Some of our team recently made their way to CPHI in Frankfurt this year. Needless to say, they learned all sorts of incredible insights that we’re about to share with you. Don’t forget to check out our experts’ LinkedIn pages to stay updated on their latest insights!
In this article, everyone who attended CPHI reveals their most important industry secret:
- Harry Simpson – Cost Inflation
- Rosey Grant – Job Titles
- Neil Ewington – Greenwashing
- Brett Lofthouse – Talent
- Matt Lambert – Company Agility
“Cost Inflation Is Driving Outsourcing.”
Costs are increasing — everywhere. At CPHI, Harry discovered these higher costs mean it’s becoming more expensive for Life Science businesses to manufacture products themselves. Ultimately, they’re turning to CMOs to fulfil that need for production at a much lower cost.
So how can CMOs fulfil this?
Due to their size, CMOs have access to economies of scale. In other words, the more they produce, the less it costs per unit. This cost saving is passed to the organisation that needs their product made.
There are currently two main options the Life Science businesses are choosing between.
Outsourcing to Asia
Some companies are choosing to outsource to CMOs based in Asian territories. The main pros and cons of this are:
- Lower Costs
- Compromise on Quality
- Potential for a breakdown in the supply chain
The second option is to choose outsourcing partners closer to the development sites. This provides better service, but the costs are higher.
- Higher Costs
- Improved Quality
- Stronger Supply Chain
Unsurprisingly, CPHI attendees revealed outsourcing locally is more popular. While the costs are higher, this is worth the reassurance of a more secure supply chain and better quality products.
“Job Titles Are Inflating Too.”
Our experts have already noticed that job titles are inflated, but CPHI highlighted how widespread it is becoming.
Essentially, as talent becomes more scarce, some companies give their employees more impressive job titles instead of raising salaries. This gives the employee an illusion of progression, without increasing costs for the business.
While this practice provides short-term talent retention, it makes hiring practices more difficult across the wider industry. The biggest issue it creates is diluting the talent pool, flooding the job market with unqualified people who believe they’re capable of the role.
This is a major issue and causes many others (for employer and employee) down the line. For instance, if someone with an inflated job title lands a new job, they’ll likely struggle in their new role.
For the company, the substandard quality of work can impact operations, causing decreased employee morale, lower customer satisfaction, and damaged profits.
The employee may lose self-confidence, as they realise they cannot meet the workload. This can further disrupt morale and work ethic, consequently stagnating the employee’s career.
“Greenwashing No Longer Cuts It.”
Greenwashing is when a company outwardly supports eco-friendly practices, but doesn’t actually do anything about it. Due to social media, it is now incredibly easy for offending companies to be caught out, which can significantly damage their reputation. At an event like CPHI, this becomes exceedingly clear.
Sustainability Directors are now at the Board level, which means they have the power to directly influence change in the business. There’s also a range of options that benefit both the company and the environment – they aren’t mutually exclusive.
One significant motivation for development is the increasing energy costs, which stunt business growth. In return, businesses are looking into more eco-friendly options where prices are significantly lower.
Because of the worldwide focus on environmentally friendly practices, Pharma and Bio companies are even considering this when choosing their outsourcing partners.
“When It Comes To Talent, There Are Still Two Camps.”
One shocking revelation is that some C-Level Execs think that recruiting is below their pay grade. Currently, the split is about 50/50 between those who recognise the growing problem, and those who don’t.
Business leaders who recognise the problem and implement talent acquisition strategies now will hire better over the coming years.
In our opinion, hybrid recruitment models (using internal and external recruitment simultaneously) will help overcome the worst of the talent crunch. Internal recruitment teams are perfect for lower complexity, high volume positions.
On the other hand, talent consultancies (like Fraser Dove) specialise in high complexity, low volume roles. These are the essential roles that your team will need significant investment and experience to fill.
“Small Companies Are Punching Above Their Weight.”
One development Brett discovered at CPHI is that smaller companies are hiring top-tier talent more successfully. Typically, top talent would be found at the businesses that could pay the most, but that attitude is quickly changing.
Instead, smaller companies are using their agility to create individually tailored work solutions, which provide each employee with their ideal work-life blend. This is more attractive to people, especially since the Covid Pandemic proved that employees don’t need to be in a lab or office every day.
It’s not just work-life balance, though. Smaller companies are constantly innovating new methods to attract and retain their talent. Larger companies are too big and slow to implement these processes at the same pace.
While these solutions work for smaller firms now, they may find that as they grow, there’s a loss in company agility. The challenge then becomes continuing to offer these individually tailored solutions as they considerably increase their headcount.
At Fraser Dove, we’re constantly monitoring the market for the latest Life Science hiring trends. Alongside our Talent Ecosystem, this means we can give our clients the best service possible. The most significant trend we’ve spotted is the Talent Crunch, which is expected to peak in 2030.