Ms Laura Thomas Managing Director, RSA Singapore

Aug 2010: The global pharmaceutical and biotechnology industry typically responds to an economic downturn by downsizing its talent pool; although the 2008 global financial crisis did not result in layoffs within Asia’s biomedical sector, many companies saw headcount freezes and salary reductions. This was generally more severe within drug discovery and pre-clinical R&D departments with management choosing to shift resources to the development of later stage compounds in order to increase market share of the company’s existing products. While this approach may result in short-term gains, it potentially produces long-term damage for R&D-focused organizations.

With the current European crisis casting a bleak global outlook, how will your organisation react?

Short term gains result in long term pains
Let us first take a look at why reducing recruitment activities is not the way to go. Slashing research and pre-clinical development headcount means that companies will be cutting down on early stage R&D activities resulting in quickly vanishing new product pipelines. When the economy rebounds, these companies will find themselves vulnerable, as patents on existing products expire and sales volumes drop due to cheaper generic alternatives or competing products entering the market. Furthermore, those businesses that need to restart recruiting or retaining senior level R&D executives to drive innovation and rebuild product pipelines will be at a disadvantage.

Forward-looking R&D companies believe that during difficult economic times it becomes even more critical to retain, motivate and develop top scientific talent. They recognize that it is these individuals who will make a difference to the organization’s long term success. The strength of a company may be boosted during a downturn as it continues to lead the drive for future innovation and invigorate its product pipeline.

 Myths, realities and solutions

Reality—As discussed earlier, top performers will always have opportunities, regardless of the economic climate. If they are not treated well by their employers, they might simply leave. Even if this does not happen immediately when fewer jobs are available, they might move on later, when the economy picks up. This means that the company will lose its best R&D executives at a time when it is gearing up to capitalize on the economic recovery.

Solution—During tough financial times, it is difficult for companies to use equity, hefty bonuses and large pay increases to retain their top R&D executives. Therefore, they must find more creative mechanisms to incentivise and retain their staff. Ongoing and consistent communication from the top is a key retention tool, reminding the discovery and pre-clinical R&D staff of the value they bring to the business. This is particularly important during times when the focus of the company turns to later stage projects and marketed products. If there have been lay-offs or salary reductions, employees may feel undervalued, demotivated and overstretched. They may also not be able to see clear steps ahead for career progression. Companies must find ways to continually develop their future scientific leaders. This could be through the use of "stretch" roles or secondments to other departments.

—Recruiting top R&D talent during a recession will be easy. There are lots of candidates and few opportunities available–so what is the problem? —The most innovative, strategic and visionary pre-clinical R&D executives and scientists will remain employed, even during the deepest global recession. However, recruiting senior level executives will become more difficult, as those who were once readily open to exploring alternative career opportunities are now more cautious. Generally, people prefer to stay with their known, secure organization, rather than taking the risk of moving to a new one. This is even more noticeable for Asian biomedical sciences organizations trying to recruit international experts from the US or Europe. —During a downturn, companies need to work harder to attract and recruit the best candidates. Candidates will increasingly make decisions based on the perceived stability of the organization and on the career advancement opportunities the role offers. Recruitment and selection is a two-way process. So hiring organizations need to differentiate themselves from competitors and put in a concerted effort to "sell" the opportunities presented by the company and the role. Employers must demonstrate a consistent and genuine interest in the candidate, leaving them in no doubt about the desire of the senior management team to bring them on board. During a recession, companies do not need to put in resources into retaining their top scientists and scientific leaders. There are few jobs out there – so where will they go?

—Recruiting top R&D talent during a recession will be easy. There are lots of candidates and few opportunities available–so what is the problem? —The most innovative, strategic and visionary pre-clinical R&D executives and scientists will remain employed, even during the deepest global recession. However, recruiting senior level executives will become more difficult, as those who were once readily open to exploring alternative career opportunities are now more cautious. Generally, people prefer to stay with their known, secure organization, rather than taking the risk of moving to a new one. This is even more noticeable for Asian biomedical sciences organizations trying to recruit international experts from the US or Europe. —During a downturn, companies need to work harder to attract and recruit the best candidates. Candidates will increasingly make decisions based on the perceived stability of the organization and on the career advancement opportunities the role offers. Recruitment and selection is a two-way process. So hiring organizations need to differentiate themselves from competitors and put in a concerted effort to "sell" the opportunities presented by the company and the role. Employers must demonstrate a consistent and genuine interest in the candidate, leaving them in no doubt about the desire of the senior management team to bring them on board. During a recession, companies do not need to put in resources into retaining their top scientists and scientific leaders. There are few jobs out there – so where will they go?

—Recruiting top R&D talent during a recession will be easy. There are lots of candidates and few opportunities available–so what is the problem? —The most innovative, strategic and visionary pre-clinical R&D executives and scientists will remain employed, even during the deepest global recession. However, recruiting senior level executives will become more difficult, as those who were once readily open to exploring alternative career opportunities are now more cautious. Generally, people prefer to stay with their known, secure organization, rather than taking the risk of moving to a new one. This is even more noticeable for Asian biomedical sciences organizations trying to recruit international experts from the US or Europe. —During a downturn, companies need to work harder to attract and recruit the best candidates. Candidates will increasingly make decisions based on the perceived stability of the organization and on the career advancement opportunities the role offers. Recruitment and selection is a two-way process. So hiring organizations need to differentiate themselves from competitors and put in a concerted effort to "sell" the opportunities presented by the company and the role. Employers must demonstrate a consistent and genuine interest in the candidate, leaving them in no doubt about the desire of the senior management team to bring them on board.

The way ahead
Even as companies focus on short term objectives, they must keep their longer term goals and aspirations in mind. Strategic organizations plan their hiring needs and focus on predicting requirements for the future. These organizations conduct internal talent reviews and external benchmarking activities, to ensure that they have the appropriate staff on board to take the company to the next stage. Companies that continue to focus on recruiting and retaining talent during an economic downturn will emerge with a strong R&D leadership, capable R&D teams in place and their product pipelines intact, positioning them well to benefit quickly from the recovery.