I had a couple of positions I needed to fill quickly, so I called an old semiconductors buddy to interview for one of them. He had the skill set we needed for the role, but what I really wanted was to have him make the rounds in my new company to see if he picked up on my feeling about biotech. He was a straight-shooting operations-minded veteran and I wanted his take on the situation.
The interview process included long discussions with the heads of manufacturing, quality, and technical services. At the end of his day of interviews, we went to dinner to debrief—just the two of us. Once he had settled down with a drink, I asked what he thought. He set down his pint and wiped his old-school mustache with the back of his hand. Then, true to form, he cut to the chase. He shook his head, sighed, and said, "Chris, these guys are really smart . . . but they don't know how to make stuff."
It wasn't a shortcoming of this particular biotech. Frankly, they led the league in everything important at the time. Instead, this was a shortcoming of a technical industry still early in its lifecycle. In the early days, technology companies have implicit operating principles around excellence in science and engineering. But as companies mature, too many of them fail to draw the line and formally enter the realm of those who "make stuff." To make the transition effectively, it's important to understand the operating principles for making stuff well.
The technology companies that have learned how to make stuff well have adopted four such operating principles, which I will explain.
RECOGNIZE PERSONNEL MANAGEMENT AS A REAL JOB
The highest priority for a company that is focused on execution is personnel management. Across technical industries, there is a tendency to hire and promote based on technical expertise and to largely ignore management skills. It's easy to see how this happens. Most companies fail to recognize that competence is domain-specific and that top performance as a scientist or engineer says nothing about one's ability to manage people. Most companies still look at good technical performance as an indication of some sort of enlightenment that results in the person being great at everything. This extrapolation of technical competence into non-technical areas is a problem. Believing that technical competence is an indication of managerial competence is the same as assuming that golfing great Phil Mickelson must also be a great singer. If we look to the companies that are good at making stuff, they identify a core set of management skills and make sure everyone has them.
The hard part is acknowledging that something non-technical can have a significant impact. In biotechnology, we still have a cognitive bias away from non-technical solutions, so it's difficult for many site heads and leaders to acknowledge the impact of management skills.
A majority of managers in our industry do very little personnel management in their current roles. Instead, they are called on to continue carrying out their roles as technical experts and individual contributors while also having a group report to them. When I begin working with a client's managers, one of the first things I hear is that the manager doesn't have time for things like one-on-one meetings with direct reports. In other words, a majority of biotech employees have no meaningful connection with their bosses. This in turn means that our teams are not engaged and our organization is underperforming.
When a company recognizes that it is in the business of making stuff, then it focuses on execution, which is tied directly to the effectiveness of the individual manager. For a company that wants to be operationally excellent, there is no priority higher.