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Darwin's Medicine blog

Professor Brian D Smith is an authority on the pharmaceutical industry and works at SDA Bocconi University and Hertfordshire Business School.

Quick Change

What bird feathers can teach us about adapting to the market

Peacock

One of the great benefits of robust scientific theory is that it allows you to transfer lessons from one area to another. Our relatively recent understanding of the theory behind the adaptive immune system has allowed the development of therapies in several disease areas, for example. Our explanation of how genes express themselves is revolutionising many fields of medicine. And the same idea-transfer benefits arise from using evolutionary theory to understand how business models evolve. As usual, allow me a short digression into the science on my way to some practical conclusions.

Recently, I was advising a company on how it might improve its strategy process and in particular its approach to market segmentation. Its current practice is pretty typical of the industry: it segments the market according to disease stage. I was encouraging it to adopt contextual segmentation. In this approach (see PME April 2012) the heterogeneity of patients, payers and professionals is combined to understand the market in terms of the different contexts in which the usage decision is made.

This is an approach I’ve taught many companies. It’s an adaptation to markets in which prescribing decisions reflect not only clinical needs but also non- clinical needs of all three stakeholders. My client company was struggling with it. The concept was understandable enough, it said, but the problem lay in its business information systems and processes, which were designed
to support traditional segmentation and did not allow contextual segmentation. As its Chief Marketing Officer put it: “You’re asking us to make a leap, and that doesn’t happen in evolution.” He had a point, of course; evolution is almost synonymous with gradualism. But, as often happens, his comment triggered a connection in my brain to evolutionary science. This issue – how does evolution apparently make sometimes quick, large changes – was something that Darwin himself addressed, but which was later explained by others, such as the Frenchman Lucien Cuènot.

What Cuènot and others realised is that when a significant evolutionary leap appears, it is often not as much of a leap as it first seems. Often, the trait in question is not a ‘de novo’ trait, springing out of nowhere; rather it is the minor adaptation of some prior
trait developed for some other purpose.

For example, feathers may seem to be a big leap needed for flight but, in fact, they appeared before flight as an adaptation to retain warmth and needed only a little adaptation to make them airworthy. Similarly, evolutionary psychologists think that humans’ calculation and grammar skills are merely small changes in cognitive abilities that evolved earlier for other purposes.
If you studied biology, you might have heard this process referred to as pre-adaptation, exaptation or co-option. Whatever the label, it’s a way of explaining how large changes appear to happen quickly.

So how does this help my client or indeed any life sciences company trying to evolve in a non-gradual way? Well, it guides us to look for existing adaptations that can be co-opted for the desired purpose, like heat-retaining feathers co-opted for flying. In the case of my client company, much of what corporate marketing needed to do was already being done in the sales team. When given a new product, the field teams were focusing on local payer attitude, prescriber behaviour and patient adherence, as well as clinical status. Much of the information needed to implement contextual segmentation was already there.

All that was needed was to co-opt the sales team processes via an incremental change in where information was stored and how it was managed. What had seemed to the CMO like an impossible evolutionary leap turned out to be a manageable step in their development.

To return to the analogy, all that was needed was minor adaptation to the feathers they already had.

There are many other examples of this sort of co-option in my work. Extended, beyond- the-pill, value propositions that seem difficult are sometimes just syntheses of several things that are already being done in sales support, education and professional relations. Advanced competencies in scanning the environment can evolve by structuring informal, gossip-like conversations that happen among colleagues. Once one starts to look for it, the opportunity to usefully co-opt existing activity can be found all over the company. The biggest barrier to it seems to be the delusion that any significant, valuable change has to be the result of somemajor project, usually involving large investments and the payment of fees to a consultant.

The practical implication? If you think you need to change something about your business model, pause before you call the consultant. Consider first if any part of this change is already happening elsewhere in your organisation, even if for a completely different purpose. If it is, consider how you might co-opt that adaptation to your own ends. Evolution doesn’t have big-ticket change programmes and you might not always need them either.

Article by
Professor Brian D Smith

Professor Brian D Smith is a world-recognised authority on the evolution of the life sciences industry. He welcomes comments and questions at brian.smith@pragmedic.com

21st March 2019

From: Marketing

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