In the pharmaceutical industry there are many different types of outsourcing. There is functional outsourcing (research, development, commercial, regulatory, IT, etc.), outsourcing of roles, (project management, CRAs, chemists, etc.), and outsourcing of projects (drugs, vaccines, clinical trials, initiatives, software, etc.).
To gauge the amount of outsourcing going on these days, consider outsourcing of clinical trials. In 2008, the Tufts Center for the Study of Drug Development estimated the total market size for contract clinical services at approximately $8.5 billion. Nearly 10 years later, market sizing estimates put the contract clinical service industry at over $30 billion1. Moving forward, Reports and Data estimates the global Contract Research Outsourcing market to reach USD $68.14 Billion by the year 2026, at a growth rate of 7.4 %2.
With outsourcing being so prevalent, this has created a big challenge in finding qualified professionals. For example, consulting services are expected to be the second-fastest-growing CRO market segment during the forecast period 2019-2026 with a growth rate of 7.4 %. However, the lack of skilled professionals is a major challenge for the growth of this market segment.
To put this into perspective, consider the graph below that depicts the number of clinical trials registered3. How will service providers support the continued levels of outsourcing for clinical trials or any other areas of outsourcing in pharmaceutical companies?
The talent pool shrinks even more for senior-level, outsourced roles, such as project managers. This could be project managers to help manage pipeline, such as clinical project managers, drug development program managers, CMC project managers, regulatory project managers, etc. Or it could be project managers to manage operational initiatives, such as integration work for mergers, project managers for implementing software, project managers for corporate initiatives that span multiple functions, etc. As indicated by the graph above, it will become a real challenge to find qualified people. Over the last few years more and more pharmaceutical companies have been turning to outsourcing to fill these roles, and that is only the beginning.
Given these trends, what should a pharmaceutical company or biotech consider when looking for project management consultants, or a partnership with a consulting company that can provide expert project managers? Below are four main attributes to consider.
- Client Attributes (pharmaceutical companies and biotechs)
- Partner Attributes (consulting companies, CROs, contracting companies)
- Project Management role attributes (what is needed for the role)
- Consultant Attributes (the people pharma companies will interview)
Outsourcing project management is not a short-term solution. It takes time for project managers to start a new project or come up to speed on an existing project. The project manager needs to learn how the company works, how they manage projects, and what the culture is like and the impacts it may have on the project.
The best contract project managers bring their experiences to a client but adapt to the way the client works. This creates a much better result. If the project manager is working in a GxP environment it will take even longer for the project manager to come up to speed.
Consider a drug development program manager as an example. The first several weeks are often spent reading SOPs. The next step is to learn the science behind the small molecule, vaccine, etc. In addition, the compound they are managing will already have at least a five-year history. It takes time to learn what decisions were made and why. While all this is happening, the development program manager is learning to adapt to the way the client works. Typically, it takes three to six months for a development program manager to truly be productive. So why would anyone think outsourcing project management is a short-term solution?
Given all these considerations, how should a client evaluate potential partners to outsource project management? One key item a client should evaluate is whether the partner feels like a company with a culture where consultants would work for several years. If consultants come and go every few months, they will never be able to get up to speed and contribute value before they moved on to the next gig. This should fit the concept that outsourcing project management is not a short-term solution.
The partner should have a project management focus and a defined culture that attracts top talent for project management. The partner should demonstrate all this by being able to produce project managers quickly to react to the demands of new projects. And of course, they should be able to produce references that can attest to the long-term sticking power of their project managers.
Project Management Attributes
The points above might suggest the next topic should be how to evaluate a project management consultant, but this would be skipping a critical role, defining the project management role. Clients often don’t think enough about how the role should be framed. Or, if they do think about framing the role, they write a job description and think the role is defined. This is a great start, but there are more considerations that need to be answered first before a job description is created.
For example, and one we see happen often is, when a client has employees who are senior, acting as project managers and who are fully dedicated to a project. In this case, it probably does not make sense to define the project management role as someone who is senior. Junior project managers or project coordinators are a better fit for the team. Why? They will not be bored, will be more engaged and more interested in learning. The partner should help the client think through the right fit and provide honest feedback, even if the feedback goes against what the client is thinking.
Another consideration is, who will the project management consultant be interacting with? Executives? Cross-functional teams? Will they be more in a supportive role at meetings taking minutes, or driving and facilitating meetings? All these considerations lead to very different job descriptions. We often help clients work through this discussion and couple it with another important dimension, subject matter expertise. Examples of this include Microsoft Project proficiency, late-stage experience, experience with MAA filings, therapeutic area experience, etc..
Think of a two by two matrix of project management experience and subject matter expertise. Where does your project management needs for the specific project fit? The right fit will lead to a better experience for both the client and the consultant and will lead to greater success.
In addition, this is a tool that should be utilized for budgeting purposes to make sure you don’t under- or overprice the rate for the project manager. A project manager with high project management experience and a high subject matter expertise will lead to a higher rate and will be more difficult to find.
For example, does a drug development program manager really need expertise in a particular therapeutic area? For some areas it makes sense, such as oncology or rare diseases, but it’s much more important to find the right personality with the right level of project management expertise. As you walk through this exercise, the job description and budget should then reflect how the role is framed and defined.
In other instances, a company may need a junior project manager or simply a project coordinator. Why overpay for a senior project manager who will be bored and less engaged (and more likely to leave) than a junior project manager who will be eager to get his or her hands dirty? It makes no sense and hinders the success of the project and will probably frustrate the team as well.
Why is all this important? The effort to interview project management consultants is overwhelming and something you want to do only once for a project. The effort to review resumes, coordinate interviews, host interviews, consensus calls, etc. is not something to be taken lightly. If a project manager does not work out for whatever reason, it is demoralizing to a team and the thought of interviewing consultants again is not a task met with enthusiasm. Selecting the right consultant the first time is key to success for outsourcing project management roles. To get a more detailed consideration on what to consider in a project management consultant, stay tuned for our upcoming blog “What Makes a Good PM Consultant”.
Success starts with the sponsor company recognizing all the above, or least in the sponsor company selecting a project management partner who can provide this kind of guidance. When you outsource project management roles, you want the project management consultant to look and feel like an employee. Someone who is invested in the success of the project and the client – someone who will be around to help the client succeed for years, not months.
If you are considering outsourcing project management get it right the first time. Define the role correctly. Partner with the right partner. Have a robust interview process tied to the role definition. Avoid re-interviewing, which leads to increased frustration, second guessing the decision to outsource project management and a lot of wasted, duplicate efforts during the interview process. Your return on investment will be twice as high on the project manager when considering all these factors.