The pharmaceutical industry is undergoing profound transformation. As healthcare reform policies continue to advance and market competition intensifies, both employee turnover and attrition rates are on the rise. Many pharmaceutical companies are attempting to consolidate their fragmented business operations through mergers, acquisitions, and restructuring, but the resulting management challenges often exceed expectations.
Novartis, a leading global Swiss pharmaceutical company, has also sought solutions amid this transformation.
“CDP is a trusted strategic partner, and we are sincerely grateful to CDP for helping us become a respected company in China. This means a great deal to us.”
— Carlo Perone, Head of Human Resources at Novartis
Global Business Facing Challenges in Local Markets
Headquartered in Basel, Switzerland, Novartis ranks among the world’s leading pharmaceutical companies. Operating directly through dozens of subsidiaries in more than 140 countries, Novartis employs over 138,000 people, and its products benefit approximately 1.2 billion patients. Fortune magazine has named Novartis one of the "Most Admired Pharmaceutical Companies" for three consecutive years.
However, beneath the aura of large-scale, cross-regional operations, Novartis China faces a series of practical challenges.
Traditional payroll calculation methods make it difficult to ensure accuracy. Back-end systems are inadequate, and data from local branches is scattered across various locations, preventing a unified view. Obstacles in employee onboarding and handover processes significantly constrain the efficiency of HR operations.
For a pharmaceutical company renowned for innovation and rigor, these issues not only impact daily operations but also risk slowing the pace of overall business transformation.
Novartis needed not a patchwork solution, but a comprehensive transformation plan.
Faced with a decentralized business structure and growing management complexity, Novartis realized that piecemeal optimizations could not fundamentally resolve the issues. What it needed was a comprehensive human capital management solution covering compensation, data, processes, and services.
This was precisely the starting point for CDP to enter Novartis' radar.
CDP has become a strategic partner of Novartis thanks to its reputation as a leading human capital management service provider in the Asia-Pacific region, its innovative SaaS-based business model, and its extensive experience serving multinational companies in China. Key considerations include: CDP has a large number of successful SaaS implmentation in China, is able to seamlessly integrate global standards with local requirements, and offers flexible one-stop services covering the entire enterprise lifecycle.
A Phased, Steady Rollout: A Scalable Implementation Path
The project adopted a phased implementation strategy to ensure each step was solid and controllable.
Phase 1: Payroll Outsourcing First
CDP has launched its payroll outsourcing service, which includes integration with the SAP core system, payroll calculation and reporting services, employee self-service, HR self-service, tax filing, and an employee call center. The initial phase covers multiple Novartis branches and thousands of employees, and the system has gone live successfully.
Phase 2: Shared Service Center Implementation
Building on the foundation laid in the first phase, CDP launched the construction of a shared service center to establish a platform for efficient process systems. The project’s service coverage and workforce continued to expand, and the system was successfully launched and has been operating stably.
Phase 3: Regional Expansion and Localization
Novartis' Hong Kong branch was incorporated into the Shared Service Center's scope of services. To address local Hong Kong policies, CDP provided comprehensive support, including strict payroll timing controls, data interfaces, payroll calculations, statutory and customized payroll reports, annual personal income tax filings, payroll services, and a Cantonese-language call center.
With this, all Novartis employees in China have been integrated into a unified human capital management platform.
More Than Just Efficiency Gains: A Cornerstone of Strategic Transformation
The value of the project is clearly evident across multiple dimensions.
Significant Optimization of Production Costs—The unified compensation system and shared service center have substantially reduced hidden costs associated with repetitive tasks and decentralized operations.
Transparent Management Becomes a Reality—With group-wide data sharing and standardized, rigorous processes, management can monitor key human capital dynamics in real time.
Deep integration of business and finance—The integration of HR data with business data provides a reliable basis for resource allocation and strategic decision-making.
Support for business transformation and strategic goals—This solution not only addresses current operational pain points but also lays the management foundation for Novartis' continued expansion and business restructuring in China and across the Asia-Pacific region.
A Proven Methodology That Extends Beyond Novartis
From payroll outsourcing to shared service centers and regional expansion, Novartis' collaboration with CDP has charted a comprehensive transformation journey. This phased implementation methodology respects the pace of corporate change while ensuring that each phase delivers measurable value.
For pharmaceutical companies facing similar challenges—such as multiple branches, diverse payroll rules, and high employee turnover—Novartis' experience offers a clear lesson: the transformation of human capital management does not require a complete overhaul. Instead, it can follow a clear path, progressing from accurate calculation to effective control, and from effective control to optimal utilization.
As more and more companies begin to elevate human capital management from a back-office function to a strategic engine, the competitive landscape of the industry may well be reshaped as a result.
