Naked Leadership: Stripped To Results In BioPharma

By Louis Garguilo, Chief Editor, Outsourced Pharma

The article Misjudging Leadership In the BioPharma Industry received reader attention and response. The subject of leadership and how it’s measured resonates within our industry.

To be clear, Misjudging Leadership casts no aspersions on BioPharma executives. It does claim chief executives more than ever are measured by a year’s financial results. Critical to this are the questions of actual correlation between “good leadership” and financial success, and if the BioPharma industry is content with that sole standard of measurement.

Here we’ll force an investigation into this modern-day minimalist verdict of leadership and whether it is our accepted measurement. It’ll require a quick, three-point thought experiment.

1. Leadership Charms Employees

We all know leadership results in high employee satisfaction/retention, which leads to better company performance and financial success. We all should think again.

There’s ample evidence we’re confusing cause and effect: It’s actually the financial success at companies – no matter how it is attained – causing higher employee satisfaction and retention. Why? Employees at profitable and growing companies feel secure in their jobs and future prospects, and believe they are positively contributing to a winning organization.

And the executive leadership part of the equation? To employees, it could be irrelevant by any measurement of leadership outside of the resultant company revenues and profitability. Workers might be advantaged by enlightened “executive leadership skills,” or held back to an extent by lack of such, but any number of variables lead to corporate profits no matter which. They include a new drug discovered/developed over years by talented scientists, an engineering breakthrough leading to a new medical device, and well-timed marketing campaigns and savvy sales teams taking advantage of both.

Point one: Even if not wholly content with the status quo, employees nowadays have accepted the narrowed definition of executive leadership and its assigned rewards and consequences. If the company’s making money, then there’s adequate leadership, proffered accolades and improved employee satisfaction. (If the corporate financials aren’t positive, the CEO needs to find a new job.)

2. Leadership At The Executive Level

Let’s enumerate some activities leading to the judgment of executive leadership strictly by the numbers:

A BioPharma hires a new chief executive to raise last year’s drowning stock-valuation (poor pipeline), lackluster margins (poor performance) and stagnant revenues (wrong therapeutic strategy). Of course by our yardstick these problems are in large part a result of the previous CEO’s “bad leadership.” The new CEO among other things:

1. Fires executives and staff he judges part of the old problems and not up to the new direction;

2. Lures (by hook or by crook, as they say) executives away from his (or her) former company to take their places;

3. Cuts hundreds or thousands of jobs to gain profitability and move in the new direction;

4. Works tirelessly with investors to raise the stock price.

Not the most pleasant of activities, perhaps, but this certainly smells like success and “applied leadership,” doesn’t it? It’s viable (potential to raise profitability), understandable and easy to measure in the aggregate (financials improve or not). If this new CEO is personally liked (a “people person”) or not, dynamic or reserved, kind or not so much, doesn’t matter … and perhaps hasn’t for quite a while. The job description is to determine the new direction and strategy, not an easy task, and then let subordinates do the heavy lifting to implement.

Point two: “Executive leadership” looks different than leadership on other levels; in fact, it’s an altogether different beast. CEOs make the hard decisions – which facilities to shut down (or acquire), which product lines or therapeutic areas to cut (or focus on) – then add up the dollars by which they are judged. The “qualities and skills” of leadership we often want to discuss and measure (subjectively), are of the management “rank and file.”

Bringing us to the ranks of a different sort.

3. Leadership In Re-Supply

A retired Lieutenant Colonel who spent over 25 years in the U.S. Army likes to talk about leadership. However, he always shifts the focus from the behavior of leaders to that of “followers” – troops in his military or our employees. I try engaging in discussion of mega-figures from U.S. history, like WW II generals Dwight Eisenhower, a politically cautious personality who became a U.S. president, and George Patton (“Old Blood And Guts”), a charismatic ground leader who inspired his troops to feats of heroism.

But he won’t pick this line up. In fact, he brings leadership down a few levels, exemplified in this anecdote:

A support-company commander in a Special Forces battalion set a personal goal –confirmed vital by his superiors – of creating more effective re-supply SOPs.  He’d experienced a lack of reliability and utility in effectively re-supplying teams in the field.

Since the support-company personnel hadn’t served on a Special Forces team, the commander sent them to a field drop-zone one night to receive a “re-supply bundle,” one they themselves had prepared. The bundle, dropped by parachute, contained packaged ammunition, food, water, fuel, etc. The support team fumbled in the dark for hours to find specific items and organize … until they gave up.

The commander then simply told the team to find a better way.  In just weeks, they created the revolutionizing modular resupply system. “Was the commander a suitable leader?” asks our Lieutenant Colonel. “Yes, but none of what he did goes into the annals of great leadership behavior. To me, leadership is simply getting people to accomplish difficult goals established as worthwhile.”

Point three: By defining other-level leadership as situational approaches that succeed or fail to have employees accomplish established goals, we also effectively narrow measurement at this level to results. Here, too, messy subjectivity and mixed up causality is removed from the discourse.

Leadership Coda

Therefore, have we not shown that even employees accept the narrowest measurement of executive leadership as financial results (Point one); that executive leadership fundamentally differs from leadership on other levels (Point two); but that we can also strictly narrow the measurement of other-level leadership, to results obtained by employees working on set objectives (Point three)? In so doing, we’ve gotten to the core of today’s leadership and its measurement in BioPharma and elsewhere.