Sample Executive Profile

Biographical Summary

Thomas (Tom) H. Murphy, the CIO of AmerisourceBergen (ABC) arrived at the $72 billion pharmacy distributor after a 20-year career in the hotel and travel industry. Murphy started with Marriott Corp. in 1984 and went on to serve as director of IT for Omni Hotel Group and Interstate Hotels before joining Royal Caribbean Cruise Lines as CIO. Murphy is now heading the company's efforts to encourage the medical industry to adopt new, online technologies and believes one of his most important jobs as CIO is to "build a personal connection with employees." Murphy heads ABC Integrated Business Services, a 175-person team that includes 100 IBM Strategic Outsourcing and System Integration members.

Biographical Highlights

• Earned a BA in Marketing and English from the University of Richmond.
• Marriott Corp. (1984 - 1989)
  - Director, property management systems (PMS) & telecommunications
  - Senior project manager, PMS
  - Project manager, PMS pre-installation and training
  - Support manager, PMS
• Director, IT, Interstate Hotels Corp. (1989-1993)
• VP, IT, Omni Hotels & Resorts, Hampton, N.H. (1993-1995)
• VP, WizCom International Ltd. (1995-1997)
• VP and CIO, Bristol Hotels & Resorts, Dallas (1997-1999)
• CIO, Royal Caribbean Cruises Ltd. (1999- 2004)
• SVP and CIO, AmerisourceBergen (2004- Present)
• Murphy spent 20 years in the hotel industry before joining AmerisourceBergen. He began his career with Marriott and was CIO of Royal Caribbean Cruises before joining AmeriscourceBergen in 2004.
• He says it's important to meet face-to-face with employees even at large companies where it's impossible to know everyone personally. "If you believe that people are the key to your success, building a personal connection is an important piece of sustaining their commitment," said Murphy. "It also gives you a view of organizational realities you don't get when dealing just with reports."
• Murphy adds that it's important to be sincere. "Just don't ask somebody how it's going. Be specific," said Murphy. "People know if you're genuinely interested in their opinions and observations."
• Named to Computer World's "Premier 100 List" of the top IT professionals considered to be exceptional leaders (2002)
• In 2010 he was included in the CIO Hall of Fame.
• Murphy's IT organization is called ABC Integrated Business Services. He calls it a "new organization that is a conglomeration of business process and analytic resources, as well as traditional IT resources". The 175-person team includes 100 IBM Strategic Outsourcing & System Integration members, as well as IBM SI and SAP Consulting resources. The team is located in Valley Forge, Pa.; Orange, Calif.; as well as Pune and Kolkata, India. Starting with a reorganization in 2007, Murphy reports directly to AmerisourceBergan CFO, Michael DiCandilo.
  

Personal Attributes and Interests

• He and his wife Lisa have two sons, Harrison and Thomas, and a daughter, Kate.
• Murphy's hobbies are music, basketball and reading
• When Murphy was pitching his C-level peers for $300 million for a new ERP system, he decided to tell a story and keep it simple. He armed himself with just three slides, one of which pointed out that the company's supply chain application was older than Pong, up came a screen shot from the ancient video game. "It always got a big laugh, followed by a look of dawning realization and fear," Murphy says, explaining that "good sales people use analogies or powerful references, because people don't remember the numbers. They remember the story. I have always said that the CIO's role is primarily a sales role," Murphy observes. "That's really what we do. We have to sell to people who don't know they want to buy." He says he builds presentations on storyboards like movie directors do.
• At Royal Caribbean in the late 1990s, Murphy went against what he knew to be his CEO's views by bringing Internet access to cruise ships. "He was a believer in the cocoon that cruising allows, that people cruise to get away," Murphy explains. "We knew he was wrong." Murphy had his team outfit a ship with temporary Internet stations. They proved so popular that he had to shut them down two hours into a four-day trip because the long lines had disrupted the on-board lobby area. Soon after seeing how vacationers flocked to get online on the high seas, the CEO funded Internet cafes for all of the company's ships, putting Royal Caribbean ahead of its competitors. "Sometimes you have to move people to places they didn't want to go," Murphy says.
• In 2009, Murphy wrote an article in CIO Magazine congratulating the federal government's first official Chief Information Officer, Vivek Kundra, and offering him some advice. "Do amazing acts of daring, innovate to drive advantage, all while reducing spend. As CIO of AmerisourceBergen, a company that operates with a margin thinner than Intel's latest chip, I too have faced that challenge." Some of his advice included: "Use more EQ than IQ as you get started. You need to rally a loosely federated group of agency officials who are probably not keen on sharing. You need to quickly gain their confidence and trust...Listen 90 percent of the time and talk 10 percent...Flatten the organization. The best way to find your future innovators and leaders is to have less hierarchy, less weight sitting on top crushing the spirit of innovation...Eliminate fear from your organization...Establish a clear, simple governance structure that people understand, and stick to it and hire really, really smart people, smarter than you, and to set them free to help you achieve your vision."
• Murphy believes that if employees can get the informaton they need more quickly they could attain clarity sooner for decision making. In a 2011 interview, Murphy notes, "Decisions are composed of fact and feel. Technology can collect and sort facts quickly, but no computer can simulate the gut feeling of an experienced decision maker, he says.Therrein lies an opportunity."

Other Boards and Organizations

• Former Chair, HITEC Advisory Council 2004

Current Focus

• Next phase of business transformation: AmerisourceBergen (ABC) is investing more than $100 million to update its distribution centers and consolidate operations, in what Murphy has called the world's broadest SAP implementation. In November 2010, the company went live with "build one" of its business transformation process that includes an eventual total conversion to SAP. Build one included back-office functions for corporate. Phase 2, called build two, began in the spring of 2011 and was about converting each of the drug company distribution centers to the new system. CEO Steven Collis gave an update on the process in April 2012, saying, that 10 distribution center conversions are complete and the remainder are planned for the beginning of 2013. A"s we have gained experience with the new system, particularly with the corporate and back-office functions, we have already begun to realize some operational savings." CFO Guttman said on the same call that "our SAP implementation is progressing well at the corporate level. The system has reached a level of stability faster than we expected, enabling us to realize some early savings, especially with external consultants."
• Near-term priorities: In Feb 2012, Murphy said that AmerisourceBergen's near-term priorities around rolling out their customer online ordering enhancements, new enhancements to SAP around reporting, bring your own device, and stabilizing their "Integrated Business Services" team that leads the SAP-enabled business transformation
• Educating stakeholders about BPM rollouts: AmerisourceBergen has implemented BPM enterprise-wide and has over 3,000 users (including subsidiaries) and over 200 processes automated. The success of AmerisourceBergen's project and ROI generated by using BPM has helped establish a strong business case for expanding the use of BPM to other areas of the business. Executive sponsorship is integral; when executing a proof of concept for new implementations, executive sponsorship is provided by the department heads, with most BPM projects funded on a departmental basis. AmerisourceBergen's BPM implementations are decentralized. Each business unit has its own BPM program, with its own application server and repository. The company holds workshopsto educate other departments about the value of BPM and helps them identify potential "process" candidates.
• IT Governance: Murphy considers a strong governance model and transparency to be key to executive buy-in and successful collaboration in setting IT objectives. ABC has created Process Center of Excellence, comprised of key business and IT people who assess processes, help with business case development, and oversee BPM projects to ensure they are successful. The Center of Excellence focuses on the following drivers: scalability and cost-effective server infrastructure; ability to recreate re-usable integration components and BPM libraries; develop in-house product implementation expertise. Murphy has also created an umbrella organizaton called ABC Integrated Business Services that encompasses tradiational IT resources along with business process and analytic resources. In a 2011 interview, Murphy states that he is looking to strengthen governance policies and go deeper into social networks and cloud computing. According to Murphy, "We need to continue to integrate with the business, and to break the perception of IT as a separate entity that's not part of the business."
• BPM processes and tools: The BPM implementation team uses a modified version of the Software Development Life-Cycle as its methodology as well as Agile and Iterative development lifecycle. This enables them to categorize and prioritize projects, conduct iterative and rapid development, build reusable components, effectively involve the business, and provide a 30-day warranty as a "cushion" for their implementations. KPIs are built around processes to measure productivity and are defined on a departmental basis. scoping 3-month deliverables and milestones for every BPM project, with defined metrics to ensure they are consistently delivering ROI and adding value to the business. AmerisourceBergen uses the Metastorm BPM Suite for its business process initiatives.The company has over 250 processes deployed on Metastorm BPM and recently extended its implementation to interface with SAP to deliver a one-stop shop experience for users.
• Staying ahead of the consumerization of IT: Murphy told Metis Strategy in 2012 than as technology becomes more intellectually accessible to business partners, his team needs to stay one step ahead of the consumerization of IT curve in order for IT to remain relevant. He also said he is borrowing from the consumer realm by introducing "gamification" into the work environment in order to improve adoption and use of new technology.

Key Challenges

• Doing More with Less: Murphy lists some of ABC's IT challenges as follows: New technologies emerging at at lightning pace, economic pressures bogging down strategic planning, and demand on IT escatling to untenable levels. In an interview with CIO Insight, Murphy says, "I don't see any significant change economically, at least in terms of the focus on 'doing more with less.' But, looking ahead, the pressure to keep pace with technology growth is going to increase exponentially. How do you do that when you can barely get enough money to upgrade a server, let alone start looking at alternative sourcing, social networking, etc.? It's going to add a lot of pressure."
• Helping customers stay competitive: ABC's core customer base consists of small, independent chains that are quickly being absobed by big players that have contracts with ABC's rivals. This puts ABC under more pressure than ever to watch its own bottom line and maintain already razor-thin margins. It also threatens to erode ABC's customer base as more of the small players are absorbed by mega-chains.
• Preparing to employ "millennials:" Murphy says of his and previous generations that "we didn't think the company owed us anything. We were grateful to have work...This generation comes in expecting a lot...this job is just a job. And if this company can't meet their expectations -- ranging from the technology they use to do their work, to the type of work they do, to how "green" or socially conscious the company is -- then they'll go find another place that suits them better...fundamentally, that is the greatest difference between this generation and others. And then it manifests itself in things like, "What do you mean I have to use a BlackBerry? I have an iPhone, and I want to use it." Or, "Why do I have to use a Lenovo ThinkPad? I use Apple. Why can't I use Apple?" That's how they work, how they communicate. You can block Facebook, but they don't distinguish between Facebook as personal and LinkedIn as business. It's all part of their life. There's this blurring of the lines more than anything we've seen, and it's really, really going to impact IT."

Peers and Influencers

• David Yost,Former CEO, AmerisourceBergen - Retired AmerisourceBergen CEO Yost hired Murphy in 2004.

Additional Information