Will The New DSO Leadership Model That Bayer Pharmaceuticals Is Transitioning To Work?

I was perusing LinkedIn earlier today, and I saw an interesting post that caught my attention.

It discussed how Bill Anderson, CEO of Bayer Pharmaceuticals, is moving to a different model of Leadership called Dynamic Shared Ownership (DSO).

In this move, Anderson Laid Off 40% of Middle Managers.

I decided to look a bit into the article that was provided to see what this was about.

There was a link to a Medium article by Gianluca Radesich that I read.

Now, the first thing that I noticed is that the author works in the Pharmaceutical Industry.

This means there could be some conflicts of interest within the Article (Though they appear to work for a different company, so maybe not).

However, let's look at what some of the claimed Merits of the DSO Model are here, as well as some Potential Problems to be aware of.

Potential Merits

Slow Hierarchies

There is a known issue in MANY Businesses that the Larger the Hierarchy gets, the Slower everything becomes.

It seems that a part of what Anderson claims is the Goal of their move to DSO is to get rid of this Problem.

Fewer people in the Middle mean that Decisions can be made more quickly

Employee Empowerment

Most Employees don't feel Empowered in their work and instead feel like Cogs-in-the-Machine.

By removing the Middle Managers, Anderson is claiming that this will give the rest of their Employees more Power to make Decisions and Impact.

It is true that when Employees are Empowered, they tend to do better work and have greater Impact.

Employee Innovation

In the claims being made, it also seems like the Goal of Empowering Employees is to create Innovation.

Many businesses are DEEPLY struggling to get Real Innovation.

It is also true that Empowered Employees often can create many of the Greatest Innovations.

This is because they are closer to the day-to-day Challenges and have higher Insights than most Executives could ever dream of.

Agile Teams Through Portfolio Teams

Within this, it seems that Anderson is going to break Employees into "Portfolio Teams".

These Teams will be handling more Processes and will supposedly be gaining greater Insights through the entire Process.

This would then give them a Theoretical Cohesion to see how Problems and Innovations Impact each part of the Process, leading to better and faster Innovations.

Reducing Silos

There is a Goal that is mentioned about Reducing Silos through these Methods.

Supposedly, the DSO Method as it is being Implemented will open Communication and prevent Silos.

Silos are a gigantic Problem for many Teams, and accomplishing this would be Extremely Beneficial.

Intrapreneurship And Shared Ownership

The Model that is being laid out would theoretically make Employees into Intrapreneurs.

Essentially, they would act "as if" they were Entrepreneurs, having more Responsibility and Control, while still "within" a Larger Organization.

This would also lead to Employees feeling like they have Ownership of "their" Products within their Portfolio.

If accomplished, there is a possibility that these Teams would become more Entrepreneurial which can be very Beneficial.

Most Large Organizations are NOT Entrepreneurial and either need to Purchase other Entrepreneurial Companies or they become Replaced by Entrepreneurial Companies.

This could help Anderson's Organization and prevent them from needing to purchase more Entrepreneurial Organizations.

Potential Problems

Buy-In To Structure?

Most people are not quick to Change.

This Model will end up being VASTLY different from what Employees are used to.

It will require breaking down Processes, Recreating Them, and new Habits.

All things that most Humans try to avoid.

With the High Level of Changes involved in accomplishing this DSO Style Team, I have extreme Doubts that most Employees will be Happy about the Changes.

Due to this, I could see them moving as Slowly as Possible, and it could end up being TOO Slow for the Needs of the Organization.

Should More Employees Be Intrapreneurs?

Here's something I think needs to be Realized - Not everyone "should" be an Entrepreneur.

Certain Traits and Skills are required to Succeed as an Entrepreneur, and most people don't have them.

Part of the Reason why most Entrepreneurial Ventures Fail is because their Entrepreneurs don't have the Right Skills and Mindset to Survive when they start the Ventures.

You "can" learn these Skills and Develop these Traits, but they often take Time which most Ventures do not have!

In early Entrepreneurship, things have higher risks, and the wrong move too early can end the Venture before it even begins.

It is VERY possible that turning all of these Portfolio Teams into Intrapreneurial Pursuits will create widespread Failing Teams because the Individuals are not Ready with the Skills and Traits Required.

One Model?

I think that perhaps one of the Biggest Problems we see in most Organizations is that Leaders believe that "One Model" will work.

Part of why Leadership Development Fails 80% of the Time with "Limited Success" the rest is because courses Teach a One Model Approach.

"This" is the "Type of Leadership" you "Need"!

As of 1995, there were over 850 "Academic" Definitions of Leadership.

That was Nearly 30 years ago and doesn't account for Definitions created since, nor "Non-Academic" Definitions.

The Reality is that Most Organizations should have MORE Than One Model of Leadership within their Organization.

Factors should include Who is Currently in the Organization, what Skills are Available, and what are the Goals of the Job Functions, just to name a few.

This becomes MORE true as Organizations become Larger.

There are so many Variables at Play that trying to make EVERYTHING fit into One TINY Model generally doesn't work.

Some Models are better at Accomplishing some things than other Models.

The Model should "fit" with the Team and People who are doing it.

Silos Fixed Or Made Worse?

One of the Claims is that Anderson Hopes to Improve Silos, but I have my Doubts.

The Model as it is being described has "Portfolio Teams" that are supposed to act "Intrapreneurially".

This type of Model does not inherently prevent "Silos", and if anything just makes them FAR MORE likely.

If the Goal for Teams is to make their own Decisions, Act Quickly, and be Agile, it tends to mean that Communication doesn't "Need" to go "Outside" the Team.

If you Force this type of Team to Slow Down to make Communications, you end up Micromanaging it.

If you Micromanage it, you lose Quickness and Agility.

It also means that you end up losing Innovation.

But then if you let them Move and be Quick and Agile, they don't need an "Okay" to move forward.

They tend to Act, and Communication becomes Secondary.

Mix this with the Removal of so many "Middle Managers" and you likely have an Increased Time Period between Team Communications as you make rounds from one Team to the next.

Based on Human Psychophysiology and how Models work, I am Failing to see how Silos will be prevented.

Fixing Structure Or Hiding Truth?

A LARGE Claim of Laying Off the 40% of Middle Managers is so the Organization can pursue a "New Structure".

But is that "True"?

As I try to Read between the Lines, I see a LOT of Buzzwords that are being utilized.

To me, this doesn't Read like a thought-out Business Move.

It Reads a LOT more like PR-Speak, using a Sexy-Sounding Model (DSO) and Business Buzzwords to avoid being labeled as...

Another Company doing Mass Layoffs.

MANY companies are Laying Off large chunks of their workforce, which leads to them getting Labeled as the "Bad Guys".

To me, this sounds like Smoke and Mirrors in an attempt to Avoid that Perception.

Proper Resources?

Speaking of the 40% of Middle Managers that were Laid Off...

Why were they Picked?

Another thing that I have seen VERY Frequently in Business today is that Most Teams, and especially Middle Managers, are not given the Resources to Succeed.

When Success doesn't occur, they get Blamed and Fired or "Laid Off" for Failures of the Executive Team.

Is this another case of that?

Are these Middle Managers just Improperly Resourced Victims of Executive Failure?

What Resources were they given, and were they the Resources they NEEDED?

I often see "Resources" that are given to Teams that Look Good on "Paper", but don't provide REAL Help.

I wouldn't be Surprised if this was the case here as well.

Further, now that a Large Chunk of Middle Management is gone, and Teams are getting MORE Responsibility, will THEY get Better Resources?

The answer is likely No.

If you combine this with the previous point, all we see is that the Middle Management is being Laid Off and Responsibilities are being Forced on other Employees.

Which brings me to my next point.

How Is Pay Impacted?

You are Eliminating a large chunk of Middle Managers and Expecting Lower-Paid Employees to pick up the Work...

Are they going to be Compensated for the Extra Workload?

What about the Extra Risk involved in Intrapreneurship?

The answer here is also likely No.

I would expect that these Employees are being pushed to accept more Work for the same Pay.

This will Lead us to our Final Point.

The Burnout Problem?

Burnout is the Top Problem that Leaders face in Business Today.

80% of Employees are experiencing Burnout.

While in Burnout, your ability to Innovate and Creatively Solve Problems becomes nearly Impossible.

Communication becomes more Problematic as Burnout directly lowers Emotional Intelligence (EQ/EI).

The Ability to Change also becomes Unattainable because the Body does not have enough Energy (Mg-ATP) to accomplish it.

We also know that Healthcare is an Industry with some of the WORSE rates of Burnout, which includes Pharmaceuticals.

So, does the DSO Model do ANYTHING to fix the Burnout Problem?

Absolutely not.

If anything, this Model is going to make Burnout WAY WORSE!

Then, if you combine it with Under-Resourcing, Higher Expectations, and More Workload at the Same Pay, it's a Recipe for Disaster.

Looking at the Reality of all of this, the most likely scenario is that Burnout will become more Rampant than it already is.

Final Verdict

I am not convinced.

Though there are "Theoretical" Merits to the DSO Model, I don't think it is going to work within this Context.

Of course, I haven't seen "everything" involved in Anderson's Plans, so I could be missing essential pieces of the puzzle.

However, given

• The Realities of Today's Workplace
• The Behaviors Most Likely Exhibited by Humans under these Pressures
• The Logical Gaps that I'm seeing
• The Burnout Prevalence
• Mixed with the high levels of Buzzwords...

None of that leaves me Hopeful that the move to the DSO Model will work for the Purposes Presented.

Now, I'm not saying that DSO itself cannot work in the right Teams or Organizations - in fact, I can see it being a Fantastic Model in MANY Scenarios!

Within "this" Context though, I do not believe it will Accomplish the Goals.

If you want more Innovation, Creative Problem Solving, and Communication, you must have Flow States.

Flow States are Inaccessible when Employees are in Burnout.

Making Burnout Worse will likely make EVERYTHING else Significantly Worse.

Given the Industry and current rates of Burnout, this MAJOR Change will only cause more Chaos.

Given the Economic Climate and Trends among Businesses, I'm also not convinced this Change is Genuinely in the Best Interest of the Organization.

It looks and sounds much more like PR-Speak for a Major Layoff than it sounds like a Legitimate Business Move.

If so, Anderson will find that Productivity will diminish and that there will be more Problems Gained.

At the end of the Day, I'm HIGHLY skeptical of this move, and I think the Pharmaceutical Industry has significantly Larger Problems than their Organizational Structure.

But I would love to be proven wrong.

Leaders and Employees are Struggling at High Levels.

We DO need to see MAJOR Changes in the Workplace.

If DSO can "Truly" accomplish the Goals and Merits described, then Great!

However, there are better ways to Accomplish the Goals that Leaders Need, in a way that ALSO Benefits Employees.

It all comes down to Designing a Regenerative Legacy.