RGP (Nasdaq: RGP), a global consulting firm, today released a new report showing that strategic initiatives in the life sciences industry are failing far too often, particularly when it comes to M&A activity, necessitating a new way of approaching them.
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RGP surveyed executives from the pharmaceutical, biotechnology, and medical device industries on the effectiveness of their strategic initiatives. These large, complex and costly initiatives can span a broad section of functions, including clinical trial operations, predictive modeling, clinical trials, supply chain issues, and leveraging generative AI to analyze data. Nearly 60% of respondents indicated that at least a quarter of these projects fell short of their goals, and nearly 30% said that most of their initiatives aimed at enhancing company performance have underperformed.
Within life sciences industries, these project challenges often revolve around M&A activity.
“Despite the volume of life sciences M&A today, few organizations consider the litany of complex tasks required to close and integrate deals as a full-blown program of projects,” said Marcia Brown-Rayford, Global Life Sciences Research & Development Leader at RGP. “M&A transactions are projects that require masterful execution to not only close these deals but to also integrate the asset, carve out people, process and technology, manage risk, and meet regulatory requirements. A lack of skilled project leadership is the main reason why many post-M&A integrations fail, with legacy companies remaining siloed, hampering return on investment.”
Most respondents agreed on the root cause of project failures, with 76% attributing them to a lack of skilled project management leaders. This growing competency gap within the industry has been exacerbated by ongoing talent shortages and the grab for qualified project managers only exacerbate.
“An alarming number of critical projects like M&A transactions are failing today and will continue to fail without effective project management,” said Brown-Rayford. “These complex transactions will remain common as large pharmaceutical companies continue seeking to fill pipeline gaps by investing in small to midsize companies.”
The workforce composition of companies in life sciences industries continues to evolve as well. Nearly 60% of North American respondents said teams composed of individuals from multiple organizations are important to successful project execution. The study also found that the proportion of external team members on transformation teams rose from 40% in 2020 to 46% in 2022 and is projected to reach 53% in 2024.
The research findings are based on RGP’s fall 2022 survey of 404 large companies with $1 billion or more in revenue, including 99 life sciences executives. Read the full report, “Why Mission-Critical Life Sciences Projects Are Failing—and How to Fix Them” by visiting https://rgp.com/now/research/life-sciences/achieving-strategic-project-goals/.
About RGP
Recently named among Forbes’ World’s Best Management Consulting Firms for 2023, RGP is a global consulting firm focused on project execution services that power clients’ operational needs and change initiatives utilizing on-demand, expert and diverse talent. As a next-generation human capital partner for our clients, we specialize in co-delivery of enterprise initiatives typically precipitated by business transformation, strategic transactions or regulatory change. Our engagements are designed to leverage human connection and collaboration to deliver practical solutions and more impactful results that power our clients’, consultants’ and partners’ success.
A disruptor within the professional services industry since our founding in 1996, today the Company embraces our highly differentiated agile delivery model. We attract top-caliber professionals with in-demand skill sets who seek a workplace environment characterized by choice and control, collaboration and human connection. The trends in today’s marketplace favor flexibility and agility as businesses confront transformation pressures, severe skilled labor shortages and speed-to-market challenges. As talent preferences continue to shift in the direction of flexibility, employers competing in today’s business environment must rethink the way work gets done and consider implementing new, more agile workforce strategies. Our client engagement and talent delivery model offers speed and agility, strongly positioning us to help our clients transform their businesses and workplaces, especially at a time where high-quality talent is scarce and reliance on a flexible workforce to execute transformational projects is increasingly imperative.
With approximately 3,800 professionals collectively engaged with over 1,900 clients around the world from 41 physical practice offices and multiple virtual offices, we are their partner in delivering on the “now of work.” Headquartered in Irvine, California, RGP is proud to have served 88% of the Fortune 100. The Company is listed on the Nasdaq Global Select Market, the exchange’s highest tier by listing standards. To learn more about RGP, visit: http://www.rgp.com. (RGP-F)
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