There can be few more competitive markets than generic pharmaceuticals and few where so much depends on attracting and retaining specialist staff at all levels. A glance at the Sandoz website today shows people at the top of the agenda. The company, now part of Novartis following a merger with CIBA in the late nineties, owes the competitive edge it has gained from its people to a radical change process begun a couple of years before the merger.


Jacques Racloz, then Finance Director, realised that to stay competitive the company had to retain and develop its talented middle management. By changing the corporate structure to facilitate decision making as low down the management scale as possible they aimed to provide better motivation and experience while also cutting costs.

Racloz points out, "This was much more than a change in the organisation chart. Managers in the new structure needed an appropriate level of support. We needed to create a multi dimensional structure to achieve this, optimising the expertise we already had at the top of the company in more effective ways. This was clearly no time for a ‘canned’ solution. The proposed change went to the heart of the organisation and needed to be carefully constructed and marketed to prove attractive to the existing staff."

Racloz chose Eddie Obeng of Pentacle to help tailor the new look.


With clear and generally acceptable aims in view but a massive culture shift necessary to achieve them, Pentacle impressed by first doing a lot of listening. The next stage was to divide the change management challenge among small teams of managers, providing them with a set of innovative project management tools and the objective guidance necessary to identify for themselves the consequences of achieving the objectives and of not achieving them.

To stay competitive the company had to retain and develop its talented middle management

Thus motivated, Pentacle’s project management methods helped them to focus on the obstacles to progress and how to overcome them. The result of this process was a proposed structure aligned behind product / disease types.

Before this process could be completed the merger took place. Racloz points out, "It was a big shock. We were already grappling with major culture change and mergers inevitably involve a degree of culture clash. Novartis was a paternalistic company. While this can be positive with the right injection of empathy, the initial months were tough, particularly as a traditional consultancy approach was taken, with the focus on structure first and the process of getting there secondary."

"Sandoz was the only Novartis subsidiary taking this completely new approach. They realised there was a need for change and the merger offered the ideal opportunity but we were certainly taking people out of their comfort zone. In the end, the fact that we had already made a successful start and were getting early results and buy in using the Pentacle methods won the day. Inevitably there had to be compromise but we’d gone too far to go back to the old ways and people were able to see the benefits of the new type of operational structure."


Novartis adopted many of the approaches, including the multi dimensional product group divisions, each with its own budget for central services, such as accountancy and people development, a three man mini board and decision making taken at the lowest level possible. While this involved major change it is now paying dividends in terms of the speed and quality of decision making, cost effectiveness and the ability to attract and retain the best talent in the industry.


For further details please contact Sheila Hart on 01386438681/ 07786266585

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