Can Pharma Learn from Automotive successes in collaboration?

I’ve been looking more into health care as it relates to pharmaceutical companies and am seeing interesting opportunities for collaboration, process management, etc.

Can Pharma take advantages of collaboration lessons learned in the automotive industry? In short, the answer is yes.

Economic and business changes in Pharma are pushing firms to rethink business operations, process methods and the “way of doing business”.  End of cycle intellectual property, cost of manufacturing, and long-term sustainability are forcing pharma companies to reconsider past business models across the venture. Pressure from off shore generics and other regulatory and external factors contribute additional instability.

 Benchmark studies indicate that the domestic automotive industry was facing significant similar challenges during the later part of 1990’s. Pressure arose from Japanese car manufacturers in-sourcing plant operations in the south as well as competitive business practices following concepts of TPS (Toyota Production System). These actions, together with internal assessments of the current state of the business, forced auto companies to shift towards a lean operations model that sought to increase speed of execution, improve quality, reduce costs and, in general, do more with less. This lean operations model was applied equally across manufacturing and product development and was extended to include a reduced number of suppliers in a much tighter working relationship.

The shift in domestic automobile industry also saw migration to systems thinking, a focus in integration and process management, and increased attention towards efficient execution. These needs drove additional changes in the way business practices were conducted and supported. A notable change was the introduction of flexible, business friendly tools that could be managed at the business unit and which could make immediate impact. Hugh scale IT tools that took years to create and dozens of IT people to support, gave way to Out of the Box applications that could be configured by the business unit to support its business, its processes, its documents and its communications. A prominent tool that emerged was collaboration: both as process management and the tools to support it.

What defined the issues at the execution level?

Business units relied on email as their primary process execution tool. Documents were passed back and forth, suggestions for changes offered from multiple sources, multiple versions of documents were in play at the same time and most members of the staff were unsure which was the “right” document. In emails, people were constantly asking how to do something, since a standard process didn’t exist. Significant amount of time was spent on getting clarification about what to do, where to find something, who did what, or sending a document (often the wrong one) to a supplier, playing phone tag with suppliers, delaying necessary actions, or aggregating multiple documents into a single readable summary report.  In general, time was spent just trying to figure out how to operate within ill-defined processes.

Does that sound familiar? 

Many solution suppliers want you to believe that content management is the key to success. Were high cost and poor execution in automotive firms about inadequate document sharing or content management? Not really, it was about out of control processes, poor process management and inefficient execution. The most successful among the automobile companies focused the solution on process optimization and making people successful. And by getting the process right, the documents “just went along for the ride”.

In the end, business units conducted their business within collaboration frameworks that were structured to mimic the best process methods and to provide a familiar workspace that delivered benefits to all members of the staff.  Teams of business managers and staff create the frameworks after much thought with regard to past practices, new needs and a new attitude brought on by the realistic business condition called “the wolf is at the door”. Collaboration set people to working better in teams, developing a single process that they could all agree on, defining procedures for dealing with documents, and other activities that seemed so mundane in previous years.

Changes and pressure in the automotive industry gave rise to changes in business practices, which drove increases in execution efficiency. Collaboration around processes was a major driver. With changes forcing Pharma executives to reconsider past practices, can Pharma learn from Automotive and seek to shift to a process centric execution model supported by concepts and tools of collaboration?