Op Ex & Lean Six Sigma / Facilty Design & Management

The Good Fight: The Plight of Pharma's Middle Managers

Middle managers in pharma today have a tough, thankless job—but someone’s got to do it, and many do it well.

By Paul Thomas, Senior Editor

The Dilbert Principle, made famous by the long-running comic strip, holds that “leadership is nature's way of removing morons from the productive flow.” The Dilbert strips often feature uninspiring, less-than-competent professionals in positions of middle management, where they can “do the least harm.” TV’s The Office has hardly done anything to change this perception.

But recent research finds that the middle manager plays a critical—if not the most critical—role in ensuring organizational success. Ethan Mollick of the Wharton School of Management, for instance, maintains that middle managers have an impact “much larger than that of those individuals who are assigned innovative roles.” By “innovative” Mollick means top management, those who are expected to mold or reshape the organization.

In fact, Mollick says, good middle managers are especially critical in creative, innovative, and knowledge-intensive industries. And how better to describe pharma?

And yet, pharma’s middle managers are often viewed as Dilbertesque—inept, inexperienced, or even “frozen.” (See “Eluding the OpEx Black Hole,” Pharmaceutical Manufacturing, June 2009.)

That characterization is usually not quite apt, as our recent interviews with pharma middle managers suggest.
 
Nor is it fair, says Daniel Hoffman, president of PBRA Consultants. He believes that middle managers in pharma—from site directors to plant and lab managers to team leaders to Quality heads—are vastly underappreciated and ill-supported.

Lately. some of pharma's best middle managers have been put out to pasture. Fifty-something professionals with good skills and a broad knowledge base are looked at as expensive and expendable, he says—as a “people-as-interchangeable-parts” pervades the industry.

The Pfizer-Wyeth merger serves as a case in point—where a core group of experienced mid-level professionals was unceremoniously shown the door. During this era of mergers and acquisitions, restructurings, and wholesale layoffs, many companies are devolving into “warring camps,” Hoffman relates. This creates a situation where remaining middle managers must pick and choose their loyalties carefully.

In many cases, it’s a no-win situation. “Top management manages on the basis of quarterly earnings,” Hoffman adds. They’re focused on the short-term and, short of major scientific breakthroughs during their tenure, feel the need to restructure and let good people go. This won’t change any time soon, he says.

Precarious Position

Yet middle managers are the ones who are especially crucial during times of turmoil and change, says Bill Wilder, change management expert and director of the Life Cycle Institute. When you go through change, he says, “It's the individual that changes, not [just] the organization,” he says. “And the person that has the most influence on an individual’s desire and ability to change is their immediate manager, that middle manager.” (Here’s more of our talk with Wilder.)

Part of the problem is that good middle managers are those who make others look good. “My job is to obsolete myself,” says a Quality manager at a major biopharma facility, who asked that her name not be used. “If I go on vacation, everyone else should be able to support themselves.”

She understands the irony: “obsoleting” oneself gives off the impression that one is expendable. “But I’ve never believed in holding work to myself,” she says.

Middle managers, as their name suggests, are often caught between senior managers and subordinates. They must “manage up” and “manage down” though both of their constituencies may misinterpret their role and value.

“Middle managers' subordinates may assume that their managers know more than what is being communicated,” says Jane Chin, founder of the 9Pillars consultancy and author of “Practical Leadership for Biopharmaceutical Executives.” “This puts middle managers in a precarious position of balancing expectations” from all parties.

In addition, says Chin, pharma’s middle managers are asked to do the near-impossible—be creative and cautious at the same time. They hear, “Be careful! Don't get us in trouble!" while also, "Be creative! We're in the business of innovation!" It’s up to the middle manager, Chin says, to decipher what executives want and to “scale” these messages to their subordinates.

Managers-Once-Removed

Unfortunately, Chin says, middle managers are often an afterthought in many pharma organizations. She calls them "managers-once-removed”—critical components to success but, because they reside in the “vast midsection” of the organization, they can become invisible and taken for granted.

And they’re often the first to go during layoffs, because they “don't appear to have tangible, objective metrics attached to their ‘cost’.” It’s not surprising, then, that the middle managers Chin has observed in the past few years tend to be in “perpetual reactive mode.” (Read our full interview with Chin here, including her advice on what managers must do to stay relevant.)

Middle managers are hamstrung, says Hoffman: “Pharma has defaulted a lot of its operations management to finance. Finance wants to reduce services and people to commodities.” This is especially true in manufacturing, where recent, highly-publicized recalls can be traced to preferred-vendor, lowest-price requirements established by Purchasing departments.

“Not that I want to be the harbinger of doom,” says Chin, “but I'd add that a lot of pharma operations has defaulted to finance and legal. Finance wants to reduce services and people to commodities, and legal wants to impose additional restrictions because it's in the business of mitigating risks.”

It’s a recipe for disaster: “If you examine the organization,” she says, “you'll find that this middle layer of management are the ones who are translating and scaling corporate strategies across their individual functions, and then ensuring the appropriate execution and measurements of those strategies. You can look at troubled organizations and find strategies that have been ‘lost in translation’ as it percolates through this middle management layer.”

Indeed, a recent internal investigation by Johnson & Johnson into the many recent problems at McNeil places blame on middle managers and lower-level execs, but not senior executives. McNeil underwent massive staff cuts, hampering Manufacturing and Quality managers’ ability to oversee operations. “With reduced central oversight and tasked with implementing the Pfizer Healthcare acquisition, some McNeil employees may have lost focus and commitment to maintain quality standards,” the report said.

“With the benefit of hindsight, it appears that the restructuring may have been imperfectly executed,” the committee said, in what appears a gross understatement. Critics have viewed the report as a means to insulate senior management, and the company, from further legal liability.

“Vulnerable to Litigation”

Thus, in pharma’s troubled organizations, it may not be top management that bears the brunt of legal troubles. Pharma commentator and blogger Jim Edwards recently wrote that there is “an emerging pattern in the prosecution of white-collar criminals in the drug industry: middle managers and other underlings—the ones actually carrying out illegal schemes—are becoming more vulnerable to litigation, as their names appear frequently in the paper trails.” CEOs and other top executives, on the other hand, are becoming more insulated, “as they tend not to be the writers of incriminating emails and PowerPoint presentations.”

Here’s an example of a typical middle manager quandary, from the forementioned biopharm Quality manager, related to product lot release. In a four-week production cycle, oftentimes a problem won’t crop up until the third week. “That means you have one week to investigate thoroughly, do a good CAPA, and everything else,” she notes. “I wouldn’t hesitate to hold up a shipment, but you get a lot of hassle for that. You can’t hold it up too often, because people will start to say you’re just too slow.” The thinking goes: a recall may happen once a decade, whereas a late shipment shows up on performance metrics immediately.

She says she carries her iPhone everywhere and documents everything that happens in emails. “Everything’s in writing,” she says. “It proves that I did tell you that.” Just as importantly, she says, senior managers can get information immediately wherever they may be, and can go back and reference the correspondence at any time.

“Often, senior management is blind to the risks that are being taken at lower levels of their organizations,” says Scott Chizzo, president and chief consultant at Maxiom Group. “We need risk management frameworks to make sure they are in the loop.” (Here’s our full interview with Chizzo on how to establish such frameworks.)

Hoffman believes that the Department of Justice and other authorities will target upper management of organizations that are absent those frameworks. A case in point is the Office of Inspector General’s pressure on Forest Laboratories, in which the company has been precluded from doing business with the government (i.e., Medicare, Medicaid) while CEO Howard Solomon is still in charge.

Nevertheless, “Middle managers are really going to have to look out for themselves,” Hoffman says. “Being the good corporate water carrier will have its hazards.”

Systemic Support

The key to the middle manager’s success is often organizational support, notes Chizzo of Maxiom. “There are clearly examples where one can point to shortcomings in middle management as the root cause of a particular failure,” he says. “But I think that there are many of the failures pinned on middle management are actually the result of more systematic shortcomings of the entire management system at their company.”

Companies must consider, says Chizzo:

  • Does middle management have the right tools for making risk-based decisions?
  • Does the organization’s culture support open, cross-functional thinking or is decision-making limited to functional silos?
  • How well informed is senior management of the risk-level of decisions being made deeper in the organization?

Integrity

There are things the middle managers can do to establish their relevance and importance. “The best way to engage senior executives in a dialog is to present potential options and scenarios you've thought through,” Chin says, “and discuss the boundaries of execution for each option to come to a mutual agreement as to which ones are feasible and are both creative and cautious."

“Senior executives may not always be able or willing to sit down and ‘brainstorm’ with you as a middle manager,” she adds, “and you'll be seen as lacking creativity and proactiveness or, worse, ‘lacking leadership’ if you skip this step and go straight to senior executives with open-ended questions.”

Hoffman has a few key suggestions for pharma’s middle: Make sure senior management hears from you vocally and regularly; keep an eye on the big picture and not just short-term tactical issues; and watch how other industries are doing things—“Don’t be parochial,” he says.

Whether these strategies will make a difference, Hoffman is skeptical. “The thing that motivates senior management above all else is their own remuneration,” he says. “When you had some of the families running companies (Merck, Upjohn, etc.), they would try to balance the wealth of family with well-being of employees, customers, suppliers, and surrounding communities. To a large extent today, whoever isn’t in the boardroom is the enemy.”

In any environment, says Hoffman, pharma’s middle managers must always balance their professional integrity with the sometimes contradictory demands of the company. “How far do you go within the standards and canons of your profession versus the imperatives of your organization? That’s always a trade-off to make, and given the dynamics of the industry today, it’s that much harder to do.”

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