There is a growing trend at emerging life science companies to adopt a ‘Virtual Workforce’ model in order to keep head count and capital burn rate down, and flexibility up.  Instead of hiring full time employees to fill department roles, companies are bringing on the appropriate level of talent via consulting firms, resource companies, or hiring contractors directly. Even some manager level roles are being filled this way. Some companies run virtually by design, while others do so because experienced FTE resources were simply impossible to find when they needed them.

Using a virtual team makes sense in many cases because this approach gives companies a fair amount of flexibility. This is especially true during periods when non-recurring work levels are very high. For example, some companies need to ramp up resources as business processes and SOPs need to be developed prior to commercialization. When this work is complete, a smaller amount of resources are need for upkeep. Work traditionally done by employees such as supply chain management, CMC, project management, quality, and information technology management is being performed by contractors at a rapidly growing rate. For the past couple of years everything from the procurement functions to cross-functional NDA submission management is being handled by virtual teams. When the work is complete, or if the company experiences approval or other product launch delays, it is easier to scale back contractor levels than to lay off FTEs.

Certainly there are potential downsides to using contractors in FTE roles. If a company does scale back resources for whatever reason, re-engaging the same contractors who gained company, process, and product knowledge during prior engagements may not be possible. Therefore, locating new contractors and starting the learning curve again becomes an issue. However, if contractors are sourced through a life science specific firm then these challenges are minimized.

The virtual workforce will continue to be a rapidly growing resource strategy at emerging life science companies especially while capital remains tough to raise and its use scrutinized by boards of directors.

What model does your company use and why?  What challenges have you experienced?

Todd Martin

Tags: Business Strategy, Human Resources

This entry was posted on Tuesday, February 2, 2010 at 2:45 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site, or  Forward