The Critical Role of Succession Planning in Pharma Leadership

Influential leaders like you are the driving force in the pharma companies to push forward the innovation, ensure regulatory compliance and maintain operational efficiency. The leader’s vision and decision-making skills directly impact the company's ability to deliver life-saving medication and achieve sustainable growth.

The pharmaceutical industry relies heavily on trustworthy leaders, and when such leaders plan to leave the organization, the company needs to fill the role quickly. However, in the event of an unplanned succession, the company has to bear severe losses. This article discusses the consequences of unanticipated success, how to identify future leaders and vital leadership development strategies. Keep reading to learn more.

Consequences of Unplanned Succession 

In other industries, the next leader can be selected at the last moment. Unfortunately, pharmaceutical companies must invest in a leadership pipeline focused on developing future leaders due to their specialized nature. Let’s understand how unexpected succession affects the company:

1. Loss of knowledge

Without succession planning, the departure of leadership may result in losing knowledge and expertise, disrupting ongoing projects, which can affect regulatory compliance and project timelines in the long run. Sudden leadership departures mean the new leader may not have enough time to learn everything from the previous one.

2. Regulatory non-compliance

A sudden change in leadership may lead to regulatory non-compliance if the new leaders may not be aware or untrained in compliance. This may result in fines, legal action, or brand value loss. Regulatory compliance is dynamic, and leaders may need to help to understand all the fine points.

3. Disruption in research and innovation

Pharmaceutical companies often have hundreds of drugs in the pipeline. Without succession planning and a clear leadership transition phase, the new leaders may not know the pre-decided directions for each project, resulting in project halts and delaying or derailment of critical projects.

4. Misaligning strategies

Sudden leadership changes can affect the company’s strategy. New leaders may not have the historical context, vision, or strategic decision-making skills needed to maintain the established plan. This can result in inconsistent decision-making and operational inefficiencies.

5. Loss of competitive edge

The pharmaceutical industry is a very competitive sector. Poor leadership transition can give competitors an advantage. Competitors can capitalize on the weakness/delays caused by long trial/training periods and sudden leadership changes, which means the company may lose its competitive edge.

Consequently, companies need to invest early on in pharma succession planning. They need to identify and select potential leadership candidates and train them. Thankfully, the identification of potential leaders is relatively simple.

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How to Identify Future Leaders?

While the selection processes vary from one company to another, companies can use the following strategies for developing future leaders:

1. Define leadership skills

The first thing to do is identify critical skills, qualifications, and competencies required for leadership roles. For example, leaders need deep knowledge of regulatory affairs, pharmaceutical science, and R&D. They must also have good strategic thinking, leadership, and innovation skills.

2. Performance reviews and feedback

Regular performance reviews and feedback can be used to identify potential leaders. 360-degree feedback can be used to understand the candidate’s leadership and people management skills. These can also provide insights into the candidate’s abilities.

3. Leadership assessments

Leadership assessment tools can be used to evaluate potential. For example, behavioural interviews can be used to indicate future performance. Situational judgment tests can be used to analyse their decision-making and problem-solving skills.

4. Project involvement

Aspirant leaders or promising candidates can be assigned high-stakes projects, and their performance during these projects can be evaluated to determine their potential. This does not mean the candidate is a good leader only if the project succeeds. Instead, these projects can be used to analyse the candidate’s leadership, communication, innovation, problem-solving, risk management, and decision-making skills.

5. Development programs

Pharma companies should focus on developing future leaders by providing them with the tools early on. For example, mentoring can be provided to candidates to guide their development. Companies can also conduct leadership workshops and training programs to build the skills of promising candidates.

When a company identifies a potential leadership candidate early on, it can provide the necessary tools to help them build skills. Training and development programs play a huge role in developing a leadership pipeline.

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Developing and Training the next leaders

Here are some specific ways training programs are essential for pharma succession planning.

1. Increase industry-specific knowledge

Companies can offer regulatory compliance training, allowing leaders to stay updated with regulatory guidelines. Clinical R&D training programs can also help leaders understand clinical trials, approval processes, strategies, etc.

2. Develop strategic thinking skills

Scenario-planning training programs can help promising candidates anticipate problems and resolve them. They can also be used to teach them how to deal with market and regulatory difficulties. This allows them to develop strategic thinking skills, which they can apply when they become leaders.

3. Improve management skills

Training can also improve candidates' leadership and team management skills. Team management workshops can teach potential candidates how to manage and motivate staff, resolve conflict, and foster collaboration.

4. Develop financial acumen

Finance is an integral part of decision-making in the pharmaceutical industry. Leaders need solid knowledge of financial management so they can make informed decisions. Financial management training and cost-benefit analysis workshops can teach leaders how to evaluate the economic consequences of their choices, allowing them to make long-term strategic decisions.

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Conclusion

At some point, all pharmaceutical companies need to think about identifying and developing future leaders. Leadership development in pharma companies must be seriously considered because so much is at risk. Poor leadership pipelines or pharma succession planning can adversely affect a pharmaceutical company. Most pharmaceutical companies do not have an active pipeline. Instead, they can invest time and effort in identifying potential leaders.

Promising candidates can be identified by providing them with high-stakes projects, assessing their performance, and conducting 360-degree reviews. Their talents can be further improved by offering training programs. In the long run, this will help the company smoothly transition into new leadership, which decreases the chances of knowledge loss, regulatory non-compliance, project disruption, and much more.

FAQs

1. What roles should be included in succession planning?

Pharma succession planning should focus on all leadership positions, including C-suite executives, the R&D head, the regulatory affairs head, the marketing head, the manufacturing head, the QC head, etc.

2. How often should pharma succession planning decisions be reviewed?

The leadership pipeline should be reviewed for any significant changes in the industry, business environment, organisation structure, etc.

3. How can companies maintain confidentiality in pharma succession planning?

Confidentiality can be maintained by limiting access to succession plans. Only the HR, C-suite executives and senior management should be included in the planning process.