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With a €2 billion valuation on the stock market and annual revenues of €1.2 million, UDG Healthcare has the financial muscle to weather a storm. Plus, as the firm’s chief executive Brendan McAtamney acknowledges, with life expectancy and demographics increasing, UDG is operating in a safe harbour industry.

The Dublin-based healthcare service provider employs 9,000 people in 29 countries and is organised across two divisions. The first, Sharp, is a global leader in contract clinical, manufacturing, packaging, and technology services. Sharp accounts for 30 per cent of UDG’s profits.

The second, Ashfield, provides healthcare advisory, communications, commercial and clinical services, and accounts for around 70 per cent of UDG’s profits.

The company is well-diversified geographically – 64 per cent of sales are in North America, 19 per cent in the UK, and 17 per cent in the rest of the world. McAtamney believes acquisitions and their successful integration with the UDG infrastructure and culture has been a clear driver of progress. Indeed, 98 per cent of the leadership teams (at all levels) have completed UDG’s values-based leadership program called Inspire.

The impact on the markets UDG serves has been insignificant, and the well-established practice of the pharma industry outsourcing many of their activities underpins the longer-term growth opportunity for UDG.

However, McAtamney says the firm adapted to fulfil the continuing strong demand. Sharp, which has four plants in the US and three in Europe, saw its ability to function impaired due to Government regulations to manage the pandemic, and also absenteeism. Some of this was due to illness, but some also related to employee anxiety.

Demand for services from Ashfield was more impacted by the reduction of field-based activities such as sales rep visits, nurse visits, and meeting and events. These restrictions posed a threat to the ability of the UDG companies to meet customer commitments and expectations.

The outlook for UDG is positive; the leadership team is determined the business will not sleepwalk back to what was normal.

The response

Faced with a significant threat, UDG and the businesses adapted quickly. The leadership team remained calm; they highlighted the fact that there would be both market opportunities and challenges for UDG by the COVID-19 crisis. Staff were focused on addressing the operational challenges.

A global business continuity team was formed, which met frequently. Communication was actively increased, as was access to the leadership teams. This was designed to ease staff anxiety and reassure customers and stakeholders.

Some staff were furloughed but this was less than 10 per cent of the workforce. Additionally,

  • 60 per cent of Ashfield staff shifted from office working to home working (the technology to enable this was already embedded) 
  • Field-based staff, who were no longer able to conduct face to face engagements with customers, switched to virtual /remote engagement 
  • In Sharp commercial and office staff adapted in the same way as the Ashfield staff. The production facilities continued to operate with increased health and safety oversight and staff incentives

The impact

The only piece of Ashfield business noticeably affected was the field-based activities. Meanwhile, Sharp’s business recovered over four to six weeks and was quickly back close to budget levels.

In Sharp, opportunities to improve productivity and automate were identified, which the company had not considered previously. This was triggered by the need to recover some of the lost efficiency and resulting in increased cost.

There are other fundamental changes which are likely to remain such as increased virtual engagement with clients, increased working from home, and a reduction in the amount of air travel.

The outlook

The outlook for UDG is positive; the leadership team is determined the business will not sleepwalk back to what was normal. Instead, the ‘new normal’ of today does not represent a destination, but it is the starting point for a journey to ‘new normal’.

There have been fundamental changes to the way staff work in UDG, which enhance the businesses capability to deliver for its client base. The leadership is determined to retain these but, simultaneously, recognises that much is lost when staff who were working in congregate settings switch to only remote working.

Employees can lose the informal social interaction, communication, and mentoring which comes through osmosis in a congregate setting. How does a new recruit work from home and learn the culture of the business and ‘the way we do things’?

Read the report

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