Developing an Appetite for Change

Is your culture correct for digital transformation? (Hint: it should be)

By Chris McNamara, Smart Industry content director

It’s often said that company culture eats strategy for breakfast. And when it comes to strategy intended to advance an organization’s evolution into Industry 4.0, pharmaceutical companies have not historically embraced the seismic cultural, talent and process shifts that digital transformation represents.

That’s holding all of us back. (But don’t feel too bad. Other industries are having their own struggles stepping into the digital future.)

So what’s the fix? For answers, we turned to Suzanne Burns, member of the global industrial, infrastructure and digital practices for Spencer Stuart. Our goal was to find out how to optimize the change needed within corporate culture to accelerate digital innovation. Is it a cultural shift? Is it a strategic shift? 

Burns responded with an all-around “yes.” 

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“The answer is both. You can have the best-laid strategy, but if your culture is not right it can derail best-laid plans,” said Burns.

Burns stressed that in order for manufacturers to be successful, they must take a different path than they have historically chosen. The culture that made them successful in the past was likely results-oriented, process-oriented, operating within a narrow discipline. And this culture persisted for good reason: to deliver stable, predictable outputs and economic performance. The common line of thinking has been: “That’s what we’re known for, so why change it?”

But even if these cultural attributes served the pharmaceutical industry well in the past, they’re often diametrically opposed to the agile, collaborative and learning-oriented attitudes embodied by leading digital organizations.

to gain long-term advantages, manufacturers must accept change as a business imperative.

“As industrial companies want to become more customer-centric, innovative and agile, they are recruiting executives from B-to-C companies to help them in those areas,” explained Burns. 

And the reverse is true where industrial companies are infusing talent in B-to-C companies to help with operating discipline and productivity improvements. 

Of course, disruption for the sake of disruption is not necessarily a good thing. But in order to gain long-term competitive advantages, manufacturers must accept change as a business imperative. “We’re witnessing that with an Amazon or Uber coming up with different business models that change the landscape,” she noted. “For a business to compete in the long-term they must have strategies that are able to address these changes straight on and, hopefully, be ahead of the curve.” 

Is that your business? Perhaps more importantly, is that where you’d like your business to be? 

A critical component is personnel. Specifically, change-agents who spearhead the (occasionally difficult) process of shifting mindsets and tactics. And it comes from top down. While digital transformation is a technology-dependent shift in business model, people are at the heart of it. Go figure.

“The signal for the necessary changes has to come from the top of the organization,” Burns said. “That executive sets the tone that ripples through an organization. But in no way is change successful without having every level in an organization embrace it along the way. You must have that buy-in throughout an organization, aligned with the strategy.”

Or, more specifically, you must have that buy-in throughout an organization that wants its digital transformation to succeed. Ultimately, you need a culture that balances the need to deliver consistent, profitable growth against the ability to absorb and capitalize on often disruptive digital innovations.

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