Novartis cutting the red tape after lunch with middle managers

Dec/11/2007 05:54 Filed in: Pharma Business
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Environmental changes are forcing change(s) at big pharma which may be learning that "it's too big to compete". Dr. Vasella, the Novartis Chief Executive, said he realized the pharmaceutical division in particular was bogged down with bureaucracy after he had recent lunch with a group of its employees. One midlevel manager mentioned there were six layers of employees below him, which surprised Dr. Vasella. Surprised him? Maybe he should have lunch with more midlevel managers so he can learn some other tidbits as to why it takes so long for pharma to react to anything.



Give Novartis credit. Dr. Vasella, feels that the Swiss giant must become less bureaucratic to handle new challenges facing the drug industry: aggressive competition from generics companies; increasingly safety-conscious regulators; and more cost-conscious payers such as state health-care systems and insurer. So pharma is starting to get smaller but unfortunately that does not necessarily mean that they will become more efficient. All too often it means that one person will now take on the work of two or three others. What is needed are new processes to streamline communication with customers. Instead of doing the same thing over and over employees have to ask "what if"? How can we reduce process time lines yet still ensure quality? That is going to be the puzzle that pharma has to solve in order to get more competitive.


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There is no doubt that pharma is marketing in an extremely hostile environment. Rather than retreat from new marketing and operational processes however they should be looking at opportunities to both streamline communications with customers and to try new marketing programs that are both cost efficient and cutting edge. When results are gathered pharma then needs to evaluate and refine the processes until a successful model is achieved. I am not talking about Six Sigma, the GE process that set the industry on its head when CEO's read about GE's results. I am talking about a process that is adaptable over time. A process that can change as consumers become more empowered. That is the challenge for ALL business not just pharma.


Bob Dylan once sang "the times they are a changing" and part of the CEO's job now has to be to have his fingers on the pulse of the business so that he can be more proactive and less reactive at a time when the marketing environment is changing quickly.
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