I would go to these meetings where the CEO would expound on some aspect of strategy or some key decision. Driving back in the limousine he would turn to me and ask what I thought of his presentation. I was smart enough to answer: It was brilliant. It was just what everyone needed to hear. DIA Pharmaceutical Industry Survey+ Participant

When the CEO asks what you think that’s not what he or she is asking. Moments of lucidity do arise, but these are not the moments. Every once in a while, discontinuously, c-level officials will come to realize that having a World Class R&D capability is good for both the corporation and for themselves. When these rare moments arise we must have at-the-ready a good story for how greater R&D protections contribute to even greater blockbuster+ success.

Nothing succeeds like success. We take advantage of blockbuster moments to lobby for protections that can lead to that next blockbuster. The corporation has just received a bolus of cash and profits, and it’s time to invest some of this windfall+ into further protections of R&D. People are momentarily in the habit of saying yes, so we frame further protections in a way that ties them to that success we just enjoyed. We leverage today’s success to ensure future success.

Management in our franchisees understands the discontinuous nature of blockbuster discovery. Each franchisee has an equal shot at being first to the market with a blockbuster product; or last. The longer the delay the more important the R&D protections. So as part of the franchise agreement we include participation of the Franchise Oversight Committee+ in the negotiation and sale of franchisee blockbusters. The committee assigns a value to desired R&D protections and negotiates for them on behalf of the franchise organization during the sale of blockbusters. Current dollars for future protections, paid for using windfall profits made possible by the franchise structure.

There’s nothing like a crisis to get people thinking in new and innovative ways. It sharpens the focus. We prepare for moments of crisis just as we would for moments of success. We have an inventory of R&D protections at-the-ready, and either frame them as the answer to the crisis, or slip them into broader answers to the crisis. See here for an example. Protections have significant value and we should willingly make concessions in current R&D spending in exchange for future R&D protection. We can only pull this off when we have already grabbed the audience’s attention, i.e., during a crisis.

The prime moment for implementation of protections is when the corporation accedes to the request to build a World Class R&D capability: a wholesale revamp of the existing R&D strategy and operations. The corporation finally decides that the correct answer is to loosen its grip, and to move away from a command & control approach to R&D. This will be discussed in detail, as a future World Class R&D front page feature, and so is not now covered. However, the moment for inserting protections is fleeting, and all R&D organizations can benefit by building up an inventory of needed protections. Be prepared for when the moment hits.

Home Page August 2010