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featureRethinking leadership in drugdiscovery projects

Andreas Schneider1, Zeynep Erden1,*, zerden@ethz.ch, Hans Widmer2, Guido Koch2, Christine Billy2

and Georg von Krogh1

Great efforts have been dedicated to rebuilding the engine of pharmaceutical R&D. However, one

potential area of improvement has received limited attention in the literature and in practice: namely,

leadership. In this article, we enrich the traditional views of leadership, which consider leadership a

responsibility of a few centrally placed authorities, with the concept of distributed leadership.

Distributed leadership reflects a group-based capability driven by everyday activities and the key

scientific questions at hand. We identify three leadership challenges faced by R&D teams that could be

addressed by implementing distributed leadership. Furthermore, we provide some suggestions as to how

to foster distributed leadership in drug discovery projects.

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Introduction

The pharmaceutical industry, once admired for

its years of profitability and expansion, is facing

major challenges [1], including a tighter regu-

latory regime [2], decreased access to capital as a

result of the global economic crisis [3], patent

expirations of various blockbusters and the rise

of generics [4,5], increasing price pressure and

strained healthcare budgets [2], eroding public

confidence [6] and increased market competi-

tion from emerging countries and specialized

small companies [1,7]. Although these external

developments can partly explain the issues

regarding the performance of the big pharma-

ceutical companies, a growing group of scholars

also note the diminishing productivity in drug

discovery as a main source of the problems

[1,3,4,8–10].

Management research and practice groups

have proposed and launched various initiatives

to close the gap in R&D productivity [4,11–13].

1258 www.drugdiscoverytoday.com 1

However, efforts have mostly focused on how to

redesign research activities in drug discovery

optimally [4,11,14]. Clearly, organizational

designs in drug discovery shape the way in

which specialist activities are coordinated, but

the ‘human’ aspects should not be ignored when

considering alternative redesigns. Drug discov-

ery is a knowledge intensive activity, and the

outcome significantly rests on how well the

differences in the scientific backgrounds,

expectations, beliefs, experiences and interests

of scientists are coordinated and aligned to

achieve a common goal. Formulating goals and

visions, coordinating activities, motivating peo-

ple, attaining knowledge exchange and per-

forming related tasks are all aspects of effective

leadership that are needed to maximize the

performance of R&D teams. Interestingly,

industry observers have often neglected the

notion that most of the activities for optimizing

the drug discovery processes depend on how

359-6446/06/$ - see front matter � 2012 Elsevier Ltd. All rig

well brilliant scientists are led. Whereas various

studies show the importance of leadership for

creativity and innovation (see Ref. [15] for a

review), only a few studies explicitly discuss the

enabling role of leadership in biomedical

research or, more specifically, in drug discovery

[4,16–19]. These studies call for more research

regarding the roles of leadership in boosting

productivity in pharmaceutical R&D.

Here, our article addresses this gap by relating

a recently developed conceptual framework on

distributed leadership and organizational

knowledge creation [15] to drug discovery.

Distributed leadership reflects a situation in

which multiple members of a drug discovery

project share leadership roles, responsibilities

and activities [15,20]. The objective of our

case study is to explain the concept of distrib-

uted leadership for the pharmaceutical research

departments, to show how distributed

leadership provides an opportunity to address

hts reserved. http://dx.doi.org/10.1016/j.drudis.2012.06.005

Drug Discovery Today � Volume 17, Numbers 23–24 �December 2012 PERSPECTIVE

Stable; centralized; rootedin hierarchical position

Planned; directed Spontaneuous; intuitive;unstructured

Informal; unorderedFormal; ordered

Emerging; fluid; based onexpertise and interests

Nature of collaborations

Resulting work environments

Authority in decision making1

Cen

tral

ized

lead

ersh

ip

Dis

trib

ute

d le

ader

ship

2

3

Drug Discovery Today

FIGURE 1

Key characteristics of centralized and distributed leadership.This figure is adapted, with permission, from von Krogh et al. [15].

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challenges and to suggest possible ways to

improve productivity through balancing cen-

tralized and distributed leadership. In a nutshell,

we argue that a dialogue between centralized

and distributed leadership, in which respective

responsibilities are negotiated and clearly

defined, is essential to boost innovation and,

ultimately, productivity in pharmaceutical R&D.

First, we briefly explain and contrast tradi-

tional centralized leadership models with dis-

tributed leadership. Then, we outline three

current leadership challenges faced by R&D

teams that could be addressed through dis-

tributed leadership. Finally, we show how man-

agement can proactively foster distributed

leadership in drug discovery projects.

Distinction between centralized and

distributed leadership

To lead means to provide guidance and direc-

tives to a team, to plan, motivate, inspire,

encourage, empower and clarify the expecta-

tions of followers, to articulate visions and to act

as role-models [15].a The relationship between

leadership practices and a firm’s ability to

innovate has been demonstrated in previous

studies [15,21–23]. Recently, we developed a

framework [15] showing that leadership in

a It is important not to confuse the concept of

‘leading’ a drug discovery project with that of

‘managing’ it. A project manager that overseesthe everyday activities of projects, such as coordi-

nating activities, scheduling meetings or acting as a

responsible contact person for external stake-

holders, does not necessarily inspire, motivate,encourage or – in short – lead the project team.

organizational knowledge creation and innova-

tion is based on a continuum of activities that

range from centralized to distributed activities.

On the one hand, centralized leadership

describes a situation where central and stable

authorities are based on hierarchical positions,

such as the senior management in disease areas

or scientific review boards, and these authorities

reinforce formal organizational structures,

design communication channels and control the

flow of information. Centralized leaders exert

authority over followers and plan and direct

collaborations to achieve a particular goal. On

the other hand, distributed leadership describes

a situation in which the leadership roles and

authority are distributed among multiple indi-

viduals in, for example, drug discovery project

teams or organizational units. Rather than being

an external force, distributed leadership is a

group capability embedded in practice; it is part

of the people’s collective engagement with their

work [15]. With distributed leadership, indivi-

duals switch between being leaders and being

followers. Such leadership aligns individual

interests and goals and results in mutually

shared commitment to current and future

activities [15,24,25]. Figure 1 illustrates the dif-

ferences between centralized and distributed

leadership.

The dialogue between centralized and dis-

tributed leadership is key to engage participants

in innovation [15]. Pharmaceutical firms should

clearly distinguish between the responsibilities

of distributed and centralized leadership across

three different layers of activity: ‘a core layer of

local knowledge creation; a conditional layer

that provides the resources and context for

knowledge creation; and a structural layer that

forms the overall frame and direction for

knowledge creation in the organization’ [15].

Knowledge creation and innovation occurs at

the core layer through everyday interactions

between scientists in an informal, dynamic and,

to a certain extent, chaotic environment [26]. At

the core layer, distributed leadership enables,

initiates and sustains the ‘core activities’ of

knowledge creation and enables collaborations

to emerge in unstructured, autonomous and

spontaneous ways. For example, it is the col-

lective responsibility of drug discovery project

teams to establish an appropriate workflow of

experiments. They should define which assays

would be best employed to answer the question

at hand, whether it would be appropriate to run

these assays in parallel or sequentially, anticipate

and assess the risks involved, and propose a lead

finding or clinical candidate selection approach

to senior management.

At the structural layer, centralized leaders,

such as divisional senior management, reinforce

the formal organization, allocate resources,

coordinate and control processes without dis-

rupting the informal and everyday ‘core activ-

ities’ of knowledge creation. Centralized leaders

can formulate the scientific vision that spotlight

promising therapeutic areas and set the firm’s

future strategic directives. At the conditional

layer, centralized and distributed leadership

complement each other and generate the con-

ditions to relate informal knowledge creation

processes with the demands of the formal

organization, as expressed in goals, structure

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and processes. Centralized leaders, for example,

secure access to resources and knowledge

needed at the core layer, such as senior level

expertise and lessons learnt from prior drug

discovery projects. In addition, when knowledge

creation breaks down, for instance due to con-

flicting views on problem solving that cannot be

resolved locally by the team, the centralized

leadership mediates the resolution of the

problem.

Toward distributed leadership in drug

discovery

This section discusses how complementing

centralized with distributed leadership can boost

productivity in pharmaceutical R&D. We argue

that it can do so by addressing three crucial

leadership challenges related to (i) the inherent

complexity of drug discovery projects, (ii) the

locus of decision-making power and (iii) con-

flicting interests among project team members.

We identified these challenges based on an

ongoing study of drug discovery project teams

in a global pharmaceutical firm. The study

combines nonparticipant observation, inter-

views and an analysis of secondary data.

The inherent complexity of drug discovery

projects leads to the first leadership challenge.

The scientists we interviewed underscored that

integrating various specialty expertise areas

constitutes the very essence of drug discovery.

However, there is no standard way of effectively

interrelating different scientific disciplines, such

as bioinformatics, molecular modeling, biophy-

sics, preclinical safety, pharmacokinetics or

translational medicine. We observed that keep-

ing track of, relating and translating the knowl-

edge generated during a project into action

steps reflects one of the most important chal-

lenges in drug discovery. Furthermore,

researchers are confronted with entirely differ-

ent scientific questions in various project stages.

This calls for the dynamic involvement of

expertise and leadership from different scientific

experts. For example, whereas assay developers

are more likely to drive the early-stage lead

finding, we find medicinal chemists to guide the

lead optimization stages and pharmacologists to

have the major role in candidate selection. It is

therefore improbable that a single specialist with

a given disciplinary background can follow in

detail and fully comprehend the entire process

from target discovery to the clinical proof-of-

concept. When distributed leadership is not

exercised, the inherent complexity of drug dis-

covery projects calls for ‘superheroes’ as formal

project leaders who can lead all activities: eval-

uate, negotiate, budget, coordinate, decide,

1260 www.drugdiscoverytoday.com

align, delegate and control, while at the same

time advance their laboratory work. The ‘great

man’ theory of leadership was mostly aban-

doned in the 1960s because it became evident

that a given individual cannot be equally

effective in all situations. As we know from the

comic strip The Fantastic Four, even superheroes

have specialized skills and traits and, in most

companies, such talent represents the exception

rather than the rule.

In our view, a drug discovery project is a

complex undertaking that necessitates leader-

ship roles and responsibilities to become dis-

tributed among the key project team members,

their managers and the scientific disciplines

involved. Authority should become fluid, situa-

tional and dictated by a particular problem at

hand [15]. In the course of a drug discovery

project, the level of team members’ authority

should evolve by virtue of their disciplinary

expertise, ideas or interests.

The second challenge is related to the locus of

decision-making power. Problem solving in

pharmaceutical R&D is neither linear nor pre-

dictable. For instance, drug discovery scientists

might not have validated hypotheses on which

protein to target in the pathway. The molecular

mechanism of action of compounds identified in a

phenotypic assay could be unknown, and com-

pounds inhibiting an enzyme in vitro might not be

active in a living system, for example because of

feedback mechanisms or pathway redundancies.

When scientists in the teams do not feel that they

are fully empowered to adapt flexibly and

autonomously to unanticipated situations in

everyday scientific activities we observed that

central leaders take key decisions for the projects.

As a consequence, decision-making processes

might slow down and organizational rigidity

might increase. This is typically accompanied by

an increasing risk of losing promising business

opportunities arising from complex project ramp-

up phases and slow resource allocation.

According to the framework, the locus-chal-

lenge should be remedied if centralized leaders

create more-autonomous team structures where

distributed leadership can flourish. Centralized

leaders should secure the necessary environ-

ments, the senior expertise and the resources to

unleash the scientists’ creativity. However,

whether the scientists’ creative potential is

transformed and fully exploited hinges on the

distributed leadership within the team. For dis-

tributed leadership to unfold, drug discovery

project teams should self-organize and take

decisions within the boundaries agreed upon

with centralized leaders. Distributed leadership

‘energizes’ the working conditions, which are

built and stabilized by central authorities in the

structural and conditional layers.

For instance, a drug discovery project team

might have committed in the lead finding plan

to target the catalytic active site of a protein.

However, a team member, following her intuition

and expertise, could instead suggest that an

allosteric site of the protein can offer alternative

opportunities to inhibit a given biological

activity. She accordingly starts to convince and

motivate her peers, energizes the team to take a

different perspective and tries to commit the

team to shift the scientific focus toward alter-

native experiments. Once the team agrees to

pursue her suggestion, the central leaders

should help the team to realize their plan and

empower the team with the resources that the

experiments require.

The third challenge is related to conflicts of

interest between the drug discovery project

team members. Although members agree on

high-level shared team goals, we observed that

conflicts of interests can emerge in everyday

drug discovery activities. Preferences of indivi-

dual team members or priorities defined by

research boards or line functions can differ

across disciplines and organizational units. For

instance, one project team we studied debated

whether a novel technology should be priori-

tized over a more established approach for lead

finding. Although the experts of the novel

technology were questioning whether it actually

has the power to (partially) substitute the

hitherto dominant approach, line management

was strategically advocating the use of the new

technology to have a pivotal role in the project.

In another example, we observed that, whereas

some disciplines were encouraged to endure in

solving a particular problem, others were pushed

toward seeking alternative solutions at an early

point in time. The medicinal chemists often

persisted in optimizing one given structural class

of compounds, whereas computational chemists

were inclined to compare, morph and scan

distinct scaffolds of lead structures that could

require difficult synthesis protocols.

These conflicts could be addressed if various

levels of line management, each representing a

centralized and hierarchical authority, set

incentives and priorities that are informed by the

shared group objectives that emerge as a result

of distributed leadership. At the core layer of

everyday activities in drug discovery, scientists

can exercise leadership by deciding with whom

to collaborate and why [15]. When distributed

leadership is exercised in the core layer, people

engage in leadership and follower behaviors as

appropriate and repeatedly act in the group’s

Drug Discovery Today � Volume 17, Numbers 23–24 �December 2012 PERSPECTIVE

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common interest to reach consensus on how to

achieve common goals [15].

The three leadership challenges suggest that

the complementarity between centralized and

distributed leadership [15] can be important for

successful drug discovery. In effect, pharma-

ceutical companies should clearly distinguish

between central leaders’ activities and the

activities emerging although distributed lea-

dership. We observe that, in particular, matrix

organizations can be prone to the challenges

discussed. Our framework that advocates a

dialogue building on clear roles and responsi-

bilities between centralized and distributed

leadership disentangles what people commonly

refer to as ‘successful matrix management’. In a

good dialogue, the project and the functional

dimension of the matrix organization inform

each other in a cooperative and mutually sup-

portive manner.

How to foster distributed leadership in

drug discovery

Distributed leadership reflects a group capability

that is hard to build and easy to lose. Distributed

leadership is fostered through training and ‘on

the job’ experience [27]. Managers should

therefore provide conditions and introduce

various initiatives that center on individual

training and team mentoring, knowledge

enabling and organizational culture. We provide

examples from our observation of successful

implementations below.

Individual training and team mentoring

Particularly in pharmaceutical R&D settings,

authority should be situational and fluid, which

implies that individuals act as leaders in some

situations and followers in others [15]. Each drug

discovery team member should consider

themselves as leaders and be perceived as being

‘entitled’ to lead appropriate parts of the project

at a given point in time. This task is not trivial.

Managers should help scientists change their

perception of authority from a position that is a

static and central hierarchy to a situational ability

deeply rooted in their work. Researchers should

fully and freely participate and contribute in all

scientific and strategic discussions, and they

should not be restricted to their field of exper-

tise, because this participation provides training

for distributed leadership.

We also see that newcomers need to be

equipped with the necessary skills, tools and

principles that enable them to act as team player,

negotiate with peers, convince other team

members, lead scientific discussions and ulti-

mately realize their potential as leaders. Basic

leadership development workshops should

therefore be integrated in standard educational

programs for new researchers joining drug dis-

covery departments. Similarly, team mentoring

helps familiarize drug discovery project teams

with the idea of distributed leadership. Experi-

enced team leaders can provide mentoring to

project teams outside of their area of direct

managerial responsibility. In this way, the project

teams benefit from independent views, advice

and ideas on diverse teams and project topics

(e.g. team dynamics, scientific and strategic

options and stakeholder management), while

keeping full ownership of a project. Individual

training and team mentoring enable team

members to develop new skills, learn and foster

collaboration and innovation across functional

boundaries, disease areas and research sites.

Knowledge enabling

The introduction of distributed leadership

becomes easier once project team members

develop a shared understanding of ‘who knows

what’ [28]. Knowing who is the expert for a

particular problem legitimizes ‘who leads when

and why’. Knowledge management initiatives

pursued by the team and the company increase

the transparency of what the overall team knows

and boost the acceptance of distributed lea-

dership. For instance, knowledge maps provide

detailed information on individual skills and link

clusters of knowledge within and beyond drug

discovery project teams [29]. As such, knowl-

edge maps profile and visualize what the team

knows, unveil the otherwise opaque pattern of

ever-changing authority and ultimately legiti-

mize situational leaders.

Organizational cultureTo enable coordination, project members are

required to reveal their expertise to the other

members. However, when members over- or

under-state individual expertise, credibility and

trust are compromised. Distributed leadership

becomes susceptible to power plays and can

ultimately lose effectiveness. Distributed lea-

dership is easily lost, and this represents a crucial

challenge to organizations. To prevent distribu-

ted leadership from fading away, centralized

leaders should foster values of care in the

organization [30]. The development and com-

munication of a long-term vision and shared

team goals reinforce individual ownership,

establish trust among team members and ulti-

mately lead researchers to show a greater deal of

care for their work and colleagues. Care fosters

more effortless sharing of knowledge between

team members and across hierarchies in an

organization. In high-care environments,

researchers help more, they support and trust

each other, they approach a problem using

colleagues’ views and adopt a more lenient

attitude toward peers’ views instead of building

up politicized ‘individual hegemonies of

knowledge’ [30]. In effect, researchers gain

freedom and confidence to share their expertise

accurately and they become willing to execute

as well as pass over situational leadership in the

team.

Concluding remarks

We summarize how the leadership framework

can be applied to drug discovery projects.

Initiation, termination and key resource deci-

sions of the project must be made at high

hierarchical levels by centralized leadership

teams. This ensures agreement on the overall

objectives and buy-in of major stakeholders. In

addition, strategic oversight and guidance at

major milestones in regular intervals must be

provided centrally. However, the translation of

the strategic objectives of the project into work

plans and practice is the responsibility of the

project team. In the team, leadership should be

distributed among experts for the discipline-

specific contributions and the core team

members who focus on the strategic deliver-

ables. The team should be able to display

entrepreneurial autonomy to improvise and

flexibly adapt plans on the basis of new, often

unforeseen results without requiring permis-

sion to deviate from predetermined workflows.

The core team should additionally ensure that

the right experts are engaged and interact with

the line managers. Together with the core

project team members, line managers should

provide an atmosphere that fosters knowledge

sharing and creation as well as a tolerance for

failure that accompanies much of the early

stages of drug discovery. They should reward

performances and behavior that are conducive

to project and team success.

We believe rethinking leadership, as illustrated

above, helps to resolve some challenges that

drug discovery organizations face today. The

dialogue between centralized and distributed

leadership addresses leadership challenges

related to the inherent complexity of drug dis-

covery, the loci of decision-making power and

conflicts of interest. Applying these principles

through pilot teams and gradually extending to

the entire organization will foster a sustainable

change in leadership. Mastering the balance

between distributed and centralized leadership

will be one of the key competitive strengths of

future drug discovery organizations.

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Acknowledgements

The authors are indebted to the drug discovery

project team members who participated in this

case study.

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Andreas Schneider1, Zeynep Erden1,Hans Widmer2, Guido Koch2,Christine Billy2, Georg von Krogh11ETH Zurich, Department of Management,Technology and Economics, Weinbergstrasse 56/58,8092 Zurich, Switzerland2Novartis Institutes for BioMedical Research,Fabrikstrasse 2, 4002 Basel, Switzerland