Managing Change at GlaxoSmithKlinePURPOSE:This change management report is aimed to reflect the practice of the company Gl...
the second curve through its initial floundering before the first curve declines. But it was the experience andmanagement ...
The change situation of the R&D department during the post-integration period at GSK can be seen astransformational as it ...
Year          PDI     Consumer expenditure Savings ratio Interest                          The            UK              ...
The health of economy is a vital influence on the extent of discretionary buying and how much is          spent on necessi...
globe. The existence of price control has limited the revenues that the research-based companies         can make from the...
This shows that the change process has an effect on leadership, people, resources and process, which will alsoimpact on th...
Therefore according to this curve, GSK needed an approach that allows a smooth transition from denial toacceptance in a sh...
There has been a great diversity among the definitions of corporate culture, but the most popular is that it is a mixof va...
The model shows the quantification of external orientation i.e. market and orientation of internal aspects thatincludes le...
GSK has adopted a four step approach towards the initiation of cultural change. This change process has beenslightly modif...
a major driver of change in many organizations worldwide. It can be observed that these changes often create asense of urg...
Furthermore, the                     Scientists                              Financial & Territorial                      ...
the merger of the companies. This statement really captures the spirit and intentions of the organization. Butcritics sugg...
Proportional support = 15/28 = 54%The result shows a support of more than 50% for the change therefore the strategies unde...
objectives need to be setup. Then listing the actions needed to bring about these objectives should be done.Finally settin...
EVALUATION:The content, context and process (Pettigrew 1985) of the change in the R&D department of GSK during the postint...
the help of relevant theories the change management at GSK of division of R&D department into CEDDs can beused as benchmar...
Handy, C. (1993), " Understanding Organizations " 4th Ed., Penguin BooksHandy, C. (1999), " Understanding Organizations " ...
Watmore, J., (1999), "Releasing Creativity", Kogan Page Ltd.
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Managing change at glaxo smithkline

  1. 1. Managing Change at GlaxoSmithKlinePURPOSE:This change management report is aimed to reflect the practice of the company GlaxoSmithKline (GSK) to copeup with the changing and unstable environment and also to make a recommendation in order to bridge the gapbetween their practice and the theory. In order to achieve the objectives of this report the change situation thathas been chosen is the cultural change and post merger integration of the R&D department of the company in2000.It has been depicted in the literature that during the process an organization is experiencing a change, how theorganization finds, decides and forms its figures are the most important aspects for its future. As complexitytheory stresses unknowability and the importance of continuous learning activities (Rosenhead, 2001), the abilityto change means a more tacit, prepositional concept that lies in the bottom line, because explicit skills are afterall merely snapshots of what an organization currently has. Needless to say, this ability has relation to anorganizations sustainability. As deGeus argued, the 27 long lived companies had a commonality which was acomplete transformation in their business portfolio (Hopkins, 1998). Thus the importance of change and changemanagement in todays turbulent business environment has escalated. /p>COMPANY BACKGROUND:GlaxoSmithKline (GSK) is among the top 20 FT Global 500 companies and among the top 5 pharmaceuticalcompanies in the world. GSK develops, manufactures and markets pharmaceuticals, vaccines, over-the-counter(OTC) medicines and health-related consumer products (Datamonitor, 2005). The company primarily operates in116 countries and its marketing is done in over 125 countries. It is headquartered in Brentford, UK andemployees about 100,000 people (GSK, 2004).GSKs history goes as far back as 1859 when Beecham opened the worlds first factory built solely for makingmedicines at St Helens in England. Since that time the group has passed through many phases, but the turningpoint came during the merger of GlaxoWellcome and SmithKline Beecham in 2000, it had also seen a merger ofGlaxo and Wellcome in 1995 (Glaxo, 1998). There was a major impact on the culture, structure, stakeholders andstrategy of the company due to this merger.Innovation is at the heart of GSKs aims and the company promotes this through its unique culture. The objectiveof the company as described by its Annual Report 2004 is to become the undisputable leader in thepharmaceutical and consumer health industry (Glaxo, 2004).CHANGE SITUATION:The merger of 2000 can be seen as the proper use of sigmoid curve (Handy, 1994), as the company started anew curve before the first one declined. Both the legacy companies had the time, resources and energy to get
  2. 2. the second curve through its initial floundering before the first curve declines. But it was the experience andmanagement capabilities of both the companies that lead them through a successful change managementprogram. This merger can be illustrated as follows:During the process of change management the company emphasized upon creativity and innovation (Emerald,2004), it realized that without these the company was at risk from the highly competitive pharmaceutical industrywith an increase in generic manufacturers. Thus with many patent expiries due soon and with empty pipelines,the start of new curve was an issue.Considering these external stimuli the CEO of the company Jean-Pierre Garnier tried to reconcile the concepts ofbeing big and think small by dividing the R&D department into seven " centers of excellence for drug discovery "(hereafter CEDD) (Financial Times: April 2, 2001). This change was based on the success of biotechnologycompanies, where independent small teams were working. The change can be categorized as plannedtransformational and can be represented on the following diagram:
  3. 3. The change situation of the R&D department during the post-integration period at GSK can be seen astransformational as it fulfills the five key indicators of transforming change given by Ashburner et al. (1996: p. 6).The announced change influenced the culture prevailing at the department, changed the interaction of operationsand R&D department, formed new leaders within each CEDDs, changed roles of individuals and teams.Furthermore, in this change the management role was proactive therefore GSK being the center of R&D can beseen as in the planned transformational stage, during the post integration period of the merger. The externalenvironment in which the company was operating at the time of the merger can be analyzed in detail by using thePESTEL analysis.PESTEL ANALYSIS:Politics There has been widespread investigation into the likely impact of liberation of international trade by World Trade Organization (WTO) for China. In the early 2005 China announced the end of some of the remaining quota systems prevailing on different segments. This has facilitated the process of globalization for ethical drug manufacturers like GSK and also opened up a market of 1.29 billion people. There are growing concerns of parallel trading in the Europe and its effects on the revenues of the pharmaceutical companies. With the accession of the ten Eastern European and Baltic states to the EU in 2004, large distribution companies with pan-European operations have emerged as distributors and have started to source products from the lowest point of supply in Europe through the medium of parallel imports.Econimical t has been estimated that in 2004 the global pharmaceutical market was worth £ 275 billion, with projections showing an annual global sales growth of 6% over the following five years (Datamonitor, 2005). Drawing upon Pollack (2005), it can be stated that the majority of the sales in the industry originate from the Triad countries i.e. US, EU and Japan. The health of economy is a vital influence on the extent of discretionary buying and how much is spent on necessity purchases. The trends in personal disposable income has seen steady rise of 14% in the period of 2002-2005 (HM Treasury, 2005). This growth has been assisted by low unemployment, low inflation and falling interest rates for much of the period. The following graph and the table of figures have been made with the help of data taken from ONS (2005).
  4. 4. Year PDI Consumer expenditure Savings ratio Interest The UK business cycle (HM £bn £bn % % Treasury, 2005) shows that the current cycle 2002 703 649 5.3 4 started in the early 1999; peaked in 2001 and then saw its lowest 2003 721 664 5.5 3.7 point in 2003. It can also be inferred from 2004 752 697 6.6 4.4 the cycle diagram provided below that2005 (est) 777 720 6.9 4.4 long term government economic policies and stable inflation rates2006 (fore) 801 742 6.9 4.5 have made these cycles less pronounced then before. This is good news for all the businesses in UK as these cycles have less impact on them now then before. The diagram of the UK business cycle adopted from HM Treasury Report 2005 is provided as follows:
  5. 5. The health of economy is a vital influence on the extent of discretionary buying and how much is spent on necessity purchases. The trends in personal disposable income has seen steady rise of 14% in the period of 2002-2005 (HM Treasury, 2005). This growth has been assisted by low unemployment, low inflation and falling interest rates for much of the period. The following graph and the table of figures have been made with the help of data taken from ONS (2005).Social: National Health Service (NHS) has projected that healthcare spending growth will remain fairly constant till 2014, growing at the rate of 7% every year (NHS, 2005). This table growth in the healthcare spending can be seen has an opportunity for ethical drug manufacturers like GSK. The number of people aged 65 and older has more than tripled since 1950s to reach 420 million worldwide. The UK Census and National institute on Aging have predicted that by 2030, one in every 5 UK citizens will be aged 65 or above. This prediction is based on the analysis showing that the fastest growth between 2002 and 2005 is among those aged 55-64, representing the Baby Boom generation (Herald, 2005).Technological: Soaring energy costs are driving the price of packaging materials. Chemical companies across the globe have been forced to increase the price of polyethylene. This is the material that is used in the manufacturing of plastic sheets and PET that are used in medical packaging.Environmental: There has been a growing concern on the issue of animal testing for the research-based pharmaceuticals. The companies have been using animals to test new molecules and their reactions before introducing them into clinical trials for humans. The pressure from the animal right activists has increased in the last couple of months on the companies.Legislation: In 1984 the Drug Price Competition and Patent Term Restoration Act (also known as Hatch-Waxman Act) created an abbreviated approval process for generic prescription drugs in the US and the results were felt throughout the globe. The sales of generic drugs have increased dramatically since then. Today, the generic versions of all the top selling drugs are available soon after their patent expires. In addition to the early entry of the generic products the prices of research-based pharmaceutical companies is faced by price controls imposed by governments and health care providers around the
  6. 6. globe. The existence of price control has limited the revenues that the research-based companies can make from their patented products. There are stringent government regulations that govern the entry to pharmaceutical industry. The licensing requirements, clinical trials regulations, product efficacy and safety regulations have contributed to strengthen the entry barriers for new entrants in the research-based and OTC segments of the pharmaceutical industry. It has been estimated that out of 5000 – 10000 molecules that are screened in the labs only one makes it to the market due to these government regulations (Debra &Sivakumar, 2004).Thus it can be concluded that the increasing costs, stringent laws, increasing generic competition and decreasinginnovation are the prime reasons for the post merger integration changes in the R&D department by themanagement of GSK. This has been coupled by the core competency of strong R&D departments in terms ofperformance and optimized results of the two legacy companies.THE CHANGE PROCESS:GSK uses European Foundation for Quality Management (Excellence Model) to measure its performance(Simmons, 2003). The model has been used by the companies to gauge their performance in different aspects ofchange management. This framework provides a benchmark against the best practice not only in the industry butalso across different industries. Therefore for the purpose of this report the model can be used to show how theunder consideration change has affected the components of the model and furthermore, using it as the basis ofthis change management audit report. The impact of change on the organization and in particular on the R&Ddepartment is considered to be of competitive advantage for GlaxoSmithKline and can be represented on EFQMby using arrows in the following way:
  7. 7. This shows that the change process has an effect on leadership, people, resources and process, which will alsoimpact on the results of customers and therefore key performance indicators. Leadership style used in eachCEDD and the overall leadership style during this change has been under pressure so that it is aligned withenhancing creativity (Financial Times, 2005). The leadership styles needed to be changed from autocratic andtask oriented towards democratic and people oriented. It can be concluded from the press articles about thechange that scientists believed that the department was having a power culture (Handy, 1999) before thechanges towards CEDDs. But as the department was divided into a grid like structure with different teamsinteracting within each other the resulting culture was a task culture (Handy, 1999).The motivation of the people was very low due to many changes occurring in a very short duration of time.Employees first saw the merger of Galxo and Wellcome in 1995 and then of GlaxoSmithKline in 2000. Scientistsworking at the R&D development have reported that these mergers were constraining forces in their work as theyhad budgeting issues during the pre-merger, due diligence and post-merger periods. Their motivation levelsbecame very low after the announcement for the change into CEDDs (Financial Times, 2003). They had animpression that they were being treated like sales department by raising competition within themselves (FinancialTimes, Oct 24, 2002). This drop in the motivation of the employees can be seen as what is known as DenialStage in the Kubler-Ross Transition model. This model along with the emotional states of the undergoing staff isillustrated as follows:
  8. 8. Therefore according to this curve, GSK needed an approach that allows a smooth transition from denial toacceptance in a short time frame. The processes at GSK also needed to be changed to cater for this new CEDDsbased R&D department as there could be possible knowledge management issues among the centers and alsothey had to fight for their budgeting needs. These issues in the enablers part of the EFQM would lead to theGSKs unsatisfied employees and customers that in the long term will project in weak pipeline which is one of thekey performance indicator for GSK.Although the action taken by the management to create the CEDDs can be seen as an abrupt one, but it took thepath of Organizational Development to ingrain this change into the culture of the organization.CHANGE AND ORGANIZATIONAL DEVELOPMENT THEORY:In order to harness the improvements from this change, GSK needed to use the organizational developmentaltheories to manage the smooth transitional period. The change from one R&D department to seven independentteam oriented CEDDs, can be represented in the following diagram:This structural change according to Handy (1993) can only be possible if it is supported by a cultural change i.e.a transformation of the culture from role to task culture. Thus the company was faced with yet another problem ofchanging the culture of the department in order to make the CEDDs work effectively. The nature of this taskrequired slow transformation (Gibb, 1998), as corporate culture is complex and intangible.
  9. 9. There has been a great diversity among the definitions of corporate culture, but the most popular is that it is a mixof values, beliefs, assumptions and the history of the company combined together (Andrew, 1995). There aremany tools that show this intangible characteristic of an organization on a map. One of the most admired one isthe " Gottarna Cultural Map " (Handy, 1993 &Chorn, 2004). According to this map the culture of an organizationcan be shown as I (Integration), D (Development), A (Administration) and P (Performance) logics or somecombination of this. Thus the cultural change at GSK can be represented on the following axis:The pre and post merger positions of GSK culture has been mentioned in the above cultural map. It shows thatbefore the change in the R&D department the prevailing culture can be seen as a Power Culture and it wasmore oriented towards the development (D) side. Therefore the department was lacking a competitiveenvironment. The change in the structure of the department can be seen as a strategic change in the culturetowards the performance (P) side, which keeps an eye on the competition and uses creativity and innovationunder the limits of practicality.This cultural change in turn required a strategic alignment of the external and internal players of the department.The most important external player can be seen as the market environment, while the internal players can beseen as strategy, culture and leadership style. According to the best fit approach (Handy, 1993) and strategicalignment (Chorn, 2004) approach, these external and internal characteristics need to be aligned. Strategicalignment for GSK is shown as follows:
  10. 10. The model shows the quantification of external orientation i.e. market and orientation of internal aspects thatincludes leadership, culture and strategy. According to Chorn (2004) the fit between the internal and externalenvironment is the key towards a sustained competitive advantage and thus adds value for all the stakeholders ofthe company. The alignment shows how change in strategy has affected the culture towards the orientation ofmarket, strategy and leadership style. Although the basic aim of the strategic change is on the structural aspectsof the R&D department but the impact can be seen on the culture of the department as well. The diagram showsthat the strategy has been more focused towards performance after the merger. Therefore in order to enhancecreativity and innovation at GSK, the shift of strategy was the viable option.THE PROCESS OF CULTURAL CHANGE:The challenge was to motivate people and have contingency plans for this cultural change at GSKs R&Ddepartment. But what exactly does management work on to change a departments culture? Should managementbe focused on strategy, building teams, empowering people, introduce tools and processes or restructure?(Atkinson, 2005) The possibilities are infinite in an organization; the difficult part is deciding which interventionsare likely to have the most impact. The answers are different for every organization.
  11. 11. GSK has adopted a four step approach towards the initiation of cultural change. This change process has beenslightly modified from the force field analysis proposed by (Lewin 1951) to fit the change situation of GSK. Thesteps that were undertaken by the company can be summarized in the form of following diagram:These four steps cover the following four points: 1. Make sure that the R&D department and people understand the pressure of change – why do we need to change? 2. Develop and share a clear vision about where the organization and department is headed – where are we going? 3. Put in place the individual, departmental and organizational capabilities for change – what do we need to make the change? 4. Have a plan of action that outlines what has to be done to get it all started – what do we have to do tomorrow when we come to work?BUILD PRESSURE FOR CHANGE:The pressure of change is essential for the effectiveness of a change program (Chorn, 2004 & Atkinson, 1996).Therefore, in order to take the initiative of cultural change at GSK a sense of urgency was created to divide theR&D department into 7 CEDDs. Without it, the initiative seems to sink and other priorities take precedence andorganizational behavior does not change.The re-alignment and change program of GSKs R&D department into CEDDs has arisen after the analysis of thecompanys position and the competitive environment. It can be seen that for a very long period of time thecompany was unable to produce any new block-buster molecule and its patents were expiring one after the other,making it hard to compete with generic manufacturers (Chemist, 2005). Management and staff need to realizethat they face threats and opportunities; this often creates sense of urgency.A number of organizations have faced major shifts in their operating environment, such as deregulations or newcompetitor entering the market. Industry deregulations, for example, in utilities, banking and air travel have been
  12. 12. a major driver of change in many organizations worldwide. It can be observed that these changes often create asense of urgency.In order to define the problem and thus create a sense of urgency a stakeholder mapping was done by thecompany. The company defined the core and peripheral stakeholders for this change and grouped them togetherto create a strategy for each group. The definition of these groups helped the company in brining about thechange successfully. Different stakeholders for the change can be drawn on the following diagram:The diagram shows that the first step showed scientists and shareholders to be the core stakeholders in thischange and therefore the sense of urgency was induced into these with the help of a clear shared vision.ESTABLISH A CLEAR, SHARED VISION:This is similar to the second step of the forced field analysis (Lewis, 1951). If there is no clear, shared vision thechange begins quickly but then dies out because people do not know what they are aiming for (Atkinson, 2005).Therefore it is the responsibility of the leader to not just communicate this vision but also make employees seethe practical example of it. In the case of GSK, though the CEO Jean-Pierre Garnier communicated the vision ofcompetitiveness and innovation with practicality to its managers but they were unable to communicate thismessage across their employees. The managers were actually resistant towards the change as it makes theirjobs insecure.In order to make a list of pushing forces (Lewis, 1951), the company identified the possible impacts on each of itsstakeholders and devised a strategy to tackle these impacts smoothly. The stakeholders and the impactsconsidered by the company can be summarized with the help of following table: Key Stakeholders Impacts
  13. 13. Furthermore, the Scientists Financial & Territorial relationship of GSK with its key Shareholders Financial stakeholders was used to substantiate the Doctors & Consumers Social strategy that was adopted for each Distributors Financial group of stakeholders. Regulators Social & Environmental This can be summarized by using Power/ Pressure Groups Social & Environmental Interest Grid for stakeholderprioritization. The aim of each strategy can be seen with the help of this depiction:Therefore the company used a clear and shared vision that acted as a compass that provides ongoing directionto the change journey. Drawing upon Chorn (2004) the vision needs to be clear and widely shared throughout theorganization. In the case of GSK who wants to be more performance oriented, must ensure that this vision iswidely held and understood. Thus the actual behavior and attitude required by the scientists must be spelled outin explicit ways.The mission statement of GSK according to its latest annual report is to become the undisputable leader in thepharmaceutical and consumer health industry (Glaxo, 2004). This was the new mission statement in 2000 after
  14. 14. the merger of the companies. This statement really captures the spirit and intentions of the organization. Butcritics suggest that the mission statements usually are not effective in mobilizing support for the change.ENSURE THAT THE DEPARTMENT HAS THE CAPACITY FOR CHANGE:It was established by the senior management of the company that if the department and the people do not havethe necessary capacity for the change then this change will create anxiety and frustration. It was realized thatpeople were though momentarily in the denial phase they still want to change but do not have wherewithal to doso.In order to access the attitudes of the stakeholders and their power towards the change, they can be scoredusing the Ruchelmans Prince System (1985) as follows: Issue Power (1 Salience (1 Total support by Stakeholder position (-3 to to 3) to 3) stakeholder +3) Scientists -2 x 2 x 3 = -12 Shareholders +2 x 2 x 2 = +8 Doctors & +1 x 1 x 1 = +1 Consumers Distributors 0 x 2 x 1 = (2) Regulators +1 x 3 x 1 = +3 Pressure +2 x 1 x 1 = +2 GroupsThe calculations can be seen as: Score of all the stakeholders supporting the issue = 14 Absolute values of stakeholders opposing the issue = 12 Scores of stakeholders with zero issue position = 2 Total units of support (for and against) in the system = 28 Units of support in favour of the issue = 14 + (assumed) half of 2 = 15.
  15. 15. Proportional support = 15/28 = 54%The result shows a support of more than 50% for the change therefore the strategies undertaken by the companyfor each stakeholder were valid and provided the capacity for change undertaken by the company.Providing the capacity to change in an organization must be achieved at both the individual and group level. Asthe new system of CEDDs would have autonomous teams therefore to emphasis at the group level is veryimportant. For individuals, we need to recognize the ladder that produces results (Atkinson, 2005) i.e.:This shows that the desired results should be clearly understood before it can be specified what behaviors arerequired. Once the behaviors are identified, the change process can address the development of the requiredcompetencies.At the departmental level, it needs to create the appropriate capabilities for the department to change. Thismeans two things: 1. Ensure that the designed culture is appropriate for the department’s structure. In particular to make changes in: o Autonomy/ Job design to allow scientists to do what needs to be done o Control to inspect and control the appropriate behaviors o Performance Rewards to expect and reward the appropriate behaviors o Structure to reflect the outcome needed to achieve 2. Allow the department and CEDDs some slack during the ‘changeover’ period. Generally it is difficult to maintain the same levels of efficiency when making changes to one’s routine.DETERMINE ACTIONABLE FIRST STEPS:GSK has provided explicit guidelines for people to make the important first steps. It is obvious from the literature(Andrew, 1995) that the effectiveness of the change program depends upon the first steps taken. If these stepsare taken positively by the employees they can be the first signs of success. Drawing upon Chorn (2004) thatchange attempts can fail because no one knows where to start. Having articulated a vision, it is needed to breakdown the vision into its separate parts. SMART: specific, measurable, achievable, rational and time bound
  16. 16. objectives need to be setup. Then listing the actions needed to bring about these objectives should be done.Finally setting performance measures needs to be taken care of. This stepwise approach ensures that milestonesare reached in time and the transformation takes place in a time bound framework.CONSTRAINTS:The transformation of the R&D department from a single unit towards seven smaller, independent CEDDs andthe cultural change that will accompany it can be seen as people oriented and also as ignoring the task needs.As the teams will be working independently and there would be a competition between the teams therefore thestate that can establish with over emphasis on teams can be illustrated with the help of John Adair’s circles(Handy, 1993) bellow:Therefore in order to keep the team focused on the task, the equilibrium between team, task and individual needsshould be catered. This can be done by having a democratic leadership style within each CEDDs. As the needsfor creativity is high, confidence in individual scientists is also high and the value system adopted due to thechange in culture is also supportive to innovation therefore the leadership style that best suits to overcome thisconstraint is flexible and democratic.
  17. 17. EVALUATION:The content, context and process (Pettigrew 1985) of the change in the R&D department of GSK during the postintegration period of its merger can be evaluated by analyzing the Effectiveness, Efficiency, Accessibility,Appropriateness and Economy of this change.The performance of the R&D department can be gauged by a comparative analysis of the company’s pipeline,operation efficiency and costs before and after these changes. Drawing upon the statement of the then appointedCEO Jean-Pierre Garnier who announced the basic objective of the division of R&D department into CEDDs wasto increase the productivity of the department as the company had an empty pipeline at the time of merger(Emerald, 2004). As the discovery of the molecules is a lengthy process therefore after 4 years of these changesthe results started to pour in. In 2005, GSK has been estimated to have one of the largest and most promisingpipelines in the industry, with 140 projects in clinical developments, including 88 new chemical entities, 32product line extensions and 20 vaccines (Datamonitor, 2005). This shows the effectiveness and efficiency of thechange under consideration.The company has one of the deepest reported early stage pipelines in the industry, supported by extensive in-licensing activity and probability suggest that this will generate a healthy outflow in the mid to long-term. This hasmanaged to balance its product portfolio over the last 4-5 years due to the process of drug discovery adopteddue to the change. Currently, none of the therapeutic groups accounts for more than 22% of the company’srevenue (GSK, 2004). Therefore the accessibility and appropriateness of the changes can be seen as success.The company has a strong focus on its R&D department and it has invested heavily in R&D, despite the fallencompany sales from 2002-2005 (GSK, 2004). According to Datamonitor (2005) the R&D at GSK is forecasted togenerate less than 5% of the total revenue in 2007, highlighting the weak economy of the change underconsideration. The company has spent an estimated £ 2.1 billion in the changes in the R&D department over theyears (GSK, 2004). Even though in 2004 the company witnessed the lowest turnover since 2001, the company’sR&D spending has outstripped sales growth. Between 2001 and 2004, GSK’s spending on R&D increased by3.8%. Although this continuing investment of the company in R&D is vital for the long term revenue and to createsustainable competitive advantage for the company but the change has proven uneconomical for the companyover the last 4 years.CONCLUSION:In order to sum it up, it can be concluded that the content, context and process adopted by GSK under the light ofexternal market changes during the post merger integration of the company can be seen as a good practice inthe change management arena. The PESTEL analysis shows that the need for change anticipated by themanagement was needed at that time and the evaluation strengthens this argument. The process adopted by thecompany can also be seen as one of the best practices to be used for benchmarking in the industry because thecultural aspects were spotted and dealt with during the change. Therefore in light of the discussion provided with
  18. 18. the help of relevant theories the change management at GSK of division of R&D department into CEDDs can beused as benchmark for good practice for others in and across the industry.REFERENCESAshburner, L., Ferlie, E. and Fitzgerald, L. (1996) " Organisational Transformation and Top-Down Change: thecase of the NHS " British Journal of Management 7, pp. 1-16Andrew, M. (1995), " Creating a culture of change " Hospital Material Management Quarterly, May95, Vol. 16Issue 4, p30Atkinson, P. (2005), " Managing resistance to change ", Management Services, Spring2005, Vol. 49 Issue 1,p14-19, 6pAtkinson, P. (1996), " Managing culture change: Can it ever be ethical? ", Personnel Review, 1996, Vol. 25 Issue6, p26, 15pChemist, (2005) " A Chemistry of the future " Manufacturing Chemist, Jan2005, Vol. 76 Issue 1, p34-35, 2pChorn, N. (2004), " Strategic Alignment ", RichmondDatamonitor (2005), " Company profile – GlaxoSmithKline ", Datamonitor EuropeDatamonitor (2005), " Industry profile – Pharmaceuticals (Global) ", Datamonitor EuropeDebra, M., Sivakumar, K. (2004), " Patents and product development strategies: a model of antecedents andconsequences of patent value ", European Journal of Innovation Management; Volume: 7 Issue: 1; 2004Emerald, (2004), " Innovation at GlaxoSmithKline: Is it the Safest Way " Strategic Direction, Vol. 20, No. 7, pp.16-18Financial Times (2005), " Glaxos catalyst for creativity ", Andrew Jack, Mar 18, 2005, pg. 15Financial Times (2003), " Entrepreneurship - Keeping the flame alive ", Michael Dempsey, Nov 12, 2003, pg. 13Financial Times (2002), " GlaxoSmithKlines radical program to increase the productivity of its 15,000 scientists isa test case for the entire drugs industry ", Geoff Dyer, Oct 24, 2002, pg. 19Financial Times (2001), " BigPharma sees the beauty of thinking small ", Pilling, D., Apr 2, 2001, pg. 12Gibb et al, (1998), " Toward Culturally Sensitive Theories of Culture Change ", Academy of Management Review,Oct98, Vol. 13 Issue 4, p522, 12pGlaxo, (1998), " Are you Creative? " Published by: Journal of Knowledge Management, Sept 1998Glaxo, (2004), " Annual Report 2004 – GlaxoSmithKline ", www.gsk.com [Accessed: 15th Nov, 2005]
  19. 19. Handy, C. (1993), " Understanding Organizations " 4th Ed., Penguin BooksHandy, C. (1999), " Understanding Organizations " 4th Ed. Reprint, Penguin BooksHandy, C. (1994), " The Age of Paradox ", Harvard Press, Boston, 1994Hopkins, E. (1998), " The Rise of the manufacturing town ", Sutton 1998HM Treasury (2005), " Fiscal Policy in UK ", www.hm-treasury.gov.uk [Accessed: 15th March, 06]Lewin, K. (1951), " Field Theory in Social Science ", London, HarperNHS (2005), " Annual Report NHS ", National health ServiceONS (2005), " Office of National Statistics ", www.statistics.gov.uk [Accessed: 1st March, 06]Pettigrew, A. (1985), " The Awakening Giant: Continuity and Change in ICI ", Oxford, BlackwellPollack, P. (2005), " Reasons for the Slump in New Drug Launches ", Specialty Chemicals, May2005, Vol. 25Issue 4, p14-16, 3pRuchelman, L. (1985), " A Workbook in Program Design for Public Managers ", State University of New YorkPressRosenhead, J. (2001), " Rational analysis for a problematic world revisited: problem structuring methods forcomplexity, uncertainty and conflict " 2nd ed., Wiley, c2001Simmons et al. (2003), " Performance Measurement Tools: EFQM Excellence Model ", Measuring BusinessExcellence, Vol. 7, No. 1 2003, pp. 14-29(The) Herald (2005), " Baby boom gone bust, Policies needed to tackle worryingly low birthrate ", Glasgow (UK):Nov 11, 2005. p. 21BILIOGRAPHYBuchanan &Huczynski (2004) "Organizational Behavior – An Introductory Text", Prentice HallHandy, C. (1993), "Understanding Organizations" 4th Ed., Penguin BooksHandy, C. (1994), "The Age of Paradox", Harvard Press, Boston, 1994Jeanie, D. D. (2001), "The Change Monster", Three Rivers PressLynch, R. (2003), "Corporate Strategy" 3rd Ed., FT Prentice HallRobert, A. & James, M. (2000) "Change management: a guide to effective implementation" 2nd Ed., Sage
  20. 20. Watmore, J., (1999), "Releasing Creativity", Kogan Page Ltd.

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