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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,
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
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
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
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
The precursor of innovation
Examples of some past cases and current drivers in life
                                            science
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
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
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
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
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
6 Drivers of organisational
                 creativity
            Based on AZ research
#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
#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
#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
#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
#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
#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
#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
Destabilise for a more innovative
                      company?
        New governance model for innovation
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
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
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
One Illustration




Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh
                                                                                                24
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
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
Some organisational types

Destabilising
D




                                                                        Stabilising
Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh
                                                                                                27
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
Translating the model into
                 practice
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
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
Examples of on-going initiatives
             from AstraZeneca
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
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)
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
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
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)
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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GDDIF 2010 Managing Innovation In Pharma Sundgren

  • 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. 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. 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. 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. 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. The precursor of innovation Examples of some past cases and current drivers in life science
  • 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. 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. 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. 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. 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. 6 Drivers of organisational creativity Based on AZ research
  • 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. #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. #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. #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. #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. #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. #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. Destabilise for a more innovative company? New governance model for innovation
  • 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. 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. 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. One Illustration Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 24
  • 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. 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. Some organisational types Destabilising D Stabilising Mats Sundgren | Global Discovery and Development Innovation Forum 2010 | 8-9 March, Edinburgh 27
  • 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. Translating the model into practice
  • 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. 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. Examples of on-going initiatives from AstraZeneca
  • 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. 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. 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. 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. 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. 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