Like many industries at the cutting edge of technology, the biotech industry demands exceptional leadership. That is why biotech CEOs are prioritising identifying and developing leadership talent at all levels within their organisation.
This creates a compelling talent challenge for the biotech industry as it balances operational requirements with the benefits of identifying and developing high potentials in the business. Many clients grapple with the headache of finding one solution that meets both the strategic needs of the organization and the motivational needs of today’s biotech workforce. Scarcity of talent is the most limiting factor for biotech growth.
Expected to be worth over $700 billion globally by 2025, the biotech sector is in explosive growth mode, Added to the challenge is the fact that the sector tends to create concentrated ‘communities’ such as the Boston biotech ‘ecosystem’. This leads to major – and smaller – players in the industries, competing for the same talent pool, or facing additional relocation costs for top talent.
Despite the high number of world-class educational institutions producing over 10,000 STEM graduates each year, at Norman Broadbent we are only too familiar with the challenges associated with the ‘talent squeeze’. While 10,000 STEM grads per annum is a cause for celebration, it is important to remember that leadership skills can be very different to those required to qualify in any given subject, and it is exceptional and fearless leadership that allows the best biotech firms to succeed. As Robert K. Coughlin, President and CEO, MassBio has noted, the industry “continues to grow and innovate at an incredible rate, creating both challenges and opportunities for companies who must fill their pipeline of talent to meet the increasing demands on their services.” Clearly, talent remains a potentially serious limiting factor to sustaining current levels of growth across the industry.
The biotech industry is at the forefront of a new ‘industrial revolution’, poised to change our lives in radical ways, making rapid advances in areas like therapeutics, genomics, agriculture, healthcare, nutrition, biofuels. Biotech firms are finding novel solutions to complex problems across the globe, tackling some of the biggest challenges that humankind is tackling.
Operating in a complex and fast-moving environment, it is no surprise that sophisticated leadership is required within this space. Making the most of explosive growth opportunities in this rapidly developing field require new ways of leading. Those ‘new ways’ are being discovered and developed at all levels throughout the organization. Many clients recognise the need to develop a leadership pipeline, identifying the leaders of tomorrow and engaging with them to develop their skills and exercise those skills with greater speed and flexibility. They must learn to be collaborative and work with other disciplines as technology develops across a widening number of disciplinary fields and industry ecosystems. And they must help their teams develop and apply these skills as well. No wonder four out of 10 tech leaders are failing—the highest leadership failure rate of any industry. Clearly, the industry needs to put greater effort into accurately identifying and developing tomorrow’s leaders.
Given the fierce competition for critical skills and the complex requirements of leading effectively in biotech, the costs of losing talent are high. Smart leaders are focussing on developing and retaining in-house talent to develop strong pipelines for the future. While many organizations focus high-potential talent development solely at senior levels, those that extend development of high potentials below senior levels are 4.2 times more likely to financially outperform those that don’t. In addition, research demonstrates that the benefits of developing and promoting from within versus hiring from the outside are many, including significantly decreased costs and significantly increased productivity. Put succinctly, a wisely promoted insider will typically outperform an outside hire for at least three years, and at a substantially lesser cost (see Wharton professor Matthew Bidwell’s Paying More to Get Less: The Effects of External Hiring Versus Internal Mobility).
However even once the benefits of identifying and developing internal talent is understood, many businesses struggle with putting the theory into practice. Identifying high-potentials, rather than high-performers, as well as developing a framework for “what good looks like” is a universal challenge, magnified by the speed of development and pressure of a growing industry. In addition, as recent neuroscience studies have demonstrated, managers are notoriously bad at identifying leadership potential in the ranks since their judgment is marred by a variety of hardwired evaluative biases.
Norman Broadbent’s Leadership Consulting team works with businesses across all sectors to develop objective and evidence-based programmes for creating success profiles (“what good looks like”) and assessments to identify skills and areas for development against those profiles. The insights offered provide an objective framework for decision making and development, de-risking the task of succession planning, and identifying both potential and strengths as well as gaps and risks to be addressed in individual development. This has helped our clients tackle challenges like:
- Placing people in supervisory and managerial roles without an understanding of their true capacity for leadership.
- Having people and operations that are geographically dispersed, making it difficult to know who or where their best future leaders are.
- Struggling to identify viable internal candidates for important leadership openings.
- Lack confidence in identifying the skillset their managers and leaders will need to thrive in the new world of work.
- Not having any real insight into the leadership bench across the enterprise, especially at the lower levels.