The big issue

Whether you want to lead or follow, you need to understand the elephant in the C-suite

Life science companies vary enormously in size, structure and strategy. So you might expect that if you asked CEOs what their big issue was – what consumed their time and attention – then their answers would be idiosyncratic and particular to their situation. As I researched my latest book (see below) I asked exactly that question but the answers surprised me. Sure enough, at any one time a CEO might be focused on a particular issue, such as the pipeline, a product launch or a production problem. But look beyond these proximate concerns and the same challenge lay beneath all their replies. And whether you aspire to the corner office or simply have to meet the objectives that emanate from it, you need to understand the elephant that stamps around in the C-suite.

Many CEOs, one answer

Faced with hundreds of thousands of words of interview transcripts, my research uses a methodology called thematic analysis. Simply put, I read and re-read what the CEOs have said and then mark out phrases and words that reflect a similar idea. For example, one CEO might mention patent cliffs and another generic threats, but they are both talking about late-stage life cycle management. Over many hours of analysis, multiple ‘themes’ emerge that eventually reveal which issues are common in the minds of the interviewees. It’s a qualitative method but with semi-quantitative outputs: some themes are minor, some major and, in this research, one stood out above all others. But to understand that big issue fully, we need a brief detour into management science.

Expertise means macrocongruence

Over 200 years ago, Adam Smith asked why a pin factory employing many workers was so much more productive than the equal number of solitary cottage workers it replaced. The answer, now a dogma of management science, was specialisation and coordination. Making pins involves many steps and when workers specialise on one step, then pass it on to the next specialist, they produce more pins, at less cost, than their solitary, generalist competitors. Fast forward a couple of centuries and two eminent business sociologists refined the idea. Burrell and Morgan saw that, in modern business, every task is intensely specialised and demands a high level of specialist knowledge and skills. To be effective, they argued, specialised workers had to be macrocongruent, meaning wellaligned to their particular external environment. The need to be macrocongruent is as true for marketers (congruent to the market environment) as it is for scientists (the technological environment) as it is for regulatory specialists (the regulatory environment). Think of any one of your most expert colleagues and you will find that they are strongly macrocongruent to their part of the outside world. In a real sense, expertise means macrocongruence.

Coordination means microcongruence

Burrell and Morgan didn’t stop at macrocongruence. They also saw that, in a modern business environment, coordination means much more than simply passing the task on to the next in line. In a life sciences company, for example, every specialised expert has to coordinate with many others in a constant, bidirectional flow of work, ideas and information. Burrell and Morgan found that macrocongruence alone was not enough and that experts and specialised teams must also be microcongruent, meaning well-aligned to the internal environment. They combined the two ideas by saying that organisations are effective when they are bicongruent, meaning that they must be made up of highly macrocongruent teams of specialised experts who must each, at the same time, be highly microcongruent with each other. Put like that, it seems self-evident, but Burrell and Morgan made one more vital observation.

Push-me, pull-you

In the Dr Dolittle stories there is a creature called the ‘Push-Me Pull-You’, a sort of llama with two front ends facing in opposite directions. It is a good metaphor for what Burrell and Morgan saw as the challenge of achieving bicongruence. They saw that as markets become more technologically and sociologically complex, experts can only maintain their macrocongruence by becoming ever more specialised. Again, think of your colleagues: compared to a generation ago, they now specialise not only by discipline but also by sub-discipline, geography and therapy area. This increasingly tight focus allows them to maintain their macrocongruence but it is also leads to narrower, deeper knowledge, arcane jargon and a particular view of the world. For example, everyone working in the life sciences industry is familiar with sales and compliance having different perspectives on the same issue. What Burrell and Morgan pointed out was that as the macrocongruence end of the Push-me Pull-You went in one direction, it pulled against the other end, pushing to achieve microcongruence. In other words, as experts become necessarily more expert, they develop knowledge, jargon and views that make it harder to coordinate with their colleagues, who are evolving their own specialised knowledge, jargon and views. The internal contradictions of achieving bicongruence – simultaneous macrocongruence and microcongruence – are the central dilemma of all businesses but especially of complex, knowledge intensive businesses. This is now well-established thinking in management science, some decades old. But as I meticulously read, coded and analysed my interviews with the CEOs of leading life sciences companies, Burrell and Morgan’s ideas started to emerge again. And of the many themes that did emerge, bicongruence grew to be the one mentioned most frequently and most widely.

By any other name

To be clear, in all of the interviews I carried out, the word bicongruence was never mentioned. Nor were its components of microcongruence and macrocongruence. But Burrell and Morgan’s concepts were given many other names. CEOs spoke of how the breakneck speed of technological change in biology, information technology and other areas was difficult to keep up with (that is, it is hard to maintain technological macrocongruence). They said the same things about change in the sociological environment, such as payer systems, epidemiological shifts and demographic trends (that is, it is hard to maintain sociological macrocongruence). They described their efforts to keep up, from restructuring to recruitment and development policies and how these resulted in organisational complexity and sometimes ‘Balkanisation’. The last term surprised me; it is borrowed from political science and describes fragmentation accompanied by hostile or uncooperative behaviour. What became clear was that CEOs were not only aware of the Push-Me Pull-You challenge of achieving and maintaining bicongruence, it was their major concern. Beneath every proximate, short-term problem they faced lay the ultimate, persistent challenge of doing two opposing things at once: specialising and coordinating in Adam Smith’s terms, achieving macro- and microcongruence as Burrell and Morgan would describe it.

Three CEO tricks

In my interviews with industry leaders, I had begun by asking them what challenges they faced and then switched my questioning about how they addressed those issues. As my analysis moved onto the second part of each transcript, I was looking for common themes in how they tried to achieve bicongruence. The leaders described many different ‘tricks’ they had learned, but these consolidated into three common themes.

The first of these, like bicongruence itself, echoed a concept in management science that is well-accepted but is rarely talked about today: organisational salience. When they look at how people work, organisational behaviourists describe how people can focus their loyalty and effort either on the work-group (eg, a team or department) or at the higher level of the company. They name these behaviours as group salience and organisational salience respectively and the balance between them is an important aspect of an organisational culture. When group salience is high, people will often put their team before the company; when organisational salience is high, the reverse is true. As I pored over the interview transcripts, it became clear that one thing that all CEOs have learned to do is to recruit and manage their leadership team for high organisational salience. If members of the leadership team exhibit high group salience and put their function before the company, they don’t last long. As far as I could tell, this was an important factor in the leadership team restructuring that is often seen soon after a new CEO takes over.

The second theme that emerged was a negative one, in the sense that it was something CEOs chose not to do; they chose not to concern themselves greatly with macrocongruence. Instead, they leave the fit to the external environment in the hands of functional leaders and see the CEO role as facilitating those leaders. In this, we can see an important lesson: good CEOs have realised that every part of the environment is now so complex that they can’t understand it themselves, so they must delegate to functional experts. A number of the interviewees explicitly described ‘not meddling’ as a lesson they had learned the hard way, especially with respect to the functions they had performed in their early career. In addition, by leaving the macrocongruence issue to their team, CEOs allowed themselves time to concentrate on the microcongruence component of bicongruence.

The third ‘how to achieve bicongruence’ theme to emerge was the most intangible but the most interesting. The CEOs kept returning to the issue of mutual trust among the leadership team and described two ways in which the complexity of the life sciences industry made trust especially important. First, the specialisation of each function was so great that each team member could understand little of their colleagues’ work and, consequently, had to take each other on trust. Second, the interconnectivity of the functions made it quite easy for any function, if they wished, to damage or hinder another function, either actively or passively, without being held accountable. This again made mutual trust essential and CEOs described how they recruited, retained and led to achieve that vital intangible asset.

Taming the elephant

Not everyone reading this article will aspire to the highest levels of leadership and, of those that do, only a minority will get to the C-suite. But everyone, at every level, is affected by what happens there. So if bicongruence is the big issue, what are the lessons here for the rest of us? There are four.

First, be macrocongruent to your particular environment. CEOs and other leaders cannot manage your alignment to your particular part of the outside world, whether that be the customers, the technology or the law, so they value that you do.

Second, develop T-shaped skills. This means that, in addition to the narrow, deep (I-shaped) skills you need to be macrocongruent, you need broad, shallow knowledge of other functions. This T-shaped combination of skills is valued because it enables microcongruence with other functions.

Third, develop organisational salience. As social beings, we all have a tendency towards group salience but this is anathema to CEOs. They value subordinates who understand and support organisational goals, even at the cost of putting your own team in second place.

Finally, become trustworthy. The workings of a complex life sciences organisation are ‘oiled’ by trusting relationships. Trust takes time and effort to earn, usually via honest behaviour, delivering on promises and avoiding political behaviour. For CEOs, trustworthiness is the most highly valued attribute.

It is true that, on any working day, your CEO may face a thousand issues. But from the C-suite, the elephant in the room is always bicongruence. For the rest of us, these four things are how we tame it.

This article and the others in the series are based on ‘Leadership in the Life Sciences: Ten Lessons from the C-Suite of Pharmaceutical and Medical Technology Companies’ and is available in hardback and electronic versions from all major outlets.