Talent, tech, and team: The formula for medtech R&D success

Medtech’s new ways of working

To address these challenges, medtech leaders are changing their talent models, organizational designs, and cultures. Here’s what our interviewees say worked best for their organizations.

Cultivating next-generation talent and leadership

Leading medtech companies strive to attract talent from the technology industry, which they perceive as more innovative and agile. These new hires can bring fresh perspectives and skills to medtech, especially in digital and software development. As one R&D leader mentions, “Distinguished engineers and senior principal engineers are no longer our main recruitment target; early talent is crucial now.”

However, because of regulatory complexities and deliberate decision-making, medtech moves slower than the broader tech industry, which can cause frustration among new hires and make retention difficult. For example, one R&D leader remarked, “New hires from technology firms talk with regulatory and quality and leave wondering how we ever bring anything to market here.”

To address this, many organizations are centralizing their innovation teams, which allows them to leverage the efforts put into hardware and software across multiple product portfolios. Others have streamlined their processes to sustain momentum and excitement among their new colleagues. Still others use different processes for various types of development. For instance, they may use an established process to develop firmware, ensuring reliability and compliance, while creating a mobile app with a faster, iterative approach.

It is one thing to bring someone in from the tech industry, but the true challenge is assimilating them to the culture and pace of medtech.

Respondents tell us that medtech R&D professionals need a broader skill set than traditional technical expertise. For instance, they must understand hospital workflows, patient needs, and how to integrate digital tools. Some companies are addressing this by hiring data scientists to work with real-world data and designers for patient journeys, integrating them into existing teams. To help data scientists make the transition to digital, many are hiring from industries with strong digital talent, including consumer electronics, automotive, and telecommunications, in addition to high tech. To maintain and nurture institutional knowledge, companies are ensuring they have strong in-house knowledge management systems. Furthermore, to support the growth of younger talent into leadership roles, they recognize the importance of having effective succession plans.

Companies are also exploring changes to their incentive structures. R&D team members have traditionally been compensated with a base salary plus a bonus or stock awards, depending on the company’s overall performance. Some firms are creating more individualized incentive plans that reward innovation and creative problem-solving to help align talent with organizational goals. Some—applying the idea that treating project teams as commercial entities can foster a sense of ownership and promote innovation—are incentivizing teams to bring products to market faster than they normally would.

The organization is only as good as its people. You need to be clear about what’s valued. If the team is aligned on the importance of innovation, innovation will become the new norm that drives commercial value.

Organizing for innovation

To overcome internal organizational boundaries and enhance collaboration and innovation, some companies are consolidating digital, cloud, and engineering functions under a single umbrella. Some are establishing platforms on which engineers with similar skills can work together across product families. Others are establishing centers of excellence (COEs) for disciplines such as AI and robotics. Platforms and COEs help ensure that expertise is not bound to specific business units but can be leveraged across multiple units and projects.

Some R&D leaders say they should have a strategic role in the company, ideally with a seat at the executive table. Innovation goals are often longer term than commercial ones, so putting R&D under the commercial banner creates tension: It’s easier to align goals if the teams are equals, but this requires R&D leaders to develop the business understanding to collaborate effectively with commercial teams. Some companies bridge the gap between technical and business roles by encouraging role rotation, including into strategic partnerships, to help employees gain full exposure to the business and enhance their decision-making and leadership capabilities. Some set common goals for technical and business staff.

Leaders identify the merits of centralized and decentralized R&D models. Centralized models can better foster synergies and talent development, while decentralized models can better cultivate specialization and speed. Companies can choose between them based on their innovation priorities and market demands.

Nurturing an adaptive culture

Some medtech R&D leaders say their organizations are undergoing subtle cultural shifts. As technical roles evolve, these leaders and their teams are changing how they work to require earlier interaction and more collaboration. And leaders are placing more value on employees with high emotional intelligence who can manage relationships and foster collaboration between teams and with customers. They believe that organizations seeking to align the corporate culture with strategic goals need to articulate clearly what they value, including responsiveness to customer needs, digital transformation, and connectivity.