Those at the helm of affairs in Daiichi Sankyo claim that they are enthusiastic

about forming a culture in which their employees feel challenged and rewarded,
and have the opportunity to exhibit their skills and abilities. They also stress on
proficiency, duty and responsibility.
Having become a progressively global player, this behemoth sized company
boasts about 17,000 employees in more than 20 nations. Around 50 per hundred
of those employees work in countries other than Japan. This means that the
cultures, customs and values of Group employees are wide-ranging. They nurture
a work environment that respects and builds on the many strengths of the
diversity of our people. To increase understanding across cultures, they
customarily exchange talent between Japan and other countries and regions.
The pharmaceutical industry requires creative thinking every step of the way. To
spark the most innovative approaches, they seek employees who are not afraid
of failure. They also promote innovation through teamwork, while acknowledging
individual strengths and differences.
They commit to keep the highest standards for employee treatment and
development and use the HR Management Philosophy as our model for
employee management within DS.
The Philosophy at Daiichi Sankyo
The Daiichi Sankyo group of companies positions their people as the most
important asset. The realization of the company's mission and vision and its
sustainable growth cannot be achieved without high level of commitment and aid
of employees. To ensure this, they have expressed the basic principles of HR
management
1. Organizational Principles
Daiichi Sankyo should be a flexible organization responding effectively to
changes in the business environment, and fostering a sense of unity within the
group of companies in order to enable its employees to realize the mission and
vision of their company.
2. Expectations of Leaders
DS leaders are expected to lead the team members of his/her organization to
realize their vision while fully understanding our mission
3. Basic Philosophy of Human Resource Management
Daiichi Sankyo will realize sustainable growth through innovation, integrity and
accountability. These values are generated through the effective management of
our people.
4. Compensation
We wish to develop a high performance culture where high level of commitment,
engagement and contribution are aligned and compensate on the basis of such
factors.

5. Recruitment and Development

We establish robust processes for recruitment, selection and talent development
and thereby attract, develop and retain the talent needed to respond to run the
business and also adapt to changing business needs and requirements.
6. Performance Management
Our goal is to maximize the potential of our people through effective
performance management. Performance management is primarily used as a
guideline to determine the level of compensation and reward, as well as used to
promote talent development. Various achievements and contributions generated
from diverse activities are recognized and evaluated appropriately.
7. Employment/Work Environment
We believe it is important for employees, who are aligned to the company's
values and contribute to the achievement of its mission and vision, grow with
Daiichi Sankyo in the long term. We provide a work environment where our
employees among the group companies can maintain high motivation and
engagement and promote an environment free from harassment and which
promotes diversity.
8. Employee/Labor Union Communication
We value two-way communication with our employees and their opinions. In
those countries where labor unions represent employees, the group values those
communications as well.
9. Roles of HR
Our ultimate aim is to recruit and develop talent and creating organizational
health and strength to make each member of Daiichi Sankyo group of companies
"a great place to work".
10. Roles of Management
The management of the Daiichi Sankyo group of companies commits to the
vision of the HR Management Philosophy and fostering an understanding of the
Philosophy to all leaders of the company.

When the major global innovator pharmaceutical businesses were acquiring or

joining forces with the wide-ranging pharmaceutical companies. Daiichi Sankyo
became the first major Japanese pharmaceutical company which tried out this
hybrid business model in that era. And to make that a reality it bought a
controlling stake in Ranbaxy which is Indias largest company on the basis of
general and global generic drug manufacturer and exporter of drugs. A host of
changes took place at the senior administrative level. Chairman - CEO Malvinder
Singh who was the grandson of the founder of Ranbaxy, resigned in May 2009;
Atul Sobti took over as CEO but resigned in the following year. He informed about
the disagreements with the Japanese company on the functioning of Ranbaxy.
Ranbaxy president and chief financial officer, Omesh Sethi also left the
incorporation quite early. The Japanese firm booked a loss of around USD 3.9
billion because of the acquisition in the third quarter of its fiscal 2008 and
recorded a net loss of U.S. $ 2.21 billion, fiscal year. With the acquisition, Daiichi
Sankyo managed to expand its global business and reduce the concentration of
assets in Japan from 78.96% to 53.7% in 2011. The Japanese firm had not fully
taken advantage of their vision of the value chain in an integrated hybrid
business model. The case presented here focused on the deal that was penned
between Daiichi Sankyo Ltds acquisition of Ranbaxy Laboratories Ltd, a generic
drug manufacturer in India. During the first decade of 2000, major innovator
companies in the drug industry were acquiring the generic drug companies to
boost their sales, maintain market shares, promote their drugs and market them
efficiently and at low cost. The main reasons behind these acquisitions were that
the Patents of most of the companies were about to expire by 2012, research
and development costs were increasing which increased the risks for producing
more drugs. Also the expiry of the drug patents meant that the generic drug
companies will soon start to manufacture these drugs and threaten the revenue
base of the innovator drug companies.
Generic companies were starting to sell the same branded drugs of innovator
companies at much lower prices which severely affected the profit margins and
revenues of innovator drug companies like Daiichi Sankyo Ltd. The US Food and
Drug Administration (FDA) considered these generic drugs similar in strength,
quality, dosage form and its intended use similar to the branded drugs of
innovator companies. Due to the burden on the budgets of the developed
countries, these countries welcomed the drugs of the low-prices innovator drug
companies. Increasing population of countries and to fulfil the health care needs
of poor people of these countries, these generic drugs were becoming more
important.
Therefore, to address these issues many innovator companies were searching for
strategies to minimize the threat caused by generic companies. Such strategies
included cutting the expenditures on research and development, entering new
markets, maintaining new generic facilities that would manufacture low-cost
generic drugs. To implement these strategies, the innovator started to acquire
the generic drug manufacturers so that synergies could be created in the areas
of marketing and sales, supply chain, manufacturing and distribution. This model

of integration of the innovator companies with the generic drug companies is

known as the Hybrid Model.
Given whats going on in Ranbaxy since its acquisition the companies would
have to embark on change management programme to become a truly
integrated hybrid business model.
From our increasingly diverse domestic workforce to the globalization of
business, cultural competence is arguably the most important skill for effective
work performance in the 21st century.
Managing cultural diversity in the workplace.
Culture refers to the values, norms, beliefs and traditions that affect the way a
member of a group typically perceives, thinks, interacts, behaves, and makes
judgments. It even touches sensitivities of time, which can impact daily
scheduling and deadlines. Get an overview of all key aspects of diversity at the
resource center.
Cultural competence, in brief, is the ability to interact effectively with people
from different cultures. This ability depends on awareness of ones own cultural
worldview, knowledge of other cultural practices and worldviews, tolerant
attitudes towards cultural differences, and cross-cultural skills.
Developing cultural competence results in an ability to understand, communicate
with, and effectively interact with people across cultures, and work with varying
cultural beliefs and schedules. While there are myriad cultural variations, here
are some essential to the workplace:
Communication: Providing information accurately and promptly is critical to
effective work and team performance. This is particularly important when a
project is troubled and needs immediate corrective actions. However, people
from different cultures vary in how, for example, they relate to bad news. People
from some Asian cultures are reluctant to give supervisors bad news while
those from other cultures might even exaggerate it.
Team-building: Some cultures like the United States are individualistic, and
people like to proceed alone. Other cultures value cooperation within or among
other teams. Team-building issues can become more problematic as teams are
comprised of people from a mix of these cultural types. Effective cross-cultural
team-building is essential to benefiting from the potential advantages of cultural
diversity in the workplace
Time: Cultures differ in how they view time. For example, they differ in the
balance between work and family life, and the workplace mix between work and
social behaviour. Other differences include the perception of overtime, or even
the exact meaning of a deadline. Different perceptions of time can cause a great
misunderstanding and mishap in the workplace, especially with scheduling and
deadlines. Perceptions of time underscore the importance of cultural diversity in
the workplace, and how it can impact everyday work.