scenario phased roadmap, a sized operating model and a quantified business case to guide the next stage of the transformation.
Summary
A pharmaceutical joint venture, fully reliant on its parent's shared IT infrastructure, needed to know whether IT independence was achievable and financially viable
BrightWolves assessed the IT landscape across four dimensions, benchmarked ERP alternatives, modelled four carve-out scenarios and designed a right-sized target operating model
The business case proved sound: application rationalisation and a right-sized ERP narrowed the cost gap with the current recharge fee to under 3% of annual IT spend
Beyond the financials, independence unlocks the ability to set its own digital agenda, adopt new systems and integrate future acquisitions at the JV's own pace, backed by a phased roadmap and sized operating model