Reference no: EM132167935
CASE STUDY : PFIZER PHARMACEUTICALS
Researchers at the Gallup-Healthways Well-Being Index estimate that employee unhappiness costs US businesses a mind-boggling $300 billion per year in lost productivity. And although worker productivity—what drives it, what quashes it—is a topic of some debate, certain correlations show up again and again: unhappy workers have high levels of absenteeism and produce less in both quality and quantity.According to a 2011 Harvard Business Reviewarticle,workers’ creativity, productivity, commitment, and collegiality are all affected by their level of happiness, and the corporate bottom line either suffers or flourishes as a result.
Discussions about the world’s “happiest places to work” might bring to mind some now-famous companies like Zappos, with its focus on hiring only the right employees, or any number of technology-based start-ups creating unusual workspaces to foster creativity. The seemingly cold and faceless world of pharmaceuticals is perhaps an unlikely candidate for a happy place to work. Yet for the second year in a row, 165-year-old New York City-based Pfizer Pharmaceuticals grabbed the number one spot on the 50 Happiest Companies in America list published on career website CareerBliss. With annual revenue exceeding $67 billion, driven by more than 110,000employees, Pfizer—the maker of Advil, ChapStick, Zoloft, Viagra, Dimetapp, and hundreds of other drugstore products found both behind and over the counter—not only ranks as the world’s largest pharmaceutical company, it also employs the happiest workers.
Job satisfaction at Pfizer is the result of forward-thinking, innovative policies that seek to create a meaningful, engaging environment for colleagues (as Pfizer employees are called)—and one in which those colleagues enjoy working with each other. The most prominent strategy used in creating such an environment is ownership. Pfizer CEO Ian Read promoted the ownership culture in 2012 with the goal of engaging each employee in improving the company for all its stakeholders, from consumers to shareholders. The ultimate goal was the creation of a work environment that was a birthplace not only of new products, but of new pathways leading to those products. In turn, this environment would support the employees within it and foster in them a deep sense of responsibility to fellow colleagues and every company stakeholder.
The idea of the ownership model was born of candid research within the company among employees at every level. That led to the creation of a corporate culture that fosters independent and innovative thinking, provides opportunity for growth and movement within the company, gives meaningful feedback to employees, and encourages responsible risk taking while placing a high emphasis on personal responsibility. Failure is treated as an inevitability that provides an opportunity for learning or problem solving—and pharmaceutical research is no stranger to failure. By accepting failure and providing meaningful, constructive feedback, the company encourages employees to innovate, and innovation is something Pfizer considers an imperative for continued success in a crowded industry.
The ownership model isn’t the only aspect of Pfizer employment that leads to contented workers; the company has also taken great strides to ensure that its colleagues spend most of their time at work able to focus on what they were hired to do. Although at first glance this seems an obvious step, Pfizer’s own reviews of employee activity found that a significant chunk of valuable time was spent on “support tasks,” like creating Microsoft PowerPoint presentations or handling correspondence, instead of on the appropriate use of the employee’s talents and primary job roles. To address this issue, Pfizer turned to outsourcing, which is the practice of transferring work to other companies to save on costs. Pfizer employees can outsource presentations, data mining and analysis, document creation, scheduling, and other tasks so they can spend more time developing and implementing new research strategies, conducting research, and all the other tasks that allow Pfizer to remain a leading innovator in the industry. The result of this strategy is a tangible increase in productivity over shorter periods of time. This means a shorter path from idea to research to execution, not only for new products but for new business strategies as well.
Pfizer has worked hard to be an innovator, not only in the pharmaceutical development that sustains the bottom line but also in the creation of a corporate environment filled with happy, productive employees. The company’s own stated outlook is that even in an industry driven by patents and products, “Pfizer’s most important assets leave our building at the end of each workday.” This company is a primary example of the value gained by having employees who believe in what they do and feel encouraged to produce high-quality, innovative work, not because they fear the consequences of underperforming but because they feel like a part of the company in a meaningful way. Pfizer’s corporate policy treats employees as people rather than numbers, and the success of this strategy is evident in its continued reign as the largest pharmaceutical company in the world—and now the happiest, too.
Case Questions
1. Describe how Pfizer enriches its human capital in value, rareness, and inimitability.
2. Show how Pfizer is utilizing three levels of analysis to its practice of strategic organizational behavior.
3. In what ways does Pfizer utilize positive organizational behavior?