Outsourcing: The courage to partner
Pennsylvania BIO sponsored a panel discussion on best practices in outsourcing, chaired by Patrick Lindsay, EVP of UBC. Experienced executives from a few of the area's top companies, like Daniel Carbery, SVP of ENDO Pharmaceuticals, Gerri Henwood, CEO of Garnet BioTherapeutics and Marcel Willmer, SVP of BMS, were invited to share their wisdom. While focused on "business issues," most of the panellists focused on "people-issues" when they talked about what it takes to make a partnership work. Their advice?1. Choose outsource partners based on their competence, track record and expertise, not just a favourable price. Low-cost providers who do not have depth of experience or the right infrastructure will end up costing more later, particularly if their shortcuts jeopardise GMP or GCP compliance or if they take too long to deliver the goods. It may take courage to tell the board that you spent more -- or to choose a boutique specialist rather than the big name -- but due diligence will almost always pay dividends, if your outsource partner does the job right.
2. Pay attention to people-chemistry. If a key member of the outsource team rubs your team the wrong way, address the situation swiftly." It may take courage to confront problems when your data are gut feelings and hunches, rather than mistakes or failures, but personality dynamics and the team chemistry are key factors that make or break the partnership's success.
3. Understand that both parties need to profit for the partnership to continue. It is tempting to take care of your own business and expect your outsource provider to take care of theirs. That is, until you pay the price for their miscalculations. Even if you are the customer, learn about the outsourcing provider's business model and know how they make money, to be sure you are offering a win/win business proposition.
4. Listen to the experts whom your outsource provider brings to the table. Many outsource companies can site painful experiences where they were treated only like an extra pair of hands, when their expertise, counsel, warnings and recommendations were ignored, to the detriment of the client's interests. If you are selecting based on competence and expertise, rather than price alone, your outsource partner should have experts who can augment your in-house know-how. It takes courage to admit when their experts know more about CMC or GMP compliance or about factors that will impact patient recruitment.
5. Communicate, communicate, communicate -- not just when problems arise, but early and often. They talked about the importance of transparency, about using multiple channels of communication -- that include telecons, face-to-face meetings, email and web-based information exchanges. They talked about the importance of understanding the other party's thought process and anticipating their needs, not just sticking to the terms of the formal contract.
As experts in human factors like these, we often are called in to do "teambuilding" when there are partnership issues or communication issues within a project team or between contractors and outsource partners. The investment pays off when it is better to fix problems than it is to start over with a new outsource partner. But, as these panellists noted, it is better to build a solid partnership from the very start of the outsource relationship rather than fixing it later. Some of the issues can be addressed in the contracting stage. And the kick-off is a great time to set groundrules, clarify roles, affirm shared values, to take stock of the expertise on the joint project team, and to bridge personality or cultural differences.
Thanks to Patrick Lindsay of UBC and to Pennsylvania BIO for bringing this expert panel to its members -- and for making it clear that healthy outsourcing partnership is a team relationship amongst human beings, not just a contractual economic exchange.
For more information about Pennsylvania BIO and their 2009 Conference on the 16-18 November, click here.
For more information about team mobilization and strengthening partnerships to execute new strategies, click here.
Click here to join our blog and offer your perspective on partnering. How can the foundations be laid during the contracting stage or the start-up phase of a partnership?
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