“Throwing middle management into the deep end after deciding to outsource, without re-defined processes and appropriate training and tools, is not proving to be very effective.”

As we slip into the modus vivendi of outsourcing most or all of clinical development, a full appreciation of the consequences is still missing at many sponsors.

The most important, and apparently surprising, lesson sponsors are learning is how much work outsourcing takes, when the point was to eliminate the work altogether! Short of reversing the outsourcing course (which I am pleased to see is slowly starting at some companies), the next best thing for us to do is analyze closely the operational opportunities to improve the performance of outsourced trials. Unsurprisingly to students of organizational change, both the risk and the opportunity lie with middle management.

Biopharmaceutical sponsors have seemed to react to suboptimal outsourcing from two extremes. One response is that we’ll work it out on the golf course (executive to executive, in the classic pas de deux where both parties are fatally dependent on each other). At the opposite end, a common solution for biopharma is we’ll shadow our service providers hour by hour, and second-guess them to the point of doubling the effort and cost expended, to no benefit of quality or speed.

What makes most businesses work is the middle: middle management is the forgotten, thankless job that sponsors, having already lopped off the lowest doers, are now energetically bulldozing. This leaves a dangerous gap – the management gap, or put another way, the knowledge gap – where the most important locus of performance assurance lies.

The gap in knowledge of how to effectively run clinical development is plaguing sponsors and service providers alike. The emphasis for both parties has been to maintain scientific and functional knowledge, which is essential. But without sufficient knowledge on how to operationalize the science, sponsors become overly reliant on the service provider, or worse impose suboptimal procedures on the service provider (from ignorance or overwork), which leads to conflict, issues and a deteriorating relationship.

The same characteristics of a healthy in-sourced model apply to effective outsourcing: senior management must provide their people with the resources, guidance and support that will lead to success. Too often the concept has been to assume that the service providers will handle everything – an abdication of responsibility. Throwing middle management into the deep end after deciding to outsource, without re-defined processes and appropriate training and tools, is not proving to be very effective.

The Missing Managers

The competency gap comes from a logical sequence:

• Large-scale outsourcing programs cannot be cost-justified if too much infrastructure is left in house.

• Service providers recognize the need to reassure their customers that all will be taken care of in order to win large-scale contracts.

• As departments are decimated, middle managers leave or are let go.

• The normal cycle of learning by doing, and passing it on to newcomers, is dangerously broken.

Service provider middle managers are also endangered by too high expectations. Left alone and in charge, they are trying to manage development programs which need a sponsor’s product-driven self-interest, but from the well-intentioned position of an output-driven factory floor supervisor.

An obvious fix is to improve the quality of service provider middle managers, but service providers have the same problem sponsors do – where do we find the knowledge and talent? The pool of experience is drying up by the day, and both sponsors and providers have widespread problems in hiring. I like to say the challenge in clinical research is not QA (quality assurance) but “CA” – competency assurance – a much harder challenge. With good pre-hoc CA, we can avoid post-hoc QA problems.

And to add to the dilemma, both sides’ middle managers have the added burden of becoming expert both in their particular research function and also at communicating and working with their counterparts. So even in the best case scenario of two sets of fully-funded and well-meaning middle managers, there is often a critical communication skills gap.

We may have to look outside the industry to get the next generation of managers. It may be easier to teach a talented manager about clinical research, than make an effective manager out of today’s overworked and undertrained staff.

Filling the Gap

There are a number of actions that both sponsor and service provider can take to try and fill the gap. First of all, recognize that the basics of management are harder with outsourcing. Motivating people who work for someone else, with different business objectives, is hard. Correcting their under-performance is even harder.

Secondly, adapt and revise internal departmental and trial conduct processes when outsourcing. Internal processes assume short hand-offs between people who know each other personally. When working only internally, misunderstandings can be clarified relatively easily, because face-to-face contact is so much easier to accomplish, and more frequent. Not so, when the service provider personnel are ten time zones away.

Third, devote time and effort to training middle management on the soft skills required to manage service providers (and for service provider managers to serve their customers). This type of management is very different from managing internal resources – for instance, should you say the same thing in the same way to a direct report or colleague within your company, as you should to your customer or provider?

Overall, maintain and nurture your middle manager staffing. If your budget savings weren’t realized in firing the low-level transactional workers, they are not going to come from firing their managers too – a classic case of cutting off your nose to spite your face. Ensure that internal staff learn, maintain and retain clinical development skills. Focus your governance time and efforts at the operational level, not on remote steering committees, and renegotiate the service provider relationship so that both sides are encouraged to invest in the quality of middle management, and adjust expense/funding/budgeting expectations accordingly.

Biopharma clinical research management should consider the wisdom of the London Underground: mind the gap! In our case, it is the gap of knowledge, manpower, process and oversight between the strategic ideas of customer and service provider. If we step too late, we will be falling onto the third rail of an empty track.

“The problem lies not with the new process, but with the old people.”

I have had a peek into the fantasy life of clinical development executives. It is not pretty. Not the kind of fantasies you might imagine – more like fifty shades of self-delusion. The fantasy goes something like this: clinical development is inefficient, a performance drag to drug commercialization – it is no faster than a caterpillar moving along a tree branch. By some form of magic (“extra-lean sigma”, or outsourcing, or motivational posters in the hallways), the caterpillar will turn into the beautiful butterfly that C-officers and stockholders want to look at. This metaphor is precise, because management wants the same development staff to transform themselves from caterpillar to butterfly, without making any meaningful (and painful) changes to people or process. I have been calling this fantasy goal, perhaps too politely, “transforming in place” – that somehow we can change what we do, and how we do it, without making the tough choices. Referencing our butterfly metaphor, I think I will call it “the chrysalis fallacy.”

It is most distressing to see organizations invest heavily in a high-level strategic review, or new information technology, or a major shift in resourcing, after which they then exhibit very little change in their fundamental performance. Often, the problem lies not with the new process, but with the old people.

Most biopharmas have people in place in clinical development, especially in management, who have been in their positions for many years. When confronted with changes in process, technology or strategy, they are naturally resistant. Their managers, in turn, are reluctant to push too hard on these managers because of various reasons: it engenders a difficult conversation, it requires lots of follow-through (and therefore continuing discomfort), or the managers also may not embrace or understand the change. The resistance is not remarkable. What is remarkable is how frequently biopharma development is in a turmoil of change, and yet rarely replace the people in pivotal roles responsible for the change.

There are many examples of process, technology and strategy changes facing us. Reducing source data verification is a big process change; introducing information technology like a new CTMS, web-based subject randomization, or an electronic master file, is highly disruptive; a change in resourcing strategy to more (or less) use of CROs or more (or less) use of functional in-sourcing is an increasingly common, threatening situation.

These changes can be implemented successfully, if not painlessly, even with all the current staff in place. But usually, one or even many key staff are resistant or incapable of managing in the new environment. This is understandable, but must be corrected. Nothing protects people in place like history, loyalty, avoidance and fear. If you or your company have worked with someone for many years, you naturally resist asking that person to leave his or her position. Indeed, there may have been many glorious achievements that they were once responsible for. We feel loyal to people who have performed for us in the past, “watched our backs,” maybe even hired us. Most commonly, we leave people in place to avoid the unpleasantness of trying to move them out, and usually, the company’s policies or national employment laws make the task even more arduous. Last but not least, there can be considerable fear in the situation: how will things work without the people in place who always did the job in the past?

Why can’t we avoid the pain and just leave underperformers in place? The consequences are deadly. The reader will recognize these examples:

— A clinical development executive spends millions with multiple consultants on a “best practices” strategy, but operationally nothing changes

— The latest clinical supplies tracking technologies are employed and a fatal error still ruins a trial

— Another clinical development executive tells her management team the kinds of changes she wants to see, “empowers” the same culpable managers to implement them, and then wonders years later why nothing improved

— A pharmacovigilance department installs the latest technology but the managers insist on using the traditional paper-based processes anyway

— A clinical monitoring leader simply rejects new processes, intimidates his staff, passively ignores the imperative to change, and through inertia, is able to successfully kill the changes over time.

Some people can change, and some people should be given the chance to shine elsewhere. In some cases, people previously stuck in old ways can prove to be highly valuable in a completely different department. In other cases, the classic move of shifting a failing people manager to a newly created position as a senior individual contributor can create a highly productive employee. Freed of daily production responsibilities and their own petrified loyalties to those underneath, they have the time and responsibility to contribute in an entirely new means.

Improving efficiency or timeline performance in clinical development requires considerable alteration in the way we have been used to working. But the chrysalis fallacy whispers that we need not rock the personnel boat; the butterflies will fill the office. It’s a beautiful idea, but probably a fantasy. Get real. Forget the caterpillars and find new worker bees. This metaphor may be mixed, but the results won’t be.