The Cost of Not Acting Now

Readiness
BY ELIZABETH RUTHERFURD

Using Process to Stabilize High Growth

Companies across all industries rely on cross-functional teams to execute on the goals of the organization.  Issues with functional alignment, priorities and decision making often arise, but are rarely solved. Regardless of the hurdles, which vary from organization to organization, similar pain points arise as a result of overlooking the need for strategic, well-designed process.

Future State consultants see a variety of pain in our work with clients; some examples are an inability to maintain or gain competitive advantage, waning or non-existent innovation, long cycle times on product development and general inability to pivot and shift to changing forces internally or externally. This pain has a major impact on performance, morale and ultimately the success of the company overall.

Here, Elizabeth Rutherfurd, Client Portfolio Director at Future State, provides examples of such pain points and illustrates why a lack of process is often the reason for the pain.

Warning, you might relate.

GROWTH

Growth opportunities can overwhelm the processes, people, and infrastructure of any company. Although rapid growth occurs with highly successful companies of all types, Biotech companies in particular often experience this pain point because they are notoriously fast-growing.

The Scenario: The company has a good idea or product and begins to experience high growth. During the early stages, they add people to move forward, usually with some early investment. Typically, those efforts result in some positive data in clinical trials, and the company begins the arduous journey toward commercialization of the product.

To stay afloat and meet resource demands, leadership starts ‘throwing bodies at the problem’, sometimes increasing headcount by 100-200% or more in a year. These people, however, come from other organizations. They say, “at Company A we did it this way. At Company B we did it that way. At Company C we did it this way.” What results is a lot of well-intentioned people all trying to do the same thing but in many various ways.

The Outcome: Many ways of doing work without a clear, simple and streamlined process creates confusion, frustration, and miscommunication. Quality begins to degrade, and the resultant regulatory impacts from being out of compliance or simply disorganized begin to create more chaos. This is an extremely common problem, and unfortunately, the outcome can be disastrous if it results in a regulatory fail. At a minimum, people are focused on fighting fires between functions and their attention is taken away from delivering on the ultimate business outcomes.

What’s at Stake: The benefit to patients. A company may have a potentially life-saving product, but because it didn’t make the proper investment into infrastructure and process development, onboarding employees thoughtfully, it risks realizing the potential benefits of the product, and the customer or patient never realizes the benefit—improved health, better quality of life, or even a longer life.

Additional Growth Pain Points:

  • Variable, inefficient processes are not scalable for additional growth
  • Grassroots improvement initiatives in silos result in suboptimal E2E performance
  • Compliance and quality impacts

CULTURE

Seen among all industries, culture suffers from a lack of intention. Without clearly tending to culture, it grows wild, like a garden that has no gardener.

The Scenario: The 40-person meeting. We’ve all been in one. The entire meeting began in an attempt to overcome silos, bottlenecks, and lack of communication. Yet, it is possible, that no actual decisions are made at this meeting. We see it often.

It begins with the people who see the need for the meeting and are trying to gain information from others in the organization. Then four more join after hearing about the meeting and finding some relevance in attending. People are now flocking to this meeting because they’re not getting the information they need and hope to find it here.

The Outcome: Team members are trying to pre-empt the fact that there’s going to be a critical outcome later on down the line, and they need information now. When there is a lack of standard process, clear communication triggers or clear decision points, people begin to compensate for that lack of information by attending meetings where they hope to find gain insight and awareness of what’s going to occur at crunch time.

This meeting grows like a fungus. Think of a kid’s soccer game where everybody is chasing the ball, but no one has an actual role. Children aren’t staying in their positions to receive the ball when it comes. They don’t understand the team’s overall goal, so they are desperately chasing the ball. Consider that ball the information team members need.

What’s at Stake: Rapid cycle time and decision making toward strategic business outcomes. At a minimum, these meetings are expensive. Add up the cost of each employee attending these large, hour-plus weekly meetings and you’ll find you are paying an extraordinary amount of money for a meeting that likely isn’t effective at achieving its desired outcome.

Additional Culture Pain Points:

  • Continued challenges with prioritization
  • Capacity is reached – ineffective use of time, repetitive meetings, fire-fighting

PEOPLE

“Hero fatigue,” the overperformance and eventual burnout of the best and brightest people in an organization, impacts retention. We see this across many industries, but here we’ll use the pharmaceutical industry as an example.

The Scenario: You need something done, give it to a busy person, right? These are the connectors, the mavens, the getter-doners. They are the individuals who develop relationships across the organization and across silos to make up for the lack of focus on cross-functional teamwork and prioritization toward strategic business outcomes. They are the best and brightest, most committed to your vision and driven to succeed. And they may be about to quit your organization.

The Outcome: These employees are the most likely to become exhausted, burn out, or experience health events. Many times, they leave the company out of frustration because they cannot make the impact they hope to make. They realize they’re constantly going to be fighting organizational hurdles: silo walls, lack of communication, lack of clear strategy and process. They become exhausted, disenfranchised, cynical, or sometimes your loudest complainer.

We often see this issue in very large organizations, and thus it is prevalent in the pharmaceutical industry. Because of the size of the company, the C-level people who are making the decisions are disconnected from the base of the organization and not incentivizing employees on cross-functional team performance toward strategic business goals. Re-orgs are the name of the game and employees are constantly trying to figure out how to get work done with changing imaginary lines of reporting. Leadership is often acting without a clear, enduring long-term strategy and employees lose faith.

What’s at Stake: People can’t get their work done because they’re spending all their time reorganizing and addressing changes from the top. The most talented, driven people leave the organization.

Additional People Pain Points

  • Continued customization leaves people in a constant state of unguided change
  • Personality-based (versus role-based) processes impact access to talent pool
  • Lack of strategic planning and role clarity de-motivates teams