Aventis's Global Management Challenge

Executive Summary

Through the integration of Hoechst Marion Roussel and Rhone-Poulenc Rorer, Aventis is creating a truly global, inexorably interlocked network of drug discovery and development capabilities. The need to improve sales performance and increase capitalization--a defense against takeover--drove the merger. But the merger also gave it both more R&D resources and an opportunity to retool its process. As this question and answer session with Aventis's Frank Douglas, head of R&D, notes, the company is emphasizing the creation of capabilities through internal and external investments, rather than scale. The reconfiguration draws on Douglas's experience in HMR's previous, and far less successful mergers. Aventis has set clear project priorities and created interlocking R&D functions in the US, France, and Germany, with platform technology resources-wherever they're located-directed to priority projects. The result, Douglas believes, is a system that focuses on optimizing the global portfolio, not the site portfolio. The company's challenge now, and perhaps its biggest opportunity, comes from being a truly multinational organization. Aventis has core drug discovery and development sites in the US, France, and Germany, and has chosen to distribute decision-making equally among them. That facilitates outreach to academia and biotechs, but it's not the most efficient way to organize and requires extra time and work for communication.