Report onGroup and Organizational Dynamics at Baxter India Pvt. Ltd

By:

B014 SWATI DEB B016 MOHIT GAUR

B020 ANANTAYA GUPTA B037 KUMAR MAYANK

B044 RASHMEET K. NANDA B047 DHRUITI PRAYAG

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Table of ContentsAcknowledgements...............................................................................................................................................................2

Abstract.................................................................................................................................................................................2

Introduction...........................................................................................................................................................................3

Backdrop of the study...........................................................................................................................................................3

Objectives of the study..........................................................................................................................................................3

Scope of the Study................................................................................................................................................................3

Limitations of the study.........................................................................................................................................................3

Research Methodology..........................................................................................................................................................3

Industry Profile.....................................................................................................................................................................4

Company Profile...................................................................................................................................................................4

Analysis of group and organizational dynamics of the company..........................................................................................4

Organizational Structure and Design.................................................................................................................................4

Team and Group Dynamics...............................................................................................................................................5

Decision Making...............................................................................................................................................................6

Change Management.........................................................................................................................................................6

Power Politics and conflict resolution...............................................................................................................................7

Organizational Culture......................................................................................................................................................8

Conclusion..........................................................................................................................................................................10

References...........................................................................................................................................................................10

Appendix.............................................................................................................................................................................10

Acknowledgements

We are grateful to Dr. Shivangi Gupta, Product Manager at Baxter Healthcare Pvt. Ltd., for her encouraging support towards this project; Ms. Shveta Bakshi (Ex-Baxter employee, now Product Manager, Biopharma India) and Ms. Shweta Sukhija (Ex-Baxter employee, now Manager Regulatory Affairs, APAC Region) for giving us insights into the organizational dynamics at Baxter and addressing our queries.We are thankful to Prof. Gowri Joshi for introducing the course topics that helped us in the analysis of this study and in our group discussions; and for providing relevant study material for our reference.

Abstract

This report consists of our study of the concepts of group organizational dynamics at Baxter India Ltd. The study was conducted by collecting primary and secondary data from various sources and understanding how the

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organization manages its human resources using concepts of group and organization dynamics. During the course of study we found that the organization follows a rather flat structure which fosters open communication thereby encouraging functional conflicts and open dialogue. We also observed that due to this open culture and mutual trust among the employees and the management, there have been no incidences of political behavior. During the course of our study we could clearly see the applicability of the group and organizational principles in a real life scenario thereby helping our understanding of the same.

Introduction

For the pharmaceutical industry tomorrow’s challenge is to develop new medicines that can prevent or cure currently incurable diseases. However, constraints like frequent penalties, unsustainably high costs per approved molecule, flat lined scientific productivity over a decade have imposed economic and operational bottlenecks for the industry. Despite numerous challenges Baxter continues to go from strength to strength with its global presence and infrastructure. Baxter's philosophy of manufacturing locally allows it to better manage production, costs and prices. Baxter products are sold in over 100 countries.

Backdrop of the study

This study has been undertaken towards the completion of report on Analysis of group and organizational dynamics in the pharmaceutical sector. We chose Baxter India Pvt. Ltd, a subsidiary of Baxter Int., a pharmaceutical company based in Deerfield,Illinois for our study. Based on interactions with company officials, primary research with current and former employees of Baxter India Pvt. Ltd and secondary research, we have analyzed the organizational dynamics of the company and the sector in general, and articulated them in the form of this report.

Objectives of the study

To understand the organizational structure of the company under study To understand the influence of power and conflict equations in the company To understand the change management within the company To understand the organizational values and culture and their effect on employee experience

Scope of the Study

To carry out primary and secondary research towards the objectives of the study To study the profile of pharmaceutical industry and the company (Baxter India Pvt. Ltd.) To study the research findings and make a detailed analysis of the organizational dynamics of the

company To suggest recommendations towards improving the organizational dynamics of the company To prepare a report articulating the above

Limitations of the study

This report is based on the information shared by Baxter India Pvt. Ltd and our analysis of the same, due to confidentiality issues we were given limited access to information as per company policy.

Research Methodology

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The study deals with understanding the organizational and group dynamics of the pharmaceutical company. The same was conducted and analyzed using a questionnaire survey through email. Personal responses from the company employees were taken through telephonic conversations. Secondary research was carried out through research papers, internet and databases. The responses obtained from the company were related to the concepts of group and organizational dynamics using the textbook, Organizational Behavior by Stephen P. Robbins, Timothy A. Judge and Neharika Vohra and also the study material shared by Prof. Gowri Joshi. Industry Profile

The healthcare and pharmaceutical industry is one of the fastest growing industry in the world. With increasing population and discovery of newer diseases, challenges for the healthcare and pharmaceutical industry are growing day by day. The global pharmaceuticals industry is worth US$300 billion, a figure expected to rise to US$400 billion within three years.

The Indian Pharmaceutical Industry (IPI) is globally the 3rd and 13th largest in terms of volume and value respectively. The size of the IPI is estimated at $32 billion in 2012-13. Of this, the domestic formulations market was valued at about $11.4 billion (or Rs 623.3 billion) and constituted 2% of the global pharmaceutical market in value terms. The domestic pharma market has reported a growth of 6.8%, as per IMS Health. The growth factors are increasing sales of generic medicines, continued growth in chronic therapies and a greater penetration in rural markets. The industry is expected to have a growth of 10-12 %in 2013-14, according to a study by ICRA.

Company Profile

Baxter is an American company with its headquarters at Deerfield, Illinois. It has been pioneer in healthcare for more than 80 years. Baxter manufactures and markets products that save and sustain the lives of people by focusing on improving the access and quality of healthcare to as many people as possible. It has two fields of products where it does business namely Bioscience and Healthcare. It has developed expertise in Anesthesia, Bio Surgery, Critical care, Hemophilia, Immunoglobulin, Pulmonology, Renal Disorders and Vaccines. With its wide range of products and services it achieved a revenue of $14.2 billion in the year 2011-12.

Baxter believes in developing a strong relationship with not only its customers but also its employees. It also believes that the talented group of employees that it has is the greatest resource of the company and thus believes in developing a sustainable relationship with its employees too. It has always followed its core set of values namely innovation, excellence, trust, sustainability and diversity.

Analysis of group and organizational dynamics of the company

Organizational Structure and Design

Baxter India has three business units namely, BioPharma, Medication Delivery and Renal. The organization structure is more inclined towards being flat, there are a few layers but the hierarchy is in place more to provide an arrangement to manage rather than enforce some kind of red tapism. The flat structure represents a very open environment in the company. Having a hierarchical structure creates a barrier in interaction between different levels of employees and prevents team cohesion and coordination. Baxter has solved this problem by developing a perfect balance between flat and hierarchical structure. Below is the organizational hierarchical chart of Baxter India:-

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Baxter India is headed by the General Manager Mr. Anish Bafna. Under him, there are three business units as mentioned above. Each Business Unit has its director under whom, the marketing manager and national sales manager work. There are seven directors for various functions as shown in the figure. Hence, Baxter India has a simple organizational structure.

Team and Group Dynamics

Group Properties

Roles: The roles of the team members are well structured and every team member is assigned key responsibility areas (KRAs) which are set biannually. The KRAs are known as Performance Management Objectives (PMO) in Baxter. The goals and targets of the organization are discussed in half yearly meetings by the GM with the Business Unit Directors (BUDs).The BUDs are responsible for assigning the PMOs to the reporting managers. The six vertical departments in which employees are assigned on projects are Customer Servicing, People and team Management, Innovation, Compliance Maintenance, Quality Control and Finance.

Management in Baxter takes conscious efforts to explicitly state the role expectations and clear the role perceptions. Before finalizing the PMOs for any employee a one to one meeting takes place and goals are discussed in depth before getting finalized.

Size: Team size is 6-7.The team size is optimum to increase the group cohesiveness among members and facilitate problem solving abilities. It also helps keep a check on social loafing.

Norms: Baxter follows performance norms to assess the level of productive output delivered by different departments. Allocation of resources norms is also religiously taken into consideration by effective distribution and assignment of right jobs and materials

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Decision Making

Team levelThe company follows brainstorming method to solve issues within the team meetings. All team members are encouraged to think out of the box and come up with innovative ideas. Healthy discussions are encouraged amongst team members and final decisions are discussed in depth before submitting it to the department level.

Department levelInteracting groups consisting of managers with the expertise in the required field and key members of the department take the decision. For instance when a new process has to be adopted by a department all aspects of the new idea is dealt with in-depth by the management before implementing such changes

Company level Nominal group technique, electronic meetings and interacting groups of BUDs of the different business units and the GM is the most prevalent group decision making process.

Change Management

Change is a common thread that runs through all businesses regardless of size, industry and age. In today’s competitive world it is imperative for any organization to manage change well. Organizations that handle change well thrive, whilst those that do not may struggle to survive. An example of Change was when Baxter moved into a more open format office (No Cubicles, No Cabins) from a closed office with separate cabins & cubicles. This meant that employee would have to compromise with their privacy and would have to move out of their comfort zone.

The changes undertaken at Baxter can be explained very aptly using Lewin’s 3 stage Change Management model:-

a) Unfreeze: - This first stage of change involves preparing the organization to accept that change is necessary, which involves breaking down the existing status quo before you can build up a new way of operating. Baxter considered the following individual factors that could offer resistance to change:-

1. Habit : Employees were habituated to their own personal spaces and privacy2. Fear of unknown : Employees were unaware of the repercussions of open office spaces3. Security : Lack of privacy compromised on the confidentiality of sensitive data

To overcome this resistance it used the techniques of:-

Education and communication: Management met with employees to orient them towards new workstations and to explain the design concepts behind them. For instance these offices were six square feet smaller than their previous offices, more efficient, with generous work surface, storage, and conference space.

Implementing change fairly: Baxter wanted the design of its new facility to support and even drive that spirit of change. The company knew it needed to accommodate the divergent expectations of several generations of workers, from the collaborative but workstation-oriented Boomers to the mobile, tech-savvy Millennials. Irrespective of the employee's designation, they were all given open workspaces ensuring everyone gets a fair treatment.

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b) Movement: - After the uncertainty created in the unfreeze stage, the movement stage is where people begin to resolve their uncertainty and look for new ways to do things. People start to believe and act in ways that support the new direction. At Baxter Employees didn't realize that new workspaces are smaller when they sit in them. They comment that the workstations feel more spacious. Baxter encouraged a more collaborative way of working and brought its leaders closer to the teams they manage. The high level of trust between employees and the management ensured smooth transition

Source : Hermen Miller (A Major American Furniture Manufacturer)

Project Scope : 372 occupants; 372 workstations;75,000 square feet

c) Refreeze: - When the changes are taking shape and people have embraced the new ways of working, the organization is ready to refreeze. The refreeze stage also needs to help people and the organization internalize or institutionalize the changes. As employees moved into their bright, new space, however, opposition died away. Open offices spaces were embraced by everyone enthusiastically and became an essential part of the Baxter work culture thus refreezing the change.

Power Politics and conflict resolution

The organizational hierarchy of Baxter is more or less flat in nature but in spite of that the people in management and decision making position enjoy power in the company.Bases of power

1. Legitimate power: It is the power enjoyed by people due to their position of authority in the organization , In Baxter legitimate power is enjoyed by people at different levels of management such as Director, Project manager, Business Unit Directors and General Manager.

2. Reward power: This kind of power is utilized by people in an organization to keep employees motivated so as to give out their best performance. In Baxter reward power is wielded by directors and project managers in forms of financial - promotions, pay rises and non-financial benefits - recognition and preferred assignments.

3. Expert power: It is showed by Team leads who have gained wide experience and knowledge in the business. By sheer virtue of their knowledge, skills and competence they enjoy the highest amount of expert power in the organization.

4. Referent power: People who have desirable resources or personal traits, such as Directors and Managers of different business units have huge referent power and are admired by employees all throughout the organization.

Anti- Sexual Harassment policy

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Baxter has a strong Anti-Sexual Harassment policy which clearly outlines all the activities which come under the purview of sexual harassment and enforces strong actions against the offenders. The framework for handling sexual harassment complaints is well established and easily accessible. The framework ensures that resolution of complaints takes place at the earliest and complete protection is provided to the complaint.

Political behavior

On interviewing the employees, we found that the company has got a very apolitical culture and any type of political behavior by the employees is strongly discouraged. The company puts great emphasis on creating an environment which prevents political behavior. It tries to eliminate out all possible factors which are common sources of political behavior such as a clear performance evaluation system, role clarity among employees and equal promotional opportunities.

Conflict Management

Baxter believes in the interactionist view of conflict, where it encourages an open dialogue between employees in a team, in the words of an employee “we agree to disagree “.This provides opportunities to all employees to put forward their views and make a meaningful contribution in decision making. Baxter promotes functional conflicts which drives the team towards superior performance and better goal realizations. Whenever a conflict occurs within a team, it is resolved through collaboration where they search for a mutually beneficial solution and which is in the best interests of the organization. They follow a problem solving technique of conflict resolution where parties meet face to face with the intention of identifying the problem and find its resolution through an open discussion.

The process as described by an employee is a follows “All the parties involved are good at their job and if they have a concern which conflicts then it is important to discuss it out. And if no resolution is achieved then one approach is taken as test with everyone reconvening to check if any corrections required moving forward.”

Organizational CultureBaxter is committed to be a great place to work and develop. It is part of the company vision. It recognizes hard work and provides employees with opportunities to expand their knowledge, enhance their talents and see their ideas come to life. The Organizational Culture at Baxter is based on its leadership expectations. The Baxter Leadership Expectations are the core values for every employee, every day, everywhere at Baxter. They provide clarity and inspires and motivates everyone to achieve results. It dominates the strong culture at Baxter. This integrated framework is used in hiring, assessing, training and developing employees at all levels and includes:

● Shared Values – the beliefs and standards brought to work● Competencies – the skills and knowledge necessary to achieve the goals● Personal Attributes – the characteristics and behaviors that enable people to be successful at Baxter

Global Inclusion and Diversity at Baxter

Baxter has a diverse employee population (representing different ages, genders, sexual orientations, races, ethnicities or religions). Along with inclusive culture Baxter has policies, programs, processes and systems in place that engender respect, value differences and enable all employees to work together effectively. Baxter believes that an inclusive culture and a diverse workforce can drive innovation, create trusted partnerships with customers, suppliers and community partners, and contribute to the success and sustainability of the business. These beliefs form the foundation of Baxter’s global inclusion strategy, which is directly linked to one of the

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company’s key shared values and leadership expectations—respect for individuals and the diverse contributions of all. Baxter has implemented many programs and policies to promote diversity at workplace. Few of them are:

Global Inclusion Council

The Global Inclusion Council provides leadership, guidance and support to enhance Baxter’s inclusive culture. Composed of leaders from the company’s various businesses, regions and functions worldwide, the Council’s charter is to:

● Promote and advocate Baxter’s inclusion philosophy and initiatives● Identify issues and barriers in the workplace that could impact an inclusive culture● Recommend new ideas or initiatives to accelerate an inclusive culture● Identify opportunities to leverage existing initiatives across the company● Ensure inclusion initiatives align to Baxter’s business priorities.

Inclusion and Diversity Training

All employees are required to complete inclusion and diversity online training designed to help employees understand why inclusion and diversity are critical to Baxter’s success. Also, all managers are required to complete an inclusion and diversity workshop so each manager plays their part in creating and sustaining an inclusive culture at Baxter.

Fair Opportunity for All Employees

Baxter is committed to provide fair opportunity for all employees and recognizes that every individual’s unique background and experiences contribute to the success of an organization. Discrimination in hiring, promotion and all other employment decisions on the basis of race, color, religion, gender, national origin, age, disability, sexual orientation, gender identity or expression, veteran status or any other basis protected by federal, state or local laws is prohibited. Baxter’s global operations comply with applicable laws and company business standards around the world. Employees are encouraged to raise any issues or concerns they might have through one of the channels fully outlined in the company’s “Prohibition of Workplace Harassment” policy.

Business Resource Groups

Business Resource Groups (BRGs) support Baxter’s business goals and aim to enhance personal growth and multicultural understanding, while strengthening relationships among employees and with customers and community partners. Baxter has five BRGs: “African-American Leadership Council,” “Asian Leadership Network,” “Baxter Equality Network,” “Building Women Leaders” and “Latinos@Baxter.”

Work-Life Balance

Baxter believes that managers and employees share the responsibility to achieve a healthy blend of work, personal and family life. Its global operations collaborate with external organizations, as appropriate, to develop and facilitate programs. Some of the work/life programs and resources are listed below:

Adoption assistance and reimbursement Back-up/emergency child and elder care Dependent-care flexible spending accounts Educational assistance, employee assistance and counseling programs Elder-care management services, Lactation rooms Resource and community referrals to local service providers for family, financial and work issues,

Childcare support options

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Webinars on topics such as stress management and parenting (in English but offered worldwide); and Alternate work arrangements.

Conclusion

Baxter International Inc. founded in 1931, has grown to a large business organization and has presence throughout the world. The organizational culture is more towards providing freedom to its employees and promotes innovation in the organization. It believes in grooming employees, who can monitor their steps, and are vigilant about the future. They are accommodative and believe in growth of their employees for organizational development. The company believes in open door policy and transparent work culture. Their idea of performance analyzation and goal creation is through Performance Management Objectives (PMO) to set clear roles for the employees along with their support. Every level of the organization has a balanced power and dependency equation, thus the power structure is quite fair and suited to the organization’s size. The diversity in a team helps in building a healthy conflict environment. As far as the conflict of interests is concerned, as told there is no policy of conflict stimulation for idea generation. However, conflicts are duly resolved with the involvement of HR and senior management.

ReferencesLinks:

http://www.baxter.com/about_baxter/company_profile/index.html http://www.baxter.com/about_baxter/corporate_governance/company_leadership/index.html http://www.hermanmiller.com/hm/content/case_studies/pdfs/CS_BAX_FULL.pdf http://www.glassdoor.com/Reviews/Baxter-Reviews-E83.htm http://www.baxter.com/about_baxter/company_profile/awards_and_honors.html http://ca.indeed.com/cmp/Baxter-Healthcare/reviews http://www.baxter.com/about_baxter/company_profile/

corporate_overview.html#regional_employee_breakdown http://www.baxter.com/about_baxter/company_profile/history.html http://www.baxter.com/downloads/investors/reports_and_financials/annual_report/2011/index.html http://www.humanresourcesonline.net/news/12023 http://www.crisilresearch.com http://www.glassdoor.com/Reviews/Baxter-Reviews-E83.htm

Books: Organizational Behavior by Stephen P. Robbins, Timothy A. Judge and Neharika Vohra Study material (presentations) shared by Prof. Gowri Joshi

Appendix

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Excerpts from the Telephonic Interview

Q) What is the process of taking any decision in your organization at group level, team level and company level?A) Any idea/innovation during the decision making is encouraged.Team level: At team level, people are encouraged to think innovatively and come up with solutions. There is a proper discussion at the team level, where the decisions are well discussed before submitting it to the Department level. The importance and effect of the decision basically decides the key members involved in the discussion.Department Level: At department level, the expertise of various managers and key members in the department is used to take the decision. For instance in case of a new process/idea, it is properly discussed looking in to the new process, the pros and cons, the changes in the new process compared to the legacy system. The various aspects looked in to can be benefits, time, training required, pilot run, phase run etc.Company Level: At company level the process, if it is a process that impacts the company wide aspects, will require the heads of each area impacted (Marketing, Business Research, Products, Quality, etc...) to come together and discuss. A prior knowledge will be provided and then there will be meetings as and when required, finally the decision to go ahead or stop will depend on the understanding among various department.

Q) What is the frequency of Appraisal meetings at Baxter? Are goal settings timely done by managers with the employees?A) Key Responsibility Areas are known as Performance Management Objectives (PMO) in Baxter. PMO meetings are held biannually at our organization.

Q) What is the process of setting a PMO for any employee?A) GM decides the areas that require the work and then he passes the details to the BUDs. The key areas are Customer, People and team, Innovation, Compliance, Quality and Finance.The BUDs then decide how the work has to be divided among the various heads. The PMOs of the managers are decided by BDUs.Before finalizing the PMOs, they are properly discussed with each employee. A one-to-one discussion in a meeting takes place, and it's discussed what all can be added, and what all can be reduced, and then the decisions are fixed.

Q) Is power and politics prevalent in the company? Any incidence of power and politics in the company?A) No, Baxter has an open culture where power and politics isn't encouraged at any level. The incidences of any power and politics are not seen or even heard about.

Q) What is the decision making process? Is it innovative/risk taking/step by step method?A) Being in an industry like healthcare, innovation is always looked up to. Innovation in product and processes is promoted, but then any new idea goes through a lot of check as discussed above. The various checks are put.

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Shivangi Gupta, born and brought up in the Industrial town of North India - Kanpur. She did her MBBS from G.S.V.M Kanpur Medical College. She was a topper of marketing in NMIMS, and got placed in Baxter India Pvt. Ltd. and has been a consistent performer there for last 5 years. She is currently based out of Sydney, looking into the ANZ region (Australia and New-Zealand).

On the other hand many of the decisions require step by step process, so we cannot put fingers on one process only.

Q) What is the Degree of Freedom given to the employees?A) Freedom of thought process is at the heart of the company and there is no micro management. People are given their tasks and responsibilities and they are free to go about it in their own way. In other terms, full task ownership is given to them. Any achievement or good work is well appreciated by the organization.

Q) Is there any procedure for conflict management? Does the organization believe in the concept of stimulating conflicts?A) There is no procedure as such, but the conflicts are handled in the appropriate way as they should be. The concerned senior is responsible for handling the conflict at the earliest and resolve it. If required, senior members of the company/ HR team is involved as and how the needs arises. Baxter does not believe in the concept of external stimulations of conflict for discussions

Table of responses of by current and ex-employees of Baxter

Sr.No.

Employee Designation &

Tenure

Company Pros Company Cons Advice to Management

Recommend to join

1. Training Manager (8 years)

Good Value System, processes, gender

diversity

Lack of transparency from senior Management

top management must implements company’s great value systems

Yes

2. Ex-Employee(8 years)

Good perks, better inter division understanding

Too much politics and favoritism

Give due recognition to people

Yes

3. HR Specialist(3 years)

Learning and ability to showcase skills

None as of now None as of now Yes

4, Ex HR Manager (3 years)

Good perks, strong purpose, developmental opportunities within department, global firm

Difficult movement in cross functions, stressful work environment in times of cost-cutting

None Yes

5. Senior Manager(10 years)

Dedicated workforce, good social workplace,

company loyalty to employees is higher

than competitors

No rotational roles so intellectual growth and change are impossible,

policy paralysis. Too many outdated products

consuming resources especially in R&D

Need to focus on the future of healthcare. Lifecycle

maintenance of cheap widgets is not sustainable

Yes

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6 Assistant Supervisor

(Former Employee)

Every day is different and challenging,

diverse group, coordination

among employees

Working in shifts, some teams working with

individual decision making rather than group decision

Better understand the problem of

employees

Yes

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