There is probably not a senior executive on the planet who, at one time or another, hasn't raised an eyebrow or two to express exasperation over "people problems." But just try to run the modern business corporation without them. Forget the Internet chatter about the peopleless workplace. There’s no substitute for the contribution people make to the bottom line.
That bottom-line contribution is not a given, however. It depends on how well organizations bring on, nurture, and retain winners. You don't hear many senior executives of pharmaceutical, biotech, and medical-device companies complaining about the impending "war for talent" that was a common refrain five or so years ago. In many areas within life sciences companies, there is no shortage of talent. "There is enough talent out there for most positions, if you're willing to look hard and be patient," says Ross Jaffe, managing director of Versant Ventures, a healthcare-focused venture firm in Menlo Park, CA.
But, in a number of critical functions, top talent is as rare as identical snowflakes—and just about as fleeting. "We're seeing shortages of top research and development talent," says Joerg Reinhardt, CEO of Novartis Vaccines and Diagnostics. "In R&D, you really need specialists coming from the pharmaceutical area—there is an absolute scarcity, especially on the management level."Kimberly Popovits, president and COO of Genomic Health, a California biotech that specializes in molecular diagnostics, says that the exponential growth of industries such as targeted therapies, biomarkers, and molecular diagnostics has outpaced the training and expertise of most regulatory personnel. "There just aren't enough people who have caught up with these evolutionary changes," she remarks.
But talent scarcity is only one issue. The other is cost. Employee churn can be an expensive proposition, with serious bottom-line implications. According to a chief career officer at the HR solutions provider Adecco, writing in April on http://forbes.com/, a company of 40,000 full-time employees will likely save $140 million annually by reducing annual turnover from 40 percent to 15 percent. And the churn is spreading. Forbes also reports that last year, in one month alone, almost one-third of American Internet users visited an online job site like http://monster.com/.
Employee-turnover calculators have sprung up all over the Internet. They allow employers to figure out costly variables such as the hiring manager's salary, the cost of each training day, and the cost of having the position remain vacant while a search is under way. Employers can see just how much money is walking out the door every time they lose a talented worker.
Whether driven by scarcity, cost, or just the ongoing need to engage the best and brightest, smart executives in life sciences companies are attacking the issue at both ends. They are looking for new ways to attract winners, keep them motivated, and build loyalty for the long term.
The first part of this equation—attracting top-performing talent—is as much about method as the actual talent pool, no matter its depth. One rule of thumb: Avoid the delegation trap during the search process. "Many people believe that it's Human Resources' job to hire and keep people," Novartis's Reinhardt says. "That's the first step on the road to disaster. Looking for, interviewing, retaining, and motivating talent need to be a significant part of senior executives' job duties."
It is critical for executives on a talent hunt to think in new directions. For example, Reinhardt favors selective hiring from other industries for certain support functions. He finds that people with a different perspective "add immense value to the talent mix, especially when teamed with experienced pharmaceutical people." Making a job search an out-of-industry experience can also help diversify an organization's talent pool over the long term.
Creating market buzz about your company can be an effective method of gaining access to talent. Popovits says that Genomic Health began conducting open houses of its facility, making an overview of the company's business model an integral part of the tour. "We wanted to draw top minds who were considering going into the clinical lab practice or who were thinking about entering the business world," she says. "The results have been stellar. It is no longer as difficult to recruit very impressive candidates." Word of mouth about the company has spread. "The number of talented people who now seek us out is dramatically increasing."