Quest Makes Fish Walk Up Trees

In late 1999, Quest completed a $1.3 billion deal to acquire SmithKline Beecham Clinical Laboratories, a part of GlaxoSmithKline plc.

InformationWeek Staff, Contributor

September 12, 2001

3 Min Read

InformationWeek 500 - Health Care and MedicalGerald Marrone had a tough year. As CIO of clinical testing company Quest Diagnostics Inc. in Teterboro, N.J., he was faced with a challenge many technology managers would consider their worst nightmare: the acquisition and subsequent integration of a major competitor.

In late 1999, Quest completed a $1.3 billion deal to acquire SmithKline Beecham Clinical Laboratories, a part of GlaxoSmithKline plc. The massive merger meant huge IT challenges, not only in the integration of voice and data networks, but of laboratory equipment, clinical software, interface devices, applications, and services.

Marrone and his IT shop rose to the challenge and have nearly completed the integration. It was a job that sometimes required them to perform nearly impossible tasks. "We made fish walk up trees," he says. But now that it's almost over, Marrone's experiences can serve as a guide for others faced with a similar task.

After finding out about the acquisition, Marrone had to wait for certain legal issues to be resolved before he could talk to his counterparts at SmithKline and figure out what the job looked like. The moment they had permission to talk, the work began.

"We put a team of people together from both IT organizations very early on," Marrone says. "First, we dealt with infrastructure. We tried to do an assessment of what each company's capabilities were and come up with a strategy."

The team put together a plan that began on day one of the merged operations and continued until two years later. "We had an integration plan that had in the very high hundreds or low thousands of different milestones," Marrone says. The team prioritized the different tasks and shared them with business partners, getting agreement that their priorities were straight.

With careful planning, the team was ready to go, and on the first day of merged operations, everything went smoothly. "When we fired the gun, we did what we had to do," he says. "Within a couple of hours, voice and E-mail systems were interfaced."

The following months had their challenges, particularly in trying to keep the chaos from impacting clients. "Our customers have interface devices that they use to connect to our lab systems," Marrone explains. SmithKline and Quest each had their own versions of the interface, PCs running different software. Marrone's team could have chosen one of the systems to stick with and replaced the other, but that would have thrown many customers for a loop. Instead, they built an interface that would accept and process information from either program, functioning as an interpreter. "We did the work on our end, as opposed to the customer's end," Marrone says.

But as with any operation this large, it didn't all go smoothly. "There were subtle differences in the systems that we didn't see when we planned," Marrone says. "Those nuances cost you a lot of hours to figure out. To some degree, we were a little naive."

And now, with what he hopes is the worst of the task behind him, Marrone is in a good position to offer counsel to those who face similar projects. His main advice: plan.

"The money and the time you spend and invest in planning pay dividends a thousand times over," he says. "There's no shortcut for that."

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