Culture (2953 words)

2.0 ABOUT THE COMPANY2.10 Background
Ranbaxy Laboratories Limited is one of the largest pharmaceutical company in India, which was incorporated in year 1961. It started by Ranbir Singh and Gurbax Singh, as a distributor for a Japanese Company called Shionogi. The name Ranbaxy comes from the partial names of Ranbir and Gurbax. Bhai Mohan Singh bought the company over from his cousins in 1952, and as a family business, took his son Parvinder Singh in to build the business in 1967. The company went through a significant transformation in its business and scale under his leadership.
On a more recent note, in 2008, Parvinder Singh?s sons Malvinder Mohan Singh and Shivinder Mohan Singh sold Ranbaxy to a Japanese Pharmaceutical Giant, Daiichi Sankyo. Operations however, is still divided into two divisions as Daiichi Sankyo, as the parent Company continues its major core business of research and developments of new Patent Products, whilst Ranbaxy, as its generic arm concentrates on the business that they are well versed with, which is the generic drugs (Off-Patents) division.
Ranbaxy Malaysia Sdn. Bhd., is a subsidiary of Ranbaxy Laboratories Limited (RLL) India, which hold more than 51% of its shares. Since its incorporation in year 1984, the Company had to overcome many diversities in the industry that contributed in losses in the Company financials in its early years of operations. Although Ranbaxy is marked the largest pharmaceutical Company in India, it is at an infant Start-Up stage Company in Malaysia in 1984. As a pharmaceutical Company, the main source of income is derived from sales of Generic Pharmaceuticals Products and sales of Active Pharmaceutical Ingredients.

2.11 Organizational Structure
Ranbaxy has Matrix Structure, as illustrated in Figure 1.1, in which people of the similar skill is pooled together so that they are able work together for a common goal. In Ranbaxy, It is divided into five functional departments which is Customer Service, Human Resource, Finance, Sales and Marketing.

2.12 General Composition
Even though Ranbaxy Malaysia is a subsidiary of RLL India, the management in Malaysia consist of Malaysian. There is a total of 109 staff in Ranbaxy Malaysia Sdn Bhd. As a sales organization, sales and marketing staff comprises 83% of the total staff.

The breakdown by competencies is as below.
Figure 1.2 Staff by Department
DEPARTMENTNO. OF STAFF
HUMAN RESOURCE2
FINANCE10
SALES82
MARKETING9
CUSTOMER SERVICE5
The breakdown by race is as below.

Figure 1.3 Staff By Race
DEPARTMENTNO. OF STAFF
MALAYS17
INDIANS69
CHINESE23
2.13 Product
Ranbaxy deals with sales of Generic Off Patent products and Active Pharmaceutical Ingredients (API) in Malaysia.

Its products includes:
Figure 1.3 Products Of Ranbaxy
Products
Anti-Infectives
Anti-Depressants
Anti-AIDS
Gastrointestinals
Anti-Virals
Anti-Rethrovirals
Anti-Histamine
Analgesics
Tranquillizers
Anti-Diabetics
Lipid Lowering Agents
Anti-Hypertensive
Cardiovascular
Over The Counter
2.14 Stage Of Business Of Ranbaxy
Since its incorporation in year 1984, the Company has to overcome many diversities in the industry that contributed in losses in the Company financials in its early years of Operations. Although Ranbaxy is marked the largest pharmaceutical Company in India, it is at an infant Start-Up stage Company in Malaysia in 1984. As a pharmaceutical Company, the main source of income is derived from sales of Generic Pharmaceuticals Products and sales of Active Pharmaceutical Ingredients.

Figure 1.4 Stages Of Business Life Cycle
As the Company progressed, they mark a bearable percentage in terms of growth of the Company at about 3-5% profits per annum in years 1990 to year 1994. In 1995, Ranbaxy Malaysia employed its new Managing Director, MR. T. Jeyabalan, who has served the position until today. Throughout his tenure as the MD of Ranbaxy, many transformation has been done to built the Company from a 8.2M Ringgit in revenues in 1997 to 108M Ringgit in the years 2009. Over the years, the growth rate of the Company is very substantially high with year 2005 to 2009 achieving growth of nearly 15% versus the growth of the pharmaceutical industry as a whole, which is recorded at 5.6% per annum. To date, Ranbaxy is at an Established Stage.
It is thoroughly believed throughout all the employees in the organization that the greatest contributor in the growth of the organization in attributed to its Managing Director himself, for being a visionary leader and able to adapt and adopt new changes for the growth and the betterment of the Company. The changes made has created a positive culture in the Company and its employees, great contributors in the success of the company.

2.2 CULTURE
2.20 Definition
According to Nahavandi & Malekzadeh (1999, p. 74), culture is defined as values that are commonly held among a group of people. It is a set of norms, custom, values and assumption that guides the behavior of the particular group of people, giving each group its uniqueness and differentiating themselves from other groups. We are strongly influenced by culture, in which determines what is considered right or wrong, it influences what and who we value, what we pay attention to and how we behave. Culture does not only effects beliefs and values, but also influences management and interpersonal styles.

In terms of organizational culture, Nahavandi & Malekzadeh (1999, p. 75) states that it is a set of values, norms and beliefs shared by the member of the organization. Culture in an organization provides itself with a sense of stability and order, and it provides a sense of belonging to the team. It also provides a sense of direction in the group and helps organize activities and set priorities.
2.21 Purpose Of Culture
Nahavandi & Malekzadeh (1999, p. 91), states that the purpose of culture in an organization is to provide a sense of stability and order, which helps its member to maintain a sense of purpose at time of crisis. Culture will also allow an organization to be able to distinguish itself from others, and it is developed over some time and it is strongly influenced by the organizations founder and leaders.

Four functions of organizational culture as discussed in Kreitner & Kinicki (1998, p.62-63) are to give members an organizational identity, facilitate collective commitment, to promote social system stability and to shape behavior by helping members make sense of their surroundings.
2.22 Model in Observing Organizational Culture
In order to understand organizational culture, thorough examining and observation of organizational culture is needed. There are four evidences which could give insight to the organizational culture in question, which is the understanding of shared things, shared sayings, shared doings and shared feelings. This is illustrated in Figure 1.1, Model for Observing and Interpreting General Manifestation of Organizational Culture. Through this Model, we are able to as a few questions pertaining to organizational culture and ultimately get more insights and evidence on the culture involved.

2.23 Elements Of Organizational Culture
Elements involved in Organizational Culture can be differentiated into 2 different sub-categories, which is explicit culture and implicit culture.
The Explicit culture are cultures that are clearly observable and known, which are the areas above the surface, as illustrated in Figure 1-2. McShane & Von Glinow (2000 p. 498-504) states that the psychical artifacts involved includes psychical structures, rituals and ceremonies, stories and legends and language.
The implicit cultures are not easily observable, although most organizational members are aware of the surrounding cultures and are able to describe it. This will include Core Values and Beliefs shared by the members or the organization about what is important and what is not. Another component of implicit culture which is hardest to observe are the Basic Assumptions, which are at the root of the value and behavior shared by its members. It deals with general philosophical issues that may and may not be directly related to business. Assumptions form a management philosophy which is the system of values about the nature of people and organization, as well as how the organization should conduct business. This view has been supported in the work of Nahavandi & Malekzadeh (1999, p. 92-94)
Figure 1-5 Elements of Organizational Culture
2.3 EXPLICIT CULTURE IN RANBAXY
2.31 PSYCHICAL STRUCTURE
2.31-1 Logo and Corporate Colour
Ranbaxy Malaysia Sdn Bhd, as a subsidiary of Ranbaxy Laboratories Limited bears the Company Logo, as illustrated in Figure 1.3. The corporate color is Orange, and its translates into its vibrance in business in the pharmaceutical industry..

Figure 1-6 Company Logo
2.31-2 Office Setting
Work areas in Ranbaxy are separated using cubicles. However, all employees are able to roam freely around the office areas for discussions. Formal discussions and meetings will usually be held in any of the two conference rooms available. There are offices available for each Manager and all of the Managers practice an Open Door concept, in which employees can freely see the Managers for any needed discussions.

2.31-3 Dress Code
As the company deals with customers who are Doctor?s and Pharmacist by profession, they need to be properly dressed. The Sales Executives and Sales Managers portray the image of the Company to its customer, therefore it is vital for them to dress appropriately. All of the sales people in the organization are required to wear long sleeves shirts with neck-tie at all times, while the management staff are required to follow this rule, except for Casual Fridays, where they usually dress to the theme colors of the day.

2.32 RITUALS AND CEREMONIES
2.32-1 Long Service Award
This award is given to each and every employee that has worked for five years in the company, and each and every five years consecutively. It is given as an appreciation on the services and contribution that they have made to the company. Usually it is given on sales meeting days, in which the whole sales and management team from the whole country is around.

2.32-2 Birthday Celebrations and Birthday Greeting Cards
Each and every staff in the organization will receive a Birthday Greeting Card personally signed by the Managing Director himself. At the end of the month, usually on the sales meeting day where everyone is around, a Birthday Cake will be brought into the conference room where the birthday boy or girl will be asked to come forward to cut the cake.

2.32-3 Appreciate Programme
Appreciate programme is a programme to appreciate personal contribution, events and successful projects which contributed in the success of the Company. It is not limited to just in Malaysia, but all throughout the Ranbaxy world. It is a yearly affair in which outstanding performances and projects are nominated, and a formal function is held to present the certificate of appreciation to the winners.

2.33 STORIES AND LEGENDS
2.33-1 The Bus Story
In Ranbaxy, the main story that created a lot of impact is the Bus story. It is often said again and again to remind the employees that there is a need for a common goal to achieve for each and every one in the organization. Everyone is in the bus, and the bus driver is driving them to their location intended, which is the goal of the Company. A stern warning is also given, that those taking the bus can go down anytime if they felt that they are not willing to contribute towards achieving the goals. This creates a lot of teamwork in the organization, which benefits the organization in many ways.

2.34 Language
Even though the composition of employees in Ranbaxy is about 63% Indian, 21% Chinese and 14% Malays, the common language used are English. Each and every employee are constantly reminded to not talk in their own language, as it will create misunderstandings that could have negative impact in the operations of the Company.

2.40 IMPLICIT CULTURES IN RANBAXY
2.41 CORE VALUES, BELIEFS AND BASIC ASSUMPTIONS
2.41-1 Collegiality
All the employees in Ranbaxy are explicitly united in a common purpose and they respect each other?s ability to work towards a common purpose. Everything is discussed so that each and every one will achieve a common understanding to achieve to goals at stake.
2.41-2 Competitive
Ranbaxy is very competitive and they always want to maintain as a market leader in the generic pharmaceutical industry in Malaysia. Ranbaxy has always been fast in launching new products ahead of the other generic pharmaceutical company, so as to penetrate the market sooner than the rest. This resulted in Ranbaxy getting and creating bigger market share, faster than the other companies in the industry.
The competitiveness is also portrayed as Ranbaxy have many successful First Month launches that reaches over RM 1 Million in sales, as there were no competitors having the products.

Ranbaxy?s competiveness is also shown in the rapid ever changing strategies deployed by the management. Sometimes, there will be changes done each and every few months so that they will remain competitive in the generic market in Malaysia.
2.41-3 Emphasis on People
A common problem in the management of a sales organization is the sales staff turnover. In Ranbaxy however, the management put a lot of emphasis on theirs people. A lot of sales training is given so as to complement the staff with the right knowledge of the products and selling skills. It is a common practice in Ranbaxy to hold formal Role Play sessions to enable the sales staff to learn to counter different questions that may come when they go out to meet customers.

Apart from Role Play, each and every staff is also needed to sit for an online test twice a month to further develop the sales person in terms of knowledge of the products.
The staff in Ranbaxy is also evaluated on a regular basis, and every excellence performances is rewarded through monetary and non monetary incentives. Promotions will be offered to outstanding performers so that they will be Sales Supervisors and Sales Managers.
A continuous education programme is also offered managers so that they will be able to improve further. They will be enrolled to further their MBA through distance learning programmes so that they will be able to perform their role better, and to take on extra task when they climb up the corporate ladder.

3.0 INDUSTRY OVERVIEW
The pharmaceutical industry in Malaysia and even the world for this matter consist of three segments which is the Research Based Pharmaceutical Company, Generic Drug Manufacturers and Over The Counter (OTC) Pharmaceutical Manufacturer.

Research based Pharmaceutical Companies, with its powerful capacity in Research and Development develops a new product or molecule from scratch, and patents in for a period of between 10 to 25 years. After expiry of patents, in which the patented technology is no longer protected by the intellectual property law, the Generic Pharmaceutical Manufacturers are able to market the same exact imitations of the products.

The competitive and technological changes in the pharmaceutical industry today, from the powerful new drug chemistries to innovative R&D partnerships and marketing plans are reshaping the business strategies of many pharmaceutical companies. Many companies today are searching for ways to increase productivity, decrease costs, and develop new treatment modalities that will enhance profitability.

Nonetheless, the characteristics of the key players in terms of their business culture, practices, norms and shared values are very much similar. Its characteristics will be discussed below.

3.01 Characteristics Of A Pharmaceutical Company
3.01-1 Innovative
Pharmaceutical companies have a very high expenditure in research and development to continuosly develop new products and re-engineer molecules so that they more potent and has lesser side effects. It is also the same for the generic companies, although just imitating, they currently are re-inventing the process of creating molecules, and patenting its Process.
3.01-2 Often Global Players
Most pharmaceutical company will have their presence in many countries, with some appointing local distributor to keep their revenues low. Manufacturing plants are also allocated around the world, with emphasis on greatly enhancing their production capacities through economies of scale.

3.01-3 Sophisticated Marketing and Sampling Activities
The general practice of many pharmaceutical companies is detailing or educating its users, either General Practitioner (GP) or the Pharmacist on the products. This is the role of the Medical Sales Representative (MSR), which is the front-liners between the customer and the pharmaceutical industry. The MSR?s go through intensive training and exams, and are usually not allowed to go to the field to meet customers if they do not thoroughly know and understand the products.

A marketing strategy often used are sampling of products the GP?s and Pharmacist, usually for Cardiovascular Drugs which are usually long term medication. In this ways, doctors prescribing this medications will have to continue buying the medication in order to fulfill the needs of his patients.

3.01-4 Educational Activities
A common practice for the pharmaceutical industry is also to conduct Continuous Medical Education (CME) to Medical Practitioners, so as to provide insights on the new developments in the pharmaceutical industry as well as to provide updates on products. This education programme is a platform for the pharmaceutical companies to communicate professionally with its customers.

4.0 CONCLUSION
Each and every organization has its own unique culture and value set which has been created unconsciously over a period of time, based on the values of the top management and brought downwards to each and every layers of the organization. The understanding of its culture is important as culture can be used as a competitive advantage at the development stages of the organization. A strong organizational culture can offer many advantages such as internal cohesiveness and cooperation, better communication between employees and greater commitment towards task, which could translate to the success of the organization. Therefore, more in-depth understanding of culture in the organization in vital and definitely cannot be ignored if an organization wishes to progress further.