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pricing reassessment will not be sufficient when what is really needed is fundamental restructuring to produce a product offering that brings new value to customers. |
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B. The Role of Leadership in Change |
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A key lesson that we can draw from these observations is how difficult discontinuous change will be for the drug industry. The cultural bedrock of a science-based organization that views itself as having been put on this planet to make medical breakthroughs will resist rational examination of alternative strategies. |
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Leadership plays three essential roles in pushing through changes that often feel like unnatural acts. One role is to continually articulate the need for change in terms of the organization's past performance and the ever-heightening competitive bar. Six year cycle times will not make the grade. Me-too therapeutic aims are not worth the investment. |
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The second role of leadership is to create a clear vision for the future of the company that is compelling, energizing, and attractive to individuals. Without a clear view of the future there is no context within which to make the decisions that have to be made today. |
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The third role, which most leaders do not recognize soon enough, is to anticipate and eliminate all of the inevitable organization responses that turn a clear strategic vision into conflict and confusions. Behaviors such as turf wars, task-force proliferation, analysis paralysis, values clash, and other types of informed resistance are inevitable and will stop any well-meaning change effort without a clear signalsuch as a public hangingthat they will not be tolerated. |
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This is a time for choice: to choose whether to stay in the drug development business (where the conditions of survival include halving the drug development time) or to compete in the cost-effectiveness war with the distribution giants and the generics providers (where the cost of survival is quartering the sales force and changing the culture of the company). Those who make the wrong choice may fail, those who fail to make any choice and try to straddle the fence with a little drug development and a mediocre distribution system, will surely fail. |
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Most major companies accept that these are the choices to be made. But who will make them best? Those whose leadership is deeply entrenched in the way the business has been for the past 30 years or those imported from other industries to take over the mantle of recently fired CEOs? One knows too much about the past, the other knows too little about it. |
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Drug development will certainly continue, of that we can be sure. That it will be done faster by fewer companies, we may be certain. The present up- |
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