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Big pharma needs to embrace change, but it's a delicate balance.

The other day I wrote about how change management in pharmaceutical companies involves managing people, pace and planning in the change process.

But pharma faces a larger dichotomy:  How do you foster innovation and growth in an industry where process and procedure are absolutely essential?  How do you encourage the lateral thinking that leads to new medicines when producing those medicines requires stringent adherence to specific processes which ensure safety and quality control?

balancing change in pharmaceutical industry

In my experience, managing change, even in a process-based environment, starts with understanding the psychology of change and how people react to it.

Human beings - whether they work in pharma or in any other industry - are hard-wired for homeostasis:  They want to get to a state of equilibrium where they feel most comfortable and secure.  Changes in the work environment disrupt the homeostasis people have achieved in their day-to-day work lives.  When a change is handled poorly, the drive to get back to a sense of homeostasis can be a real obstacle to successful change implementation.

So what do you do?

Fortunately, humans are also hardwired for storytelling:  They'll become engaged in stories that have a 'goal', they find narratives compelling, and are driven to 'finish the story'.  These traits can be used to institutionalize change even in the most procedural-based organizations.

Things to keep in mind:

  1. Successful change management happens when leaders understand both the psychological and the operational effects of change on their employees, and how they intersect
  2. The better organizations understand the psychological effects of change on their employees, the more they can plan for smooth transitions
  3. When employees are encouraged to redefine what change means to them - acknowledging the fears engendered by moving out of homeostasis - the more engaged they become in the process and the more they're able to 'own' the story
  4. When employees 'own' their own change story, they are more likely to be invested in coming to a successful conclusion

Instead of seeing change as a short-term, finite event that occurs at irregular intervals, make gradual, continuous change part of the organizational 'story' and culture.  By establishing a culture in which gradual change exists side-by-side with process and procedure, pharma companies can establish an environment in which 'homeostasis' includes both adherence to procedures and a more positive response to change.

 

 

Your sales force can be your best supporters - as long as you manage the process

One of the best things about leading a change management initiative which is focused on transforming the sales function is that salespeople, by their very nature, tend to be enthusiastic about change:  They're good at spotting opportunities, they adopt and adapt rapidly, and they aren't afraid of 'getting out there' and trying new things.

Except these qualities are also exactly the ones that can get a change management project into real trouble.

swimmers and salespeople diving right in

Salespeople tend to want to take action, and they like to communicate, so without the right controls in place, a change management initiative can misfire - the sales force can start implementing changes before the final pieces are all in place, and the rumor mill can go into hyperdrive.

So how do you manage a change initiative which has a large sales force component?

Start by managing these factors:

Ensure you have the 'big picture' mapped out before you start talking about the details:  Getting into the details before you know what the end point will be often triggers early adopters to take action - but without knowing the end point, you risk sending people off in the wrong direction.

Engage salespeople in the process:  The best salespeople are highly engaged in the organization and in their own role in it - they have a keen sense that their own effort produces demonstrable results.  Dropping changes on them without getting their input or feedback can cause alienation - which means you could lose your best salespeople.

Communicate as much accurate information as possible:  Salespeople are natural communicators, and in the absence of accurate information, they'll end up speculating, which can cause misinformation to take hold.  During the change process, it's important to communicate early and often, to ensure the right message is disseminated.

Understand the psychological effect of change:  Top salespeople tend to bring their emotions to work - and that's a good thing, because it helps them build relationships with customers.  But it also means that they can have strong feelings about change initiatives.  It's worth taking the time  to make sure that the sales team clearly understands the change - the good and the bad, and how it will affect them - in order to get them on board.

Your sales force can become your most enthusiastic supporters, and they can lead the rest of the organization in a change initiative - as long as you properly harness their natural strangths to do it.

 

 

 

 

 

When it comes to keeping great employees, compensation is still the most important motivator.

Recently I read a couple of articles on Inc.com by Jeff Haden:  "8 Things Your Employees Need Most" and "4 Rewards That Are More Powerful Than Money".

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In them, Jeff talksabout how employees are motivated by things like 'freedom', 'mission' and 'rewards' than they are about straightforward compensation packages (i.e. salary and benefits).  He even says "Employees don't want to work for a paycheck; they want to work with and for people."

It's true that not everyone is motivated by the same things, and everyone likes to feel respected and valued in their workplace.  But the reality is that day-to-day intangibles like being asked for input or being recognized for a job well done are short-term motivators that only go so far.  Over the longer term, as your employees look to achieve things in other areas of their lives - taking vacations, buying homes, having children - money starts to assume more importance.

If people really preferred 'people' over 'paycheck', they'd be doing volunteer work instead of spending time in productivity analysis meetings.

The internet is filled with opinions.  The facts are often held within organizations.

Most large organizations, especially ones with turnover and attrition challenges, conduct 'exit interviews'.  When employees leave, they meet wtih someone from HR and discuss their experiences with the organization and their reasons for leaving.

These exit interviews aren't anonymous, so employees - especially the A-list ones, who know better than to burn their bridges - are circumspect.  When they're asked about why they're leaving, they talk about neutral, inoffensive things like "I was offered a terrific opportunity to grow my skills" or "I've always wanted tow ork in a startup environment" or even "The new job means I don't have to spend as much time communting".

However, when you ask recently-departed employees why they really left, and do it anonymously, they paint a very different picture:  The majority say that they left because they wanted to make more money (or a larger compensation package).  But this information is never made public, because what company wants to admit that 90% of their people leave simply to make more money?

(Now, it's worth noting that the second most common reason that top performers leave a job is that they could no longer stand an overbearing or incompetent manager - but this is a distant second to compensation.)

I definitely agree that the intangibles - consistent feedback, rewards and recognition, employee engagement, asking for input and ideas - all contribute to a positive work environment, and a positive work environment promotes productivity, builds the employment brand, and can compensate for things like an inconvenient office location or a high-stress industry.  But in the long-term, below-average compensation will cost you your top performers.

 

 

 

 

   

 

And maybe it's better that way.

It happens all the time:  I'm taking questions after a speaking engagement or meeting with senior leadership execs, and sooner or later someone says "I really want us to become like the Google of our industry!  How can we do that?"

you're not google change management

I understand the sentiment:  In just 14 years, Google has become the dominant player in search, online advertising and browsing; made smart decisions like YouTube and Blogger; and, perhaps most importantly, built revenues of $37 billion annually.  It's got a cool brand identity and its 'Don't Be Evil' mantra is a strong one.  It's hard to argue with that kind of success.

I agree that corporate culture - which Google has in spades - is a key driver of success.  It's natural to think you want to built an organization where there are free snacks for everyone, people bike around the 'campus', and you attract the best and brightest.

But Google is a high-tech company which lives and dies by maintaining a reputation for being right out there on the edge and filling their organization with hyper-creative people who are passionate about things like artificial intelligence, neuroscience and Raspberry PI.

These things aren't necessarily going to be achievable if you're in the business of organic food products or high-end home fashions, and in fact they may not be best goals for your business, either.

Here's why:

  1. Your people:  As we discussed the other day, different industries attract different types of people.  Unless your organization has a whole lot of eccentric, coffee-fuelled engineers and developers hanging around, trying to turn yourself into a Google Campus is going to be an exercise in futility
  2. Your industry:  Having a reputation for being cool and cutting-edge is great for a high-tech company like Google; it's less attractive for a company in the business of making baby products, where a more traditional, family-oriented feel is more appropriate
  3. Your business goals:  It's tempting to want to be a $37 billion organization - but that was never Google's sole goal and it shouldn't be yours.  Make sure you have solid business goals that make sense for your organization and the vision you are trying to achieve, and the money will follow
  4. Your marketplace:  An organic foods company which seems to spend more time on building profits and achieving world domination than on promoting healthy eating is soon going to find they've lost credibility with their target audience (see my note above about your business)
  5. Your history:  Google was able to start from scratch with a very specific vision.  If you've already been in business for 25+ years, with an established culture, brand and place in the market, trying to shoehorn your organization into a whole new mold may not be the best use of your resources.

If you want to encourage the qualities you admire in Google, like following a compelling vision or encouraging employees to be passionate about their work, I'm all for it.

But the most successful organizations, like Google - the ones which lead their industries - are ones which are realistic about their culture, their business goals, their people and their marketplace.  The beest way to 'be like Google' is to try to be the best in your field - not the best in someone else's.

 

 

 

 

 

 

 

 

You chose your people because they love structure.
Don't expect them to love change, too.

Scarcely a day goes by that I don't read another article about the benefits of entrepreneurial thinking in the workplace and how fantastic it is.

change management in pharmaceutical industry

It's not unusual for change-based initiatives, even in large organizations, to start with this desire to be more 'entrepreneurial', to be more 'responsive' and 'nimble', and to tap into 'big thinking'.

That's great, as far as it goes - but when it comes to actually implementing business changes, things are a little more complicated.

The pharmaceutical industry isn't Silicon Valley

In the last 20 years, I've led a lot of change, transformation and training initiatives, both client-side and as a consultant.  During that time I've learned that it doesn't matter what the spreadsheet says will happen if you make some changes, your success ultimately depends on one factor:  People.

Different industries attract - and flourish with - different types of people.  While tech startups and ad agencies do best with people who like to think of themselves as highly dynamic, creative 'change agent' types, the pharmaceutical industry does better with structured thinkers who are comfortable with process and rules.

This isn't a bad thing:  The pharma industry is highly regulated, legislated and controlled, and it's important that serious rigor is brought to everything they do.  It's not unusual for a new product to spend 10-20 years in research and development before it launches, and I for one am happy about this - I'm much more comfortable knowing that the medicine I'm taking in the morning has had years of careful testing and scrutiny before it's hit the shelves.

However, this does have significant implications for change management within the pharma and healthcare environments, and it's important to address these.

Successful change within pharma

Ultimately, leading and managing change within pharma companies - especially large, global ones - comes down to addressing 3 key factors:

1.  People

Recognize that the majority of your employees are more comfortable with structure and an established set of parameters than they are with adapting to rapidly changing environments.

This doesn't mean they will be resistant to change efforts - they're more than intelligent enough to recognize the need for change - but it does mean that they may require more communication, more encouragement to become fully engaged, and more reassurance throughout the process.

2.  Pace

When you're working within a highly structured environment, it's important to understand that the pace of change may not be quite as fast as senior leadership would like.

Most pharma companies are, of necessity, large organizations that simply can't turn on a dime.  Trying to implement change too quickly can set the stage for failure; starting and stopping will cost you momentum and make it more difficult to engage employees.  Setting a realistic, steady pace for change from the beginning will go a long way to ensuring success.

3.  Planning

Half the battle in any successful change initiative is successful planning.  In the pharma industry, it's even more important to ensure that scope, requirements and expectations are established at the outset - and that there aren't dramatic changes of direction mid-stream.

You'll find your employees will be much more engaged and enthusiastic - and productive! - throughout the process when they feel that the change is unfolding as planned and that they can see a clear outcome.  After all, that's how they approach their own work.

   

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Beth Banks Cohn, PhD, founder and president of ADRA Change Architects, is dedicated to helping you and your organization reach your full business potential…
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