Organisational Mutation (Episode 95)

Organisational Mutation (Episode 95)

Interview with Sandie Philipsen, Senior Director R&ED Transformation Office and Interim head of R&ED Executive Office at Novo Nordisk.

All organisations need to change to adapt to a changing environment. In that sense, an organisation is like a living organism – they need to evolve.

In nature, this change is, in part, created by mutations. So, could mutations be a good idea for companies? Let’s study the idea of “Organisational Mutations”.

I learned about Organisational Mutations from Sandie Philipsen, Senior Director R&ED Transformation Office and Interim head of R&ED Executive Office at Novo Nordisk. Novo Nordisk is the highest valued company in Europe, so it could be worth studying.

Sandie, who has found evolution interesting since she was a little child, has been with Novo Nordisk for over ten years. She was driving the creation of the Transformation Research Units or TRU’s, as they are called, when they were introduced in the Research and Early Development in Novo Nordisk, the concept of the TRU’s was developed in collaboration with an external consultancy.

A Transformational Research Unit can be described as an “internal spin-off”. A group given more autonomy and independence than a regular department, but which is still part of the organisation, and not spun off as a normal spin-off.

Novo Nordisk has different kinds of TRU’s, one of them work on Stem cells, another one is on the Oxford Research site.

The TRU’s are encouraged to develop their own culture, mission etc. They are also instructed to explore new ways of working, and to use new processes and/or technologies to reach their – often extremely ambitious – goals.

This freedom is there for two reasons:

1) To encourage innovation by not having to be “stuck” in the larger Novo Nordisk bureaucracy.

2) To discover ideas that could be brought back to the main Novo Nordisk organisation.

A mutation is: “an alteration in the genetic material (the genome) of a cell of a living organism or of a virus that is more or less permanent and that can be transmitted to the cell’s or the virus’s descendants.”

An Organisational Mutation is: “an alteration in how to work in one department that is more or less permanent and that can be transmitted to the rest of the cooperation.”

Sandie explained to me: “We created the TRU’s to shield these groups from the main organisation of Novo Nordisk. Novo Nordisk is set up to be an extremely successful organisation for delivering what we do, but we also need groups to discover what we should – or could – be doing.”

By testing new ways of working in a small group the effect of it can be evaluated without risking the larger organisation.

The TRU’s are allowed to be outside the normal governance to experiment with how to work. If the experiment is deemed successful, it’s brought back. A couple of TRU’s have already been brought back into the Novo Nordisk way of working.

At this point it might be worth pointing out that mutations are not something bad.

If the mutation does not work it will be phased out, both in nature and when practicing Organisational Mutation. But if the mutation is an improvement, it’s brought in to change the whole organisation.

Sandie stressed that an Organisational Mutation could be TOO much of an alteration from the “host organisation”: “an organ will reject something that is too alien to it – and so will an organisation. So make sure that the Organisational Mutations you try out with do not go crazy.”

But also do not forget that the TRU’s are there to try new things. Sandie again: “We need radically better products and radically new ways of working. The TRU’s are a way to try things out.”

According to Sandie, the TRU’s have been “super successful”. (The “Oxford Research Site, for example, was more established but was struggling to find its feet in the global organization. The TRU concept helped fuel an energy and focus as it was transformed into a TRU. Now, a few years later, they are over 100 people and have become a completely vital part of the early discovery efforts of Novo Nordisk.

Finally some lessons from Sandie for setting up a Transformation Research Unit, or any other kind of Organisational Mutation Department:

1) “You need to be daring.”

Setting up a different kind of organisation within an existing organisation with different governance, goals, even values, comes with a lot of friction. Be prepared to meet pushback.

2) “As a leader you have to push it.”

For an Organisational Mutation to get accepted by the main organisation it needs support from the top leadership.

3) “There has to be a constant focus on doing things differently”.

The role of a mutation is to change things. To create alterations. So, always remind the team tasked with running the organisational mutation to do just that.

4) “Be deliberate about what works and what doesn’t.”

When evaluating the Mutated Organisation the most important aspect, of course, is that it is working. Are they efficient, innovative, and is it a healthy organisation etc? Then, make sure you understand WHY this mutation is working, what aspects of it can be transferred, scaled and implemented elsewhere.

5) “Be cognisant about what you bring back to the main organisation.”

It’s not enough that sometihng works in that little mutated group. Ask yourself, will this also work in the main organisation?

Think about it like a vaccine. A vaccine is a mutated but weaker, version of a virus that does create a reaction in the “host” but doesn’t run havoc with it.

An Organisational Mutation should be like a “vaccine of change” – a small, tested change that gets implemented to prepare the main organisation for a dangerous future change.

Does your organisation have an Organisational Mutation?

If so, how does it work? If not, why not?

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