Pharmaceutical Market Europe • December 2021 • 36-37

STRATEGY EXPERTS

Mastering relationships

Strategy experts build trust, up, down and sideways

By Brian D Smith

This series of four articles attempts to capture and communicate the mostly tacit capabilities of a strategy expert in the life sciences sector.

Using Roger Kneebone’s framework, the first article began by explaining strategy expertise as ‘three masteries’. Article 2 then explored mastering oneself, article 3 mastering knowledge and this final article tackles mastering relationships. All three masteries are difficult, which is what makes genuine strategy expertise so rare. In particular, our industry is exceptional in the complex mixture of competencies that have to be brought together from many different functions. In practice, that means that good working relationships are essential to effective strategy making and implementation. True strategy experts master relationships by reifying the nebulous concept of relationship and applying it upwards, downwards and sideways.

Reifying relationships

Relationship is one of those English words that has many uses. It can describe anything from a marriage to a distant LinkedIn connection. But life sciences strategy experts have learned that, in their working context, a strong relationship means ‘high trust under discretionary conditions’, so it’s worth exploring what that means.
   
One of the exceptional characteristics of our industry is that it employs a high proportion of educated people to do specialised tasks. A corollary of this is that their work is highly discretionary, in the sense that exactly how and when it is done is decided by the person doing it. In contrast to a production line worker, for example, the work of a medical affairs manager or a market access director cannot be controlled by unalterable instructions and pervasive metrics. This means that working relationships have to work in this high-discretion environment.
   
Equally, trust is an ambiguous word in common usage, with connotations of unsubstantiated faith. But in the context of working relationships, strategy experts have learned that trust has a harder, more precise meaning. It is best defined as a strong belief, held equally between two people, that their values are aligned and that neither of their goals can be without the other. In contrast to blind faith, trust works on the assumption that selfishness, or at least self-interested altruism, will ensure cooperation.

So for strategy experts, especially in the life sciences industry, a good relationship isn’t simply a friendly camaraderie with their coworkers.

It is the building of ‘high trust under discretionary conditions’; the strong belief that they will work together cooperatively. Redefining the concept of relationships in this way is the foundation of managing relationships up, down and across the organisation.

‘Redefining the concept of relationships is the foundation of managing relationships up, down and across the organisation’

Relating upwards

Relating upwards – that is, building trust with those above you in the organisation – is essential for strategy experts. From above flow the resources needed to make and execute strategy. These include the tangible – such as money and people – and the intangible, such as authority and legitimacy. A weak upward relationship strategising almost impossible.

Strategy experts achieve trust between themselves and their superiors by first making sure they understand very clearly what those above them want. Then they demonstrate and convince their leaders that they are the necessary to those goals. Neither requirement is straightforward. Leaders’ espoused goals (commercial objectives for example) often hide tacit goals (such as changing company culture). Sometimes, explicit corporate goals are less important to leaders than implicit personal goals, such as their reputation in the company. The strategy experts’ task, therefore, begins with probing and inferring the full richness of their leaders’ goals, spoken and otherwise.

The second requirement for upward trust – convincing leaders that their interests are best served by allowing the strategy expert to operate – is equally skilled and subtle. It has two component parts. The first is to remove fear of failure, which otherwise undermines leaders’ confidence in the strategist. Key to this is to manage the leaders’ feeling of control by, for example keeping them informed and avoiding surprises. The second is to elicit a feeling of confidence. Strategy experts often achieve this by making their strategy process transparent, sometimes illustrating it graphically. This combination of lack of fear and confidence builds trust between a strategy expert and those from whom they take their objectives.

Relating downwards

Relating downwards means building trust with those involved in strategy making and execution who are lower down the organisational hierarchy. These are the people who feed essential information into the strategy process and do the work to make the strategy happen. In our industry especially, they usually have no direct reporting line to the strategy expert. Consequently, a weak downward relationship is often more pernicious because it is invisible.

Strategy experts achieve discretionary trust with their direct and indirect subordinates by managing their commitment to the strategy and therefore, indirectly, to the strategists. Many use ideas deriving from psychologist Victor Vroom’s expectancy theory. This recognises that when asked to support the work of the strategy expert, subordinates do a mental calculation involving three variables (see box 1).

To build downward trust, strategy experts try to manage all three variables. First, they manage expectancy by making clear what the strategy requires and raising the individuals’ self-efficacy (the self-belief that they are capable). Sometimes, this requires training. In other cases, storytelling that equates current challenges to past successes is an effective tool. In any case, strategy experts know that the front line only truly commits to what it thinks it can do. Second, they manage instrumentality by emphasising the individuals’ roles in the strategy. Typically, this involves explaining how the individuals and their departments fit into the wider plan. Often, this means illuminating the hidden links between mundane, behind the scenes work and the more glamourous, visible tasks. As we all know, when we feel significant, we act as if we were significant.

Finally, they manage valance by creating emotional connections to the outcomes of the strategy. In our industry, this is the role of mission statements and patient stories. It is also why strategists play down commercial objectives such as share price and ROI, as they are less motivating to most strategy implementers. Especially in an industry that saves, extends and improves lives, caring about the outcome is a powerful connection to the strategy.

Importantly, these three variables are all necessary but none sufficient. Failure to manage either expectancy, instrumentality or valence can lead to weak downward relationships.

Box 1: Vroom’s Expectancy Theory

When asked to support a strategy, most of us ask ourselves three questions:

  1. The expectancy question: Can I achieve what’s asked of me?
  2. The instrumentality question: Will what I can achieve make a difference to the strategy?
  3. The valence question: Do I care about the outcome of the strategy?

All three factors combine to determine commitment to the strategy.

Relating sideways

Most strategy experts perceive that sideways relationships – with peers at similar levels in the organisation and over whom they have no direct control – are the most problematic. This is a function of two realities of our industry. Firstly, every strategy is cross-functional, involving multiple different departments. Secondly, those departments are necessarily different in their goals and their professional subcultures. A moment’s comparison of the success criteria and mindset of, for example, regulatory affairs and sales, makes this obvious. In these circumstances, trust is always difficult so strategy experts use two, complementary tools to address this issue.

The first is sometimes called the organisational ‘theory of mind’, a term borrowed from developmental psychology. This is the skill of placing oneself inside the head of colleagues from another department. An expert strategist has to understand, for example, the pressure facing salespeople, the limitations constraining regulatory affairs and the ethical drivers shaping medical affairs. Importantly, expert strategists describe how they use that understanding not just to overcome objections but also improve their strategies. Understanding your peers is the first step to building trust with them.

The second tool is called by management scientists the appeal to ‘organisational salience’. In simple terms, this means raising loyalty to the company above loyalty to the department or profession, which is known as group salience. This is not always easy. Human beings default to group salience and this is often encouraged by functional leaders who demand personal loyalty. It is rare to find any life sciences company that does not have some degree of tribalism. Strategy experts overcome this by drawing attention to the organisation mission or by borrowing the authority provided by their upward relationships. Sometimes, they partly bypass department leaders by using their indirect downward relationships.

In any case, both an organisational ‘theory of mind’ and the appeal to ‘organisational salience’ are usually necessary to build discretionary trust sideways between the expert strategist and those peers he needs to make and execute strategy.

The strategy expert’s milking stool

This series began by defining a strategy expert as one whose competence in allocating substantial resources, over the long term, enables the achievement of large goals even in circumstances where a competent practitioner would fail (see article 1). This sets a high bar and differentiates the strategy expert from the majority of strategy practitioners.

Meeting this high standard is not an innate ability. While, like all competencies, strategy expertise may have a genetic component that can only be a predisposition. The acquisition of strategy expertise is like the acquisition of any advanced skill set – it requires intense effort to master a range of capabilities. This series has organised those into the three masteries.

Mastery 1, mastering oneself, is a largely internal process. It involves controlling instinctive ‘fast’ thinking to enable more reflective ‘slow’ thinking, a process that requires the moderation of some extreme personality traits. You know you have achieved self-mastery when you recognise in yourself certain behavioural signs (see the second article).

Mastery 2, mastering knowledge, involves differentiating between insight, knowledge and their antecedents of information and data. Creating insight first requires skills for scanning the environment. It then involves crafting the different flavours of knowledge using inductive, deductive or abductive processes. You know you have mastered knowledge when you can create valuable knowledge when your rivals can’t (see the third article).

And in this fourth and final article, we have seen that mastering relationships is about creating trust under conditions of high discretion. And that must be down upwards, downwards and sideways. In an industry like ours, which requires the concentration of an exceptional variety of capabilities, managing relationships is the third art of the strategy expert.

But the final lesson of this series is that these three masteries rely on each other. Strategy expertise works like a three-legged stool and each of them – mastering oneself, mastering knowledge and mastering relationships – is essential.

If you would like a set of all four PDFs of this series, please contact me at my email address below.


Brian D Smith works at SDA Bocconi and the University of Hertfordshire. He is a world-recognised authority on the evolution of the life sciences industry and welcomes questions at brian.smith@pragmedic.com