Lilly Critical Care Europe and Business Customer Communities

Firms, such as Lilly CCE, have created online communities for their customers to interact with each other and share knowledge. Lilly CCE is a European business unit of Eli Lilly & Company and was founded in 1999 to oversee sales, marketing, customer and medical services for specialty products in the critical care setting. It had approximately 150 employees across Europe and an annual revenue of around USD 100 million. However, the majority of the income was generated by just one high-end, high-priced complex product, which had been in the market for several years. This drug was being administered in specialized centers.

Beginning in spring of 2001, Lilly CCE found the market getting increasingly competitive in most European countries. Competitors increased sales representatives and Lilly CCE's existing representatives found it difficult to provide necessary information to physicians and customers. This forced Lilly CCE to launch a project called the “Customer Community Project” to develop capabilities and infrastructure to facilitate development of BCCs. BCCs can be defined as groups of business customers, which are deliberately enabled by a firm and share a long-term need to exchange work related knowledge through online and offline interaction. Business customers form a community to fulfill a specific purpose. Firms deliberately enable BCC formation through technological (e.g. collaboration technology) and organizational (e.g. workshops and events) means. The type of knowledge exchanged within BCCs is always work-related. Self-organizing customer networks can become external BCCs at the point when they are given strategic attention and support by a firm. The purpose of external BCCs is to foster long-term knowledge exchange between its members. Accordingly, during the period 2002-2004, Lilly CCE initiated over 50 BCCs.

Erat et al. (2006) found that the formation process of a BCC can be divided into four major stages: preparation, planning, initiation, and sustenance. In the preparation stage, an organization should lay out the internal processes and structures that can support BCCs. During the planning stage, sales representatives together with the community leader lay the groundwork: identification of common needs, definition of purpose, and preparation of a kick-off event. During the initiation stage, members come together to launch the communities and generate critical momentum. Lastly, during the sustenance stage, the focus is on sustaining the momentum and keeping the BCCs viable. During this stage communities strive to transform shared knowledge into working practices.

The success of BCCs, measured by the number of customer communities, was surprising. More than 50 communities were formed during the first two years. Erat et al. uncovered that BCCs work best for firms with a superior new product and in a market characterized by information asymmetry. It was also found that knowledge sharing in BCCs depends heavily on the influence of the leader of the community, especially if the leader belongs to one of the participating customer organizations. However, it is critical that the sponsoring organization of BCCs (Lilly CCE) take a backseat and allow BCCs to be operated and governed by customers.

SOURCE: Erat, P. Desouza, K.C., Schaefer-Jugel, A., and Kurzawa, M. “Business Customer Communities and Knowledge Sharing: Exploratory Study of Critical Issues.” European Journal of Information Systems, Forthcoming.