Skilled biopharma leaders are in high demand. But skills are only part of the story. Even the most accomplished candidates on paper will struggle if they aren’t closely aligned with the culture of their companies. The attached paper looks at the importance of culture in a Volatile, Uncertain, Complex and Ambiguous (VUCA) environment. By Dr Niren Thanky, Global Healthcare & Life Sciences Practice, nthanky@heidrick.com

1. HEALTHCARE AND LIFE SCIENCES PRACTICE
Culture’s critical role
in pharma leadership
Skilled biopharma leaders are in high demand. But
skills are only part of the story. Even the most
accomplished candidates on paper will struggle if they
aren’tcloselyalignedwiththecultureoftheircompanies.

2. The level of complexity in global business
continues to rise, driven by an increasingly
competitive landscape in which known
and unforeseen factors can affirm or
undermine strategic decisions at a
moment’s notice. Consequently, senior
executives are under pressure to navigate
pitfalls, identify and pursue opportunities,
and through it all continue to provide
strong leadership. Among the more
challenging industries for leaders today
is biopharmaceuticals, where executives
must balance multiple and sometimes
colliding forces, lead through transitions
such as M&A, and make“bet the
company”decisions on R&D investments.
Tested leaders have never been at a
greater premium.
Moreover, these leaders increasingly require new skills,
including the ability to envision how trends and contexts
may intersect and change direction — what we call“ripple
intelligence.”(For more on the skills that senior leaders
need, drawn from our research with the University of
Oxford’s Saïd Business School, see sidebar,“Key findings
from The CEO Report.”)
But skills are only part of the story, as even the most
accomplished candidates on paper will struggle if they
aren’t closely aligned with the culture of their companies.
Companies that have a quantifiable appreciation of their
organization’s underlying culture, including a detailed
understanding of its strengths and weaknesses, are better
prepared to attract and retain candidates who will help the
company achieve — and exceed — its business objectives.
Key findings from
TheCEOReport
Today’s global CEOs need to manage through
unprecedented uncertainty, times that are
characterized by a combination of political, economic,
social, and environmental unrest and disruptive
technological innovations. Heidrick & Struggles, in
partnership with the University of Oxford’s Saïd Business
School, recently interviewed 150 CEOs across six sectors
from around the world. Our findings were published in
The CEO Report: Embracing the Paradoxes of Leadership
and the Power of Doubt, which underscored the need for
current and future CEOs to be flexible, systemic thinkers
who are comfortable with uncertainty, complexity, and
constant change.
The ability to predict how trends and contexts may
intersect, interact, and change direction to form new
opportunities or threats requires a step change in CEO
and C-level behavior. Our analysis found that executives
must be able to lead in ambiguous situations,
harness the power of doubt, remain authentic, and
connect seemingly unrelated events through a skill
we call“ripple intelligence”— all essential qualities
for harnessing competitive opportunities in today’s
global economy.
Download the full report at www.heidrick.com/
theceoreport
2 Culture’s critical role in pharma leadership

3. Distinctive leadership in
uncertain times
Biopharma companies have been pursuing several paths
to boost revenues and improve shareholder value. Each
path increases the complexity for executives, who must
balance a diverse array of often competing factors to meet
the company’s aspirations. Following are some of the
paths that biopharma companies are taking.
The urge to merge
Acquisitions in biopharma have been on the rise, with
total M&A activity exceeding $200 billion in 2014 (see
figure). Thus far, 2015 appears likely to be a year of robust
and highly competitive M&A as well, as companies seek
to jump-start growth and innovation. Executives are using
M&A either to develop franchises in new therapeutic areas
or to bolster their presence to become market leaders. Of
course, capturing postmerger value is a daunting task that
requires savvy leadership: executives must be authentic
and adaptable to lead effectively and unify the company
around a shared vision.
High-stakes R&D
The global biopharmaceutical industry has among the
highest R&D spending of all industries. These outlays
also generate the greatest rewards, as measured by
patient outcomes and financial returns for shareholders.
According to the Tufts Center for the Study of Drug
Development, developing a new medicine and gaining
market approval can take as long as a decade and cost
as much as $2.6 billion. Gaining market approval is only
the beginning; biopharma companies must then secure
appropriate reimbursement for treatments in different
healthcare systems around the world. CEOs who can
develop — and use — ripple intelligence to identify the
most promising therapies can deliver the greatest returns
over the long term.
New therapy areas
Companies often move into different disease categories
in search of competitive advantage. The fields of oncology
and immuno-oncology, for example, have attracted the
most new competitors — and the most uncertainty. This
particular therapy area has benefited from increased
knowledge of the underlying disease pathways, which
enables better disease classification and the development
Biopharma M&A transaction volumes, United States and Europe, 2012−2014
Completed deals, up-front transaction
volume, $ billion
Up-front deal volume of announced deals,
$ billion, 2014
2012
43.0
2013
48.5
2014
81.8
10.4
21.3
13.4
32.6
27.2
68.4
Acquisitions in rest of
the world
Purchase of assets/divisions,
US and Europe
US companies acquired
European companies acquired
Announced acquisitions,
US and Europe 78.8
Total 219.4
45.6
13.3
Source: HBM Pharma/BiotechM&AReport2014
Figure
Heidrick & Struggles 3

4. of biomarkers and diagnostic tools, resulting in more
competitive interest and better clinical outcomes.
However, recent spending has moderated due to fewer
breakthrough therapies for large groups of patients,
patent expiries, the reduction in the use of supportive care
medicines, and better payor management.
Each of these strategies can deliver significant returns
over a period of years — if biopharma companies have the
right leaders at the helm to execute them as well as strong
organizational cultures that encourage the mind-sets and
behaviors required to succeed.
Biopharma’s“must-
have”skills
To get a deeper understanding of the biopharma industry
and its talent needs, we interviewed executives and
non-executives from about 30 large-cap pharmaceutical
and biotechnology companies to understand their views
on how to successfully implement company strategy.
Respondents acknowledged that understanding their
own company cultures first would enable them to make
more informed decisions about external hires and internal
development opportunities for future C-suite leaders.
Participants also agreed that better differentiation of
executives who can adapt and lead in volatile, uncertain,
complex, and ambiguous (VUCA) situations would provide
enduring advantages.1 Executives in the biopharma
industry must manage a wide range of internal and
external factors, many of which — for example, regulatory
approvals — are well beyond their control. We have
found that successful leaders view these factors along a
spectrum and assess their positive and negative qualities
to get a sense of their value or risk to the organization.
The best executives work to maximize the positive while
minimizing the negative characteristics at both ends of the
spectrum. All embrace a personal and professional mind-
set of continuous learning.1
1 For more about leading in VUCA environments, see “Sculpting
tomorrow’s ‘borderless’ leaders,” on heidrick.com.
Culture’s critical role
Companies pursuing growth strategies often hire a leader
to catalyze change or reorient the organization. Each
situation calls for a leader with a particular set of skills and
experiences to rally employees around a common vision.
Given the pace and continued acceleration of deal-making
in the sector, the difficulty in finding the right leader will
only increase.
The difference between a good and a great biopharma
executive placement is often determined by cultural fit.
Therefore, it’s critical to take into account the unique
culture that an executive will join and how the new
executive will respond to it. Since biopharmaceutical
companies are by nature created by experts working
together in a tightly woven culture to translate intellectual
property into clinically viable products and services, the
culture of these organizations can be either a driver or an
impediment to execution and success.
After all, biopharma companies may have vastly different
cultures depending on their size and maturity: smaller
businesses, we find, often exhibit a strong sense of
purpose, embrace an entrepreneurial spirit, and have
close-knit teams that serve to amplify diverse (and
sometimes difficult) personalities. By contrast, larger
companies tend to have a more“command and control”
culture as well as more defined organizational
structures and departments that operate independently —
sometimes to a fault. Employees in these firms tend
to enjoy more job security, although they often report
trading this benefit off against the frustrations of
executing in large and generally unwieldy corporate
environments.
As these examples suggest, having a better appreciation
of different leadership styles and cultural orientations
helps companies understand the sorts of environments
in which a given executive might thrive. Indeed,
finding the right leader isn’t just about experience or
an impressive track record but an executive’s ability to
adapt to — or shape — the culture of a given company.
For example, taking a command-and-control approach
4 Culture’s critical role in pharma leadership

5. at a smaller company could be met with indifference or,
worse, outright mutiny. Therefore, strong direction and
communication from the top is required to implement
large changes. In any environment, successful leaders
must be able to connect mosaics of information in order to
create a compelling vision of the future and galvanize their
teams around a common sense of purpose.
Matching leaders to the
company’s culture
In our experience as leadership advisers, we know that
senior executives can fail to perform for a variety of
reasons. Understanding leaders’personal“derailing”
factors and providing external coaching to accelerate their
integration and long-term retention greatly increase the
chances of success. By taking three steps, companies can
improve the odds of attracting and retaining leaders with
the right skills to achieve business goals.
1. Understand the company’s culture. The organization’s
cultural DNA and business strategy can be used to help
identify the attributes that are unique to the company.
This assessment will help identify people with the right
skills to develop the culture or, in the case of a merger
or other growth strategy, constructively challenge
entrenched attitudes.
2. Look to the hows of leadership. Candidates can look
very impressive on paper (the whats of leadership), but,
as noted above, the type and size of the organizations
they served can elevate the importance of certain job
experiences while negating the impact of others. A
review of each company and its strategy during the
candidate’s tenure can shine a light on his or her results
and leadership style and better predict how he or she
will behave in the new environment.
3. Learn how to spot the right traits in a candidate. Given
the complexity of the industry, an ability to deal with
ambiguity and balance multiple factors can be an
important indicator of future success. Companies
should seek to get an idea of how candidates would
lead in unfamiliar situations to better select those
who can harness uncertainty and use it to the
organization’s advantage.
Quantifying culture
and leadership
Even the most rigorous hiring processes can fail to
determine whether a candidate is a good fit along
intangible factors such as leadership and culture.
Therefore, to help organizations increase the odds of
success, Heidrick Struggles has developed a suite of
practical tools to help senior executives to quantify a
“Understanding leaders’ personal
‘derailing’ factors greatly increases the
chances of success.”
Heidrick Struggles 5

6. prospect’s capabilities in these areas as well as understand
their organization’s culture. For example:
Corporate Culture Profile™ is a diagnostic instrument
developed by Senn Delaney, a Heidrick Struggles
company and the leader in corporate culture shaping. It is
used with clients to measure the culture of an organization
or a specific team across five indicators — essential values,
strategic alignment, committed engagement, internal
drivers, and strengths and challenges in culture. This
online survey, along with guidance and insight on the
findings from culture-shaping experts, helps executives
understand key attributes of their culture as well as how
the culture is perceived throughout the organization.
Leadership Signature™ is an executive assessment tool
designed to provide companies with a better idea of
a candidate’s leadership style in three main categories
of attributes: potential, mind-set, and essential values.
This detailed survey places executives in one of eight
leadership patterns (such as collaborator or harmonizer),
giving companies a more holistic view of prospects to
better predict how candidates might execute specific
strategies or thrive in varying degrees of uncertainty or
complexity. For more, see our recent article in Harvard
Business Review:“Assessment:What’sYour Leadership Style?”
Executive Culture Profile™ allows companies to profile
executive candidates for culture fit and impact. It
does so by identifying two dimensions — values and
leadership behavior styles — in the cultural relationship
between candidates and the team they will join. The
resulting profiles offer insights into the team’s cultural
attributes, as well as an objective means of discussing
the likelihood that various candidates will align with,
or shift, the culture and drive desired performance
and results. The tool also offers useful information for
incoming CEOs and corporate directors to help them
avoid cultural “landmines” in their new roles.
Regardless of the growth strategies that biopharma
companies are pursuing, it’s a fact that different strategies
call for different types of leaders. Companies that seek
executives to catalyze change, for example, should
proactively use this criterion to identify candidates who
will challenge cultural norms. The trick for companies is to
recognize the attributes they are looking for in a candidate
and ensure that prospects are a good fit for their culture.
Without this alignment, even executives with a proven
track record may not be able to deliver. 
6 Culture’s critical role in pharma leadership

7. Healthcare
Life Sciences Practice
Heidrick Struggles’Healthcare and Life Sciences Practice helps leading
organizations in these sectors align their talent strategies and business objectives
to foster innovation and enable growth in a fast-moving, rapidly changing world.
Companies in the healthcare and life sciences sectors contend with ever-changing technology, patient
populations, markets, pricing, and regulatory environments. Their leaders must have the competencies
required to lead all aspects of the business, while understanding the value of innovation and the relevance of
science. With more than 80 professionals in major cities around the world, our Healthcare and Life Sciences
Practice team combines unparalleled search resources with a deeply consultative approach to help clients
boost their leadership capabilities.
We have expertise across all sectors in the healthcare and life sciences sectors, including biotechnology,
healthcare services, managed care, medical devices and diagnostics, pharmaceuticals, research and
development, and contract research.
Working closely with a broad range of clients ranging from start-ups to global public companies and
healthcare organizations, Heidrick Struggles identifies succession issues, considers team composition, and
taps nontraditional talent pools. We advise and recruit in the context of an organization’s culture. We partner
with our clients to find leaders who can align and integrate the interests of complex stakeholder groups,
build their organizations, and demonstrate shareholder value year after year.
P/HLS/15/01

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search, culture shaping, and leadership consulting services. For more than
60 years we have focused on quality service and built strong relationships
with clients and individuals worldwide. Today, Heidrick Struggles’
leadership experts operate from principal business centers globally.
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