GDDIF 2010 Managing Innovation In Pharma Sundgren

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Key note presentation from Global Discovery & Development Innovation Forum 2010 (March 8-9, 2010 Edinburgh, Scotland)

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GDDIF 2010 Managing Innovation In Pharma Sundgren

  1. 1. Towards a new logic for managing innovation in pharmaceutical R&D Global Discovery & Development Innovation Forum March 8-9, 2010, Edinburgh Mats Sundgren Global Clinical Development AstraZeneca Development,
  2. 2. Outline 1. Reflections from the golden years in life science innovation • Today's problem statement 2. 2 The (forgotten) precursor of innovation – organizational creativity in pharmaceutical R&D • Examples of some past cases and current drivers in life science 3. A new model to manage innovation in g pharma? • Destabilize for innovation, implications and demands of leadership and organization p g 4. Examples of on-going initiatives from AstraZeneca Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 2
  3. 3. Setting the scene The world is full of ideas and the pharmaceutical industry has seen its fair share • The golden age of the industry is gone • Between 1950 -1980 offered large R&D opportunities and unmet medical needs for the industry • Science based innovation driven where serendipity played a key role • The last 20 years, the industry has undergone radical transformation and consolidation • Some recurrent issues of today • Managing increased R&D cost and complexity • Strategic dissonance, operating metrics clash over innovation priorities and resources • Rigid business systems focusing on standardization cost standardization, & risk reduction • Obsolete research model and R&D organisational design Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 3
  4. 4. Lessons from 60 years of pharmaceutical innovation Conclusions Munos B. Nature Review Drug Discovery 2009;8 (Dec):959-68 Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh
  5. 5. Issues What makes a pharma company successful? p y How can a company secure a strategy to become more innovative without losing effectiveness? Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 5
  6. 6. The precursor of innovation Examples of some past cases and current drivers in life science
  7. 7. Why is organizational creativity important? Organisational creativity is what preceeds innovation • An innovation in the pharma industry is a product recognised after launch l h • Need at every level of the business to build, secure and reap rewards of innovation • Involves process, infrastructure, organization, leadership, business model etc. Commercialization R&D Innovation Realization Organisational creativity Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 7
  8. 8. Two views of creativity Mainstream view Alternative view Individual-centered Distributed & collective Creativity as discrete Creativity as a continuous delimiting events and connective event Creativity is outside Creativity can be control managed & leadership plays an intrinsic role Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 8
  9. 9. Systems view of creativity After Csikszentmihalyi’s DIFI (Domain I di id l Fi ld I t Aft C ik t ih l i’ (D i Individual Field Interaction) M d l ti ) Model Culture Domains ranging to football teams, music, science disciplines to organisations Symbol system y y Has its H it own internal ‘ i i t l ‘given knowledge’, l i k l d ’ logic, rules, pattern of development, etc. Domain Selects Transmits Novelty Information Organisational creativity Individual or the group that produces the Field Individuals Individual novelty in a domain Must respond to this logic Stimulates Generic pool of Social organization organisation Novelty of Domain a Domain personal experiences Gatekeepers, managers, experts, peers stakeholders, etc. Decide what is creative or not Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 9
  10. 10. Systems view of creativity in AZ context • Research study in AZ (2001) • Explored projects in former ICI and Astra from an organisational creativity perspective • Where creativity can be seen as an emergent property within two company cultures that is shaped by multiple forces, including – but not limited to – contributions of the individual f th i di id l • Focused on seven projects within the two companies during 1975 – 1985 Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 10
  11. 11. Systems view of creativity in AZ context (7 projects 1975-85) 1975- Key aspects: Flexibility, core competence & endurance Domain (At company level) Hässle & ICI, Alderly Selects Transmits Novelty Information Organisational Individuals Field creativity & Teams (Line & Project (communities of organisation) practice) Stimulates Novelty Key aspects: Key aspects: Scientific champions, Swift decisions, idle time pathfinders & intrinsic & open climate motivation Ref. Sundgren, M. & Styhre, A. (2003) Creativity a volatile key of success: Creativity in new drug development, Creativity and Innovation Management, 12 (3): 145-161. Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 11
  12. 12. 6 Drivers of organisational creativity Based on AZ research
  13. 13. #1 Balance intrinsic & extrinsic motivation The intrinsic motivation principle of creativity suggests that people will be most creative when they are primarily intrinsically motivated • It is the engagement to work/science because it is interesting, involving, exciting interesting involving exciting, satisfying, or personally challenging without obvious external incentives • Need to secure the balance since there is a risk of only being concerned by extrinsic motivation • E.g. the traditional way of evaluating & rewarding • Crucial driver of organisational creativity & science progress • Or as Robert Sternberg put it “creativity may not only require motivation, but also generate it ” Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 13
  14. 14. #2 Promote informal networks One important answer of the question where is creativity • Interaction, communication, social contacts, and information exchanges that occur outside an employee’s ordinary line and project organisation • Answers partly the question were is Perception of creative action in P ti f ti ti i Networks vs. creativity 70 Project meetings Satisfaction score % 61 59 60 • Important translators in different 50 interfaces of knowledge 40 29 30 26 • Get ideas rolling between projects and 20 different functions 10 0 • Alternative arena for communicating Networks Project meetings ideas IM&KM Survey in AZ R&D (N= 504 & 975) 2004 (Mean, N=504) 2007 (Mean, N=975) • Is primarily driven by intrinsic motivation p y y Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 14
  15. 15. #3 Enhance information sharing A successful transfer of corporate knowledge is the backbone of organisational creativity • Today, a llarge amount of iinformation and d t f f ti d knowledge sharing reside in silos - the very fuel for creativity is that individuals, g y , groups, p, projects have access to maximum information • To enable new modes of thinking and association f i i i i patterns by reusing the organisation’s entire information capital • Often the “logistics of information” including ownership, values and political aspects poses a real problem of information sharing • Important link to informal networks Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 15
  16. 16. #4 Exploit intuition as an organisational resource What defies the day-to-day vocabulary is referred to as intuition; radical thinking • Broad competence together with extensive experience • Ability to apply scientific knowledge and to see consequences of various experiments before formal proof is acquired • Play an intrinsic part of the creative process in drug development • Whil intuition iis not capable of establishing it lf While i t iti t bl f t bli hi itself as a legitimate resource in organisations because p g g of its place outside of language and knowledge g transfer Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 16
  17. 17. #4 Exploit intuition as an organisational resource “Yes, especially on the discovery side, it is like walking in a labyrinth, you face many decision points and the thing is not to jump in the wrong di direction t ti too many ti times. The first thing you need is luck, and then it is the other, what people call intuition … And then there is the question: what is intuition? Intuition is probably j p y just that, of having a very incomplete, a very g y p y fragmentary basis and of being able, despite only having fragments, to see a pattern that leads your decision in a certain direction” (Arvid Carlsson, Nobel laureate in medicine) Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 17
  18. 18. #5 Secure political entreprenurship The creative process in organisations requires understanding, patience, and an awareness of organisational politics • Political entrepreneurship is not aimed at gaining individual power, • but it requires the ability to operate in an organisation combining organisation, skills with enabling activities such as intervention in political processes • On a practical level political entrepreneurship may involve: • Managing political relationships for ensuring the legitimacy of new ideas • Increasing the possibility to get a fair evaluation of creative ideas • Skills Skill iin rational persuasion and b i ti l i d being capable of advocating h /hi bl f d ti her/his ideas within a field of competing choices and objectives characterised by scarce resources • Enhancing the creative output g p Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 18
  19. 19. #6 Enhance leadership capabilities Control comes from the Latin “contra rotulus”, which means against what is rolling; one has to understand that if R&D is to develop new ideas and solutions and get them rolling • Need to revise & adapt traditional management training for R&D environment to include g understanding of organisational creativity dynamics • Leadership training for organisational creativity deals with: • Promoting a balance between intrinsic and extrinsic motivation • Understanding the dynamics between daily operations and innovation • Understanding and seeking possibilities, handle ambiguities and paradoxes, • Ability to generate discussions and concrete action to support organisational creativity • Ability to engage & inspire Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 19
  20. 20. Destabilise for a more innovative company? New governance model for innovation
  21. 21. Stabilisers • Stabilisers are needed in all organisations to ensure uniformity, reliability, and predictability y, y, p y • Stabilisers can be seen as established fixed repertoires of behaviour programes over time, and many grow too rigid and insensitive to environmental changes • Reduces slack; reduces the opportunity to make unplanned activities • Filter away conflicts ambiguities overlaps and uncertainty; conflicts, ambiguities, overlaps, • They suppress many relevant change signals; and kill initiatives to act on early warnings Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 21
  22. 22. Destabilisers • Destabilisers can be seen as an umbrella term of activities, factors, phenomena that in different ways p y challenge the conventional way of doing things in an organisation • Destabilisers are dynamic, and catalysts for change, organisational structure, behavior, abilities, or technologies etc etc. • Represent new p p practices & radical thinking, g • To see the destabilisation as chaos is misleading, • what is needed is to create space and support for activities that stimulate creative action Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 22
  23. 23. Organisational creativity – a syntethes of both dimensions Stabilisers Destabilisers (static, ( t ti predictable) di t bl ) (dynamic, unpredictable) (d i di t bl ) Contious, stepwise change Radical change Ref. Sundgren, M. & Styhre, A. (2005) Managing Creativity in Organizations (Palgrave) Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 23
  24. 24. One Illustration Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 24
  25. 25. Implications for leadership • Balance between stabilisation & destabilisation is achieved through effective communication and dialogue on the vision & objectives • Become more open to innovation, change and swiftly innovation contribute to the revision of the governance mechanisms • Capacity to support both polarities & create dynamic balance between the two dimensions • Requires a leadership that is characterised by: • understanding of business & science, • understanding of organisational creativity & innovation, • engagement & courage, • nurture intrinsic motivation Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 25
  26. 26. Manage the paradox? • Cost efficiency, lean processes and control are necessary,y, • but on the other hand, they are also a threat to innovation and change • The real challenge is to create an organisation that can constantly "be on its toes“; in full be toes ; readiness to innovate • Managing organisational creativity is about being able to destabilise an organisation “in the right way” to make change possible and secure way innovation Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 26
  27. 27. Some organisational types Destabilising D Stabilising Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 27
  28. 28. The challenge of not becoming rigid • Organisational creativity must continuously be maintained & nurtured • Daily management of organisations, consciously, or unconsciously, choose the lean option, namely to focus on short-term rationalisation • This may create too rigid bodies; in short it becomes “over y g stabilised” • Destabilisation is change dynamics • Reflect on factors for stabilisation and destabilisation; what it mean and what it does • The goal is NOT to “rock the boat but to identify the right rock boat” path of activities • and be able to handle both dimensions at the same time Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 28
  29. 29. Translating the model into practice
  30. 30. Examples of actions (i.e. destabilising the current ways of working) Examples of low level de-stabilisers de- • Put innovation on the agenda • Engagement from the top to start a dialogue in the organisation • Create a shared language and understanding • New leadership p • Introduce/revise understanding of innovation/creativity in leadership training • Practices/Infrastructure • Improve information & knowledge sharing • Support networking • Identify appropriate de-stabilisers • Revising performance measures in the organisation (e.g. local alt. KPIs) • Skills development • Improve creative action skills in teams/individuals • Combine skills training with in context/@site problems • Secure time for regularly meetings, Think tanks settings, facilitators • fi Evaluate benefits Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 30
  31. 31. Examples of actions (i.e. destabilising the business model) Examples of high level de-stabilisers de- • Organisational design • Reduce complexity • Simplify decision making • Business model • Revise strategy, services & products (drugs & device, managing health in partnerships) • Revise R&D model • New models for bridging connections for innovation and adaptation to open innovation • Collaboration • IPR regulated P i t P bli P t l t d Private Public Partnerships with hi ith precompetitive focus (e.g. IMI) • Infrastructure, Skills & Technology • Technology in-sourcing in sourcing • Information interoperability & new approaches of transparency in communicating and sharing information & data • Redefining Knowledge Management Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 31
  32. 32. Examples of on-going initiatives from AstraZeneca
  33. 33. The Innovation Project in AZ R&D • The project was initiated in 2009 to ensure that AZ R&D can rise to the challenge of fulfilling AstraZeneca’s core mission in the next years to come • The project is running over 4 years (2009- 2013) with a core project team of 15 persons representing all key areas in R&D • Analysis from culture assessment in Discovery and Development, and interviews with stakeholders • Developed framework for innovation and recommendations for change • 2010 - starting to communicate and g implement signature actions for supporting innovation in AZ R&D Source: The Innovation Project in AZ R&D (2010) Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 33
  34. 34. Courageous innovation . . . . . . What will it take? Source: Sundgren | GlobalProject in and Development Innovation Forum 2010 | 8-9 March, Edinburgh Mats The Innovation Discovery AZ R&D (2010)
  35. 35. Opportunities of moving forward for change to embed a culture of “courageous innovation” Aligned metrics Ali d ti Risk Ri k and rewards taking Inspiring Courageous Collaboration leadership conversation Source: The Innovation Project in AZ R&D (2010) Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh
  36. 36. Framework for Innovation in AZ Behaviours and science that ignite the passion of our people Liberate the Potential Empowered decision Learning from Transformation in value & making by experience to people who innovation g generate know how to business value Principles deliver benefits Learning Organisation not Rules to patients Source: The Innovation Project in R&D (2010) Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh
  37. 37. We need to leverage our strengths and transform our culture Strengths to build on Focus for future culture growth ▪ Dedicated, passionate and loyal: ▪ Courageous leadership - Fostering People are committed t AZ, its success P l itt d to AZ it leaders who inspire confidence i th i l d h i i fid in their and the purpose of finding medicines for staff through trust, coaching and patients continuous development ▪ Hard working and execution- ▪ Innovation - Creating innovative ways focussed: People are driven to meet of working, being open to challenge milestones and new ideas, with the knowledge that ▪ Process-orientation: Processes have we are helping to treat diseases, more brought structure and discipline and than simply discovering and developing productivity measures have increased medicines ▪ Science-driven: People are passionate ▪ Collaboration - Inspiring and about science and rigorous in their work connecting people, who actively collaborate across traditional ▪ Caring for people: R&D is a good place boundaries to share knowledge and to work with an emphasis on valuing expertise to the benefit of our people customers Source: The Innovation Project in AZ R&D (2010)
  38. 38. Organisations, large or small, who strive for innovation - is like a FRENCH DRESSING, they must be able to accommodate sweet and salt, water and oil; at th same ti t d il t the time Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 38

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