By: Pedram Alaedini* and Iva M. Wilson Ph.D.
Purpose of this article
In this article, we intend to suggest that the most critical element currently amiss in the pharmaceutical industry is its leadership model. We will also hypothesize that an effective leadership model for the life sciences industry is collaborative leadership rooted in groups that operate on the basis of shared power and management among peers and colleagues, rather than direction from the top through a hierarchy of authority as has historically been the accepted model. Since there is today no example of such leadership in any Pharma Company we strongly suggest that be tested in a real environment.
Pharmaceutical industry is vast, complex, highly scientific, and historically profitable. It has been claimed that it would take an average of more than a dozen years and $1 billion to discover and eventually market a new drug. This is shown on the adjacent figure.
Recent changes in the pharmaceutical industry including for example rapid globalization, patent expiries and thin pipelines etc have resulted in even more complexity. Indeed the industry is struggling to maintain its historic profit margins, reputation, and strengths.
Over the past number of years, the growth of the worldwide pharmaceutical industry has been slower than the increases in research and development costs, and this has led to a cost earnings differential that cannot be sustained over the long run.
Obviously, the current industry ailments will not mean the end of its wealth and power. The business of providing health remedies and offering a chance for an extended life will remain strong and profitable as it has since the dawn of humanity. However, as the industry struggles, patients, employees, healthcare providers, and communities will suffer.
Much has been written about the fact that pharmaceutical companies will need to change the way they do business in order to remain profitable in a new and unfamiliar competitive landscape. However, most of these solutions to industry challenges address the business side rather than the people who are involved in its detailed scientific, engineering, manufacturing, marketing, and managerial activities.
Leadership in the pharmaceutical industry
Although it has been many decades since the pharmaceutical industry produced leaders in par with E.R. Squibb and Robert Wood Johnson, by lack of leadership in the pharmaceutical industry, we are not referring to absence of those who are referred to as leaders or are at the top of organizations. After all, it is questionable if any CEO can change the fortunes of a major pharmaceutical company. By leadership, we are referring to leadership based on collaboration by all stakeholders and individuals involved in discovery, manufacturing, approval, marketing, and sales of drugs and devices. We are referring to collaborative leadership in the pharmaceutical industry.
Most discussions of leadership focus on top executives at organizations and work from the top down. They describe the personal qualities and skills of the leader as inspiring, charismatic, intelligent, strategic, decisive, sensitive, visionary, etc. These discussions mostly seem to be searching for Cyrus the Great of our generation to lead large industrial complexes and organizations.
Considering that the 21st century is a different era and pharmaceutical industry a different venture, this view of leadership, specially for our industry and specifically for our time is not only far from reality but outright dangerous. After all, the ultimate objective of our industry, when everything is said and done, is to provide high quality, compliant, safe, and efficacious medicine in a profitable, cost effective, and environmentally friendly manner.
The traditional view of leadership ignores the increasing complexity of the industry and its need to drive efficiencies through outsourcing of activities and use of a geographically distributed workforce. It disregards the fact that all current research and evidence point to the importance of leadership that begins not with the person at the top of a hierarchical organization but with the individuals within it and the collaborative forms of an institution that demand a different type of organization and leadership.
What is collaboration?
“Collaboration equals innovation.” -Michael Dell
While we all recognize the challenges associated with collaboration, probably the one that receives the least amount of attention is the overuse and at the same time misunderstanding of the word, and therefore, the misinterpretation of the concept of collaboration.
The figure bellow shows pictorially the definitions of various ways of working together in an organization
What is collaborative leadership?
Although a simple internet search would reveal many different and sometimes confusing definitions for collaborative leadership, the authors particularly like what has been described by Turning Point, an initiative of The Robert Wood Johnson and the W.K. Kellogg Foundations:
- It is leadership shown by a group that is acting collaboratively to solve agreed upon issues.
- It uses supportive and inclusive methods to ensure that all people affected by a decision are part of the change process.
- It requires a new notion of power…the more power we share, the more power we possess to use.
Collaborative groups are sometimes referred to as self-administrating. In reality and in most cases, such efforts usually depend on motivation by a collaborative leader who rallies a group around a specific cause. However, this does not mean that the collaborative leader must control the process or dictate the direction. In addition, members of collaborative groups might have different backgrounds and experiences, but they still operate as peers and equals. The objective of collaborative group model is not to emphasize differences but to benefit from mutual respect and reciprocity in the exchange of ideas. To truly benefit from the potential of a group, each participant has to feel recognized and valued and share a sense of ownership of process. Indeed, one of the key ingredients for any successful collaborative effort is for its members to share a common vision about the objectives and direction of their effort.
Therefore, collaborative leaders are not necessarily the same as positional leaders who have been assigned to a position in a hierarchical organization such as director, vice president, or CEO. Neither they are situational leaders, those who are asked of or are self-appointed to serve in an interim leadership capacity. In both situations, the role of leadership must be distinguished from the skills of leadership. While occasionally these are found in the same individual, this is not always the case. Because leadership in the collaborative environment is entirely different from hierarchical (positional or situational) leadership, collaborative leaders must guide rather than control and motivate rather than direct. Effective collaborative leaders are individuals who possess a unique and critically important set of qualities and skills. As the great Chinese philosopher Lao Tzu has said:”A leader is best when people barely know he exists, not so good when people obey and acclaim him, worse when they despise him…But of a good leader who talks little when his work is done, his aim fulfilled, they will say, “We did it ourselves”.
Collaborative leadership is the right model for the pharmaceutical industry
We often speak of the life sciences industry as if it were one distinct entity organized in pursuit of a single goal. In fact, the industry and its different elements are built on a philosophy of separation of powers. For example, manufacturing and quality assurance or marketing, sales and compliance groups; or in fact pharmaceutical companies and regulatory agencies operate on a mostly adversarial premise. This separation of power and the fundamentally adversarial nature of the industry mean that no such single entity really exists.
Another characteristic of the industry is the fact that its organizational structures have been designed in a way that would create groups and departments with overlapping and duplicative responsibilities. As anyone having worked in the industry knows, turf wars and dropped balls are common occurrences that in some organizations happen often and create serious issues within the organizations and in dealings with regulatory agencies, business partners, and the patient, sometimes with catastrophic results
The success of a collaborative team relies upon the desire and willingness of participants to dedicate themselves and their time and resources to the collaborative process. It also requires that they set aside individual agendas in pursuit of a shared and larger goal; and to recognize that creating and maintaining a collaborative life sciences organization is a long-term process, requiring the establishment and maintenance of solid collaborative partnerships with other stakeholders. In collaborative leadership model, as the axiom goes, “A good leader inspires others with confidence in him; a great leader inspires them with confidence in themselves.” What can be achieved through collaborative leadership includes shared concerns, diversity of thoughts and experiences, ability to overcome process gridlocks, combined power, innovation, and increased ability to overcome complex issues.
Challenges associated with collaborative leadership
Creating collaborative efforts can be a challenging endeavor for a number of reasons. The pharmaceutical industry is based on a philosophy of separation of powers and adversarial engagement, and therefore its members, departments, and divisions have not traditionally collaborated in order to solve common problems
As a result of these issues and the significant investment of time that building a collaborative organization entails, identifying collaborative partners who are willing to commit to the difficult work of finding common ground can be onerous. Fortunately, in most cases, for those involved in life sciences industry, the ultimate goal is clear: discovering, developing, and manufacturing life saving medicines.
Professionals working in the life sciences industry are increasingly confronted with countless complex problems. However, nontraditional collaborations and partnerships are already emerging as an effective strategy to address the considerable problems confronting the industry. Whether head of quality, manufacturing supervisor, marketing manager, sales representative, validation technician, or formulation scientist, we seek the same end: to produce safe and efficacious drugs or devices at reasonable costs in a profitable manner.
Now more than ever, it is clear that no single individual or organizational entity can independently address the challenges associated with our industry. By relying on organizational diversity and taking advantage of each member’s strengths, the collaborative leadership model will change the way we work. However implementing and maintaining this model will require a profound shift in our understanding of how change is created. Collaboration shifts organizational focus from competing to consensus building; from working alone to including others; from thinking about activities to thinking about results and strategies; and from focusing on short-term accomplishments to demanding long-term results.
1- The Power of collaborative Leadership; Lessons for the Learning organization, Bert Frydman, Iva Wilson, JoAnne Wyer, Butterworth-Heinemann 2000
2- Turning point: Collaborating for a New Century in Public Health. Robert Wood Johnson Foundation
3- Collaborative Leadership, How to Succeed in and Interconnected World. David Archer and Alex Cameron. Butterworth-Heinemann,2009
4- The Importance of Collaborative Leadership in Achieving Effective Criminal Justice Outcomes. Center for Effective Public Policy. Madeline M. Carter. 2006
5- The Leadership Challenge in the Pharmaceutical Sector; What Critical Capabilities are Missing When it Comes to Leadership Talent and How Can They be Developed? Jean Brittain Leslie and Kim Palmisano. Center for Creative Leadership, 2010.
About the authors:
- *Pedram Alaedini is the President and CEO of Primapax Group, a life sciences management and technology firm in Princeton, NJ. He can be reached at Pedram.Alaedini@Primapax.com
- Iva M. Wilson Ph.D. is the president of The Coaching Collaborative LLC an organization devoted to helping organizational leaders create strategies that respond to rapidly changing environments. She is the past president of Philips Display Components Company and past president of Gyricon, a spin-off from Xerox. She is the co-author of the book “The Power of Collaborative Leadership: Lessons for the Learning Organization”.