Developing leaders under siege

A well structured development programme can turn employees into successful leaders. But when a pharmaceutical company attempted to implement this type of scheme, it was not expecting to find itself in the middle of a hostile take-over bid. Stephen John explains how the dream of creating a change-agent community was kept alive by employees who refused to stop networking and knowledge sharing.

A global pharmaceutical company (APC) committed to becoming a top five company in the industry, decided to formulate a strategy to achieve this. Part of this strategy was to develop a cadre of global business leaders who would then transform the functions, structures and operations of the organisation. The proposed transformation would recognise a significant change in people’s thinking and behaviour across all parts of the European-based organisation.

In part one of this article, we discussed how global leadership education would help prepare the organisation for its role within the industry. [1] In mid-January 2004, Group 2, which completed this two-week leadership-development programme, had committed itself to forming a change-agent community that would serve those parts of APC (functions and countries) that couldn’t afford expensive consulting advice to identify and complement the changes necessary in their area.

As noted in part one, the e-room was up and running to support the change-agent community by mid-February and Group 2 was ready to start helping the entire APC organisation transform itself.

Fate takes a hand

In late January 2004, the management of APC notified its employees that a hostile bid to take over the company had been submitted by a competitor. The company immediately formed a defence committee and formulated a strategy to protect its shareholders, stakeholders and employees. The defence strategy would require the efforts of all business leaders and employees: each would play a role if APC was to successfully defend itself.

Senior management would focus on defining the threat to the company, working with the competitor markets throughout the world and communicating to all employees their progress in an open manner and on a regular basis.

Functional and regional business leaders and managers were asked to remain focused on existing objectives, to continue to do business as usual, to hold communication meetings with their employees, and, most importantly, to continue to progress with ongoing projects. All new projects, such as the change-agent community envisioned by Group 2, would be put on hold for the immediate future.

The organisation defended itself vehemently over the ensuing months, yet by summer 2004 the acquisition of APC was approved by its stakeholders. Despite the acquisition, Group 2 refused to go quietly into the night.

What Group 2 did

The dream of a change-agent community serving all of APC was still alive. Senior management had requested that business leaders focus on their functions and countries during the defence period. Several things emerged from Group 2 during this period of approximately five months:

Sub-networks formed around functions. Participants from all locations were connecting and encouraged to share information about how they were applying the leadership skills learnt during weeks one and two of the programme;
Several participants who led the formation of the change-agent community at the end of week two in January stayed connected. They shared the successes and failures of their peers who they did not connect to as described above. This led to the lessons learnt in the sub-networks being distributed across the larger group of participants;
Individual change agents surfaced from Group 2 that, because of circumstances related to their function and region, required them to step up quickly and make themselves more visible in their part of the organisation.

Individual change agents surface

The stress levels in the countries and functions were high during the defence period and, without leaders, business operations and results would have been debilitated. As I spoke with employees across the organisation, the names of participants from Group 2 emerged. A number of things were mentioned consistently across the countries/functions:

Country/function senior leadership felt under siege – all of their good work was at risk if APC lost the hostile bid. Financial results would have to be top notch if the defence strategy was to be successful. Senior leaders were also required to communicate the progress APC was making with its defence to its staff;
Work teams were under a great deal of pressure to deliver top-notch results to their senior leaders. At the same time, these work teams were aware that they were being acquired and would lose their jobs as a result of the take-over;
Directors and senior directors were visibly leading the defence and business-as-usual strategy – Group 2 were beginning to surface as effective change leaders.

Each country/function would fight for APC to remain an independent company. The hostile nature of the bid, as well as the assessment of the differing cultures, served to fuel the defence efforts. Alongside individual change agents in different parts of the organisation, Group 2 was making critical contributions to the defence effort.

What happened

APC lost its battle for independence in summer 2004. As a result, the building of a cadre of global business leaders was put on hold. The new integrated company would determine what skills their business leaders would need, when they would develop these skills and who would receive this development. It would be early 2005 before all this was finalised. Group 2, however, refused to stop practising the change skills it had learnt and was committed to using in the organisation.

A case in point

One of the more challenging aspects of integrating two large, geographically dispersed organisations is connecting its information-technology platforms. While extremely difficult to do, this was critical for the IT function to quickly assess current and future needs, evaluate each company’s existing technologies and recommend an effective solution.

With a combination of the high risk of failure and the political minefield, this was a very ambiguous environment for business leaders to find themselves in. E-mail, voicemail, electronic directory of personnel and intranets would all have to be integrated within the newly merged companies from day one. Each company had substantially different technology platforms, architectures and policies. Leaders would have to assess the technolgy, provide solutions, sell to top management and lead implementation teams that were used to only working in their company’s technology environment and culture as quickly as possible.

Group 2 had identified a number of information-technology professionals from various functions and countries. Their sub-network kicked into high gear. They connected virtually, formed a technology plan and, most importantly, a change plan, for consideration by the integratio-team leaders. They asked each local technology professional to reach out to their counterpoint in the acquiring company and start discussions about strategy, process and implementation of merged systems. The Group 2 change agents then connected the sub-network into a single network that supported both companies. Day one saw employees of both companies able to connect via e-mail, voicemail and the intranet.

In following up with change integration team members, Group 2 change-agents had this to say: “Thanks to the leadership-development experience and my network from the session, I quickly understood the impact of integration across functions and countries. I used the change situation-analysis tools that we were taught to use; drafted a strategy and implementation plan; took the lead and the risk – fought the maysayers and led a cross-organisation team to integrate the systems architecture on time, at high quality and at low cost. We now have a much larger network of IT professionals in the new company”

What’s ahead

The new company is moving forwards to integrate functions and implement its strategy, and aims to be up and running as one company by January 2005.

The new company is committed to developing its people at all levels of the organisation and to supporting change leaders across the organisation. Group 2 business leaders have a head start – they saw themselves as change agents when they left their programme in January 2004. They have been tested by events since then and have passed with flying colours. Their network is strong and growing on a daily basis and they are sharing the lessons they have learnt with all they come into contact with.

Personal reflections

One of my hopes, when I see participants leave a leadership-development session, is that they will be able to use what they have learnt in the real world and to share their skills with others. I was initially disappointed that Group 2’s vision of supporting APC’s countries and functions as change-agents was scuppered by the hostile bid and defence initiatives. I can still feel their passion in the room as we closed out week two in January. I was witness to their enthusiasm: the idea of becoming a change-agent business leader had motivated and stimulated them.

We are now in the process of considering what form global leadership education should take in the new company. There are of course differences in terms of business vision, philosophy, guidelines and processes, as well as the education of its business leaders. I am confident that we will work through these differences and that the best is still to come.

Reference
1. John. S., ‘Business transformation through leadership development’, in Knowledge Management, (Ark Group, Volume 7, Issue 8, 2004)

Stephen John is head of global organisation effectiveness and leadership development at a global pharmaceutical company. He can be contacted at stephengjohn@aol.com