Blog #5: The Opportunity to Create Shared Value is Everywhere

Blog 5: The Opportunity to Create Shared Value is Everywhere

My focus of study while at Carnegie Mellon is Health Care Policy and Management. Hence, it is natural that this week’s readings Creating Shared Value by Mark Kramer and Twelve Forces That Will Radically Change How Organizations Work by Vikram Bhalla, et al. made me think about the importance of shared value when it pertains to healthcare and life sciences.

There is an interconnectedness in the development of scientific research between private industry and government. My personal background is in the life sciences and clinical research, where this collaboration seems most apparent. In academic research, grant funding for researchers is key. A few of the areas that brought to mind a life sciences and healthcare application come from Kramer’s work¹:

1.       Reconceiving Products and Markets: In the case of pharmaceuticals, this aspect is key. For instance, once patents expire, companies must reassess their market share. When developing new pharmaceuticals to address a disease, market research must be conducted and product safety and viability studied. The flow in pharmaceutical development is

2.       Redefining Productivity in the Value Chain: Regarding the pharmaceutical industry, research and  development comprise a large portion of the costs before any revenue is made. On today’s blog, I would like to address three factors to consider in order to lower costs and create shared value in the life sciences industry:

a.       Resource Use: In the life sciences industry, the high costs and limited resources for R&D become a difficulty in developing life-saving technologies and medications.

b.      Procurement: By rethinking resource channels and involving providers that may not have had participation prior, one can create shared value. For instance, a pharmaceutical company involving local environmental groups and advisors to create procurement channels can create value for locals as well as for itself.

c.       Distribution: In a similar fashion to procurement, a life sciences company that invites the community and even national agencies openly for collaboration may come up with cost and environmentally efficient distribution channels.

3.       Enabling Local Cluster Development: No two countries are the same. Even under democratic governments that may be open to innovation and scientific development, rules and regulations abound. As a life sciences/pharmaceutical company, it is valuable to involve the local community and encourage cluster development. By empowering locals and sharing technical knowledge, the whole community benefits. This may impact workforce availability, as well as reduce the need for outsourcing.

¹ Kramer, M. E. (2015, August 25). Creating Shared Value. Retrieved from https://hbr.org/2011/01/the-big-idea-creating-shared-value