The document discusses the importance of innovation for business growth, especially in the context of the pharmaceutical industry, which is under pressure to adapt to changing economic conditions and competitive demands. It emphasizes that successful companies need to view innovation as a core strategy, involving all employees and not just specialized teams, while also acknowledging the need for effective leadership and collaboration in the innovation process. Furthermore, the document highlights the shifting landscape where emerging markets are becoming leaders in innovation, necessitating a broader reconsideration of traditional business models and operational boundaries.

1. June 2012
FEATURE • MULTI-INDUSTRY
by Asa Cox
T
he turmoil engulfing the global
economy has forced many industries
into reinvention in hope of discovering
new growth. Every company faces
the daily challenge of business growth; where to
find it and how to generate profits from it. Every
business leaders’ primary task should be aligning
internal resources to capitalise on new growth
opportunities quicker and better than competitors.
Meetings, management of direct reports, and
putting out fires - two thirds of executives blame
“urgent day-to-day business demands” for their
lack of time to think about growth. Talk of the
future is often confined to budget season and
infrequent board meetings.
Planning for growth typically focuses on acquiring
more customers or generating greater revenue
from existing ones, and therefore falls on the sales,
marketing and business development teams alone.
Even then, little time is given to horizons beyond
24 months when making plans for growth, which
is understandable given the uncertainty of the
future.
It’s been proposed that this uncertainty
should act as a driving force for managers
to recognize the need to put forth a greater
commitment to planning growth and
innovation. Many top companies view
innovation as a key weapon in their efforts
to seize the potential benefits available in an
economic recovery.
Do you?
“The best way to predict the future is to
invent it.”
~ Alan Kay, Computer scientist
The long term viability of your company depends
on its ability to innovate.
In the 2012 GE Innovation survey, 95% of senior
executives said they believe that innovation is the
main lever for competitiveness and is inextricably
linked to growth.Companies in the pharmaceutical
industry are feeling the pressure of competition
like never before.
To some, innovation might be considered out-of-
scope. Instead best left in the realm of research
teams, high tech firms and inventors.
To innovate:
“make changes in something established,
especially by introducing new methods,
ideas, or products that increases its value”
~ Oxford Dictionary
Grow your company in
60 MINUTESHow much time do you spend thinking on and planning the
future growth of your company?
How many minutes per day, week, month?

2. NPT | The Community of Big Thinkers
However according to this definition, the scope is
wide open for every employee to contribute to the
future success of the company. Innovation can be
and should be at the core of your growth (a.k.a.
survival) strategy.
To be a little more specific however, economists
generally define innovation in terms of:
Product: the act of bringing something new to
the market place that improves the range and
quality of products on offer: for example, the
Apple iPod is an innovation compared with the
Sony Walkman.
Process: a new way of making or delivering
goods or services: for example, going to visit the
doctor and recording that you have arrived for
your appointment by touching a screen instead
of talking to a receptionist.
“For CEOs today, it’s all about achieving
growth and efficiency through innovation.
It’s not about product innovation so much
anymore as about innovating business
models. process, culture and management.”
~ Ginni Rometty, IBM CEO
Harvard Business Review published a modified
version of the classic Ansoff digram to help companies identify
their innovation options (see Fig 2).
No time for innovation?
The contributing Monitor Group research showed a clear
inverse correlation between time invested by leading companies
in the different types of innovation and the resulting profits.
Fig. 1 - Allocating Innovation Profits
Innovation Investment Return on
Ambition Allocation Innovation
Core 70% 10%
Adjacent 20% 20%
Transformational 10% 70%
The report highlights that there is no single formula for what
type of innovation a company should focus on. There are many
variables to consider, including stage of business maturity and
competitive position. However, just thinking about classifying
innovation is a major step forward for most companies.
How does this apply to pharma?
The author proposes that the current order of the industry is
becoming obsolete.
The pharmaceutical industry is evolving; current
segments and commercial boundaries are now
blurred by the necessity to compete for less
drug budget, in new markets, for more
sophisticated consumers.
• Big Pharma companies have identified
generics as a way to use their brand equity
to unlock quick revenue in emerging
markets.
• Generic companies understand that owning
brands are a way to protect profits; so building
OTC portfolio’s make sense
• Traditional biotech’s figure that biosimilars
are a quick and simple way to utilize existing
assets and know-how
• Consumer healthcare giants are stretching
brands into diagnostics and nutritional sectors
What is the scope of today’s pharmaceutical
company? Will it actually be undervalued by
focusing on the traditional activities of its label?
The citizens of the new pharma world need to
innovate or face extinction.
GROW YOUR COMPANY IN 60 MINUTES - MULTI INDUSTRY • FEATURE
Fig. 2

3. Innovation.”
FEATURE • MULTI INDUSTRY - GROW YOUR COMPANY IN 60 MINUTES
“Every organisation needs one core competence.
~ Peter Drucker
June 2012

4. NPT | The Community of Big Thinkers
GROW YOUR COMPANY IN 60 MINUTES - MULTI INDUSTRY • FEATURE
In Pharma Industry 2.0, operational
boundaries for such companies need
to be reconsidered for an alternative
future. New adjacents needs to
be considered and those with
transformational ideas will likely see
matchless profitability.
Innovating enough?
If you are based in mature pharma
markets (historically powerful
innovation centres), the future could
look decidedly different. The same
BCG innovation survey postulates that a new world order in
innovation is taking hold, one in which rapidly developing
economies (RDEs) led by China, India, and Brazil will
increasingly assume more prominent positions, while the United
States and other mature economies continue to play major roles
but gradually become less dominant.
A similar survey by AstraZeneca
already places China in 3rd
place and India in 4th in terms
of perceived innovation; and
projects them to be 1st and 2nd
by 2020.
How long until this becomes an
equivalent reality in pharma?!
Do you know where the next game-changing innovation
might come from? Are you confidant that you know what that
innovation might be?
Innovate Innovation
So you understand how important innovation is to the future
of your business. But are your innovation programs up to par?
The truth is, your innovation programs might need some
innovation themselves! CapGemini data suggests that only
1 in 3 innovation projects have a positive material impact on
business results. Maybe you need to realign and rethink. 75%
of respondents in the GE report strongly agree that the way
companies innovate in the 21st century is totally different to
the past and that innovation will be driven more by creativity
than scientific research. Those same respondents believe that
the most impactful innovations will require partnerships;
collaboration will beat solo effort.
Innovation leaders report that nearly 50% of their new ideas
come from either suppliers or 3rd parties. Are you looking in the
right place for innovation?
Are you asking the right people in your organisation or in your
value chain?
It’s all about you!
In addition to looking in the right place, you might also
want to look in the mirror; the biggest barrier to innovation
could actually be you. 39% of innovation ‘laggards’ report
that inadequate leadership commitment is what constrains a
company’s ability to achieve breakthrough innovation. Teams
responsible for delivering growth need Innovation Energy to
come from the top; driving both the organisational changes and
attitudes required to succeed.
For some the biggest challenge might be where to start; for
others it might be where to get the energy and inspiration for
greatness.
The idea behind New Pharma Thinkers is to solve these
problems.
We believe that with just 60 dedicated minutes of thinking time
per week, you can achieve greatness. New Pharma Thinkers will
provide you with stimulating articles from industry leaders and
the opportunity to interact with other like minded innovators.
Your company needs a brain. You’re it!
Start your weekly commitment to innovation.
References Bibliography:
The Nature Importance of Innovation http://press.princeton.edu/chapters/s9221.pdf
Boston Consulting Group Innovation Survey: https://www.bcgperspectives.com/content/articles/growth_innovation_innovation_2010_future_innovation/
http://www.ge.com/innovationbarometer/
http://www.slideshare.net/Dianne_i/world-innovation-forum-survey-full-details-final
http://blogs.hbr.org/cs/2012/05/a_simple_tool_you_need_to_mana.html
Fig. 3 - What drives innovation
Universal Pharma
1. Evolving customer needs Changing patient/payer demands
2. Technological advances changes Biotech information availability
3. Internal demands Growth is slowing!
4. Macroeconomics Reduced drug budgets
5. Globalisation competition emerging markets
6. Changing supplier capabilities Contract manufacturer/developers
Asa is the founder of Generic Pharma 2.0;
helping companies achieve transformational growth through smart ideas
and innovative opportunities. Asa has worked in the generic industry for
15 years and sees change ahead.
Do you know where the next game-changing
innovation might come from? Are you confidant
that you know what that innovation might be?