Author: Matt Lawton, Executive Director, FSP Delivery, Syneos Health
Why Your Operating Model Should Reflect Your Company’s DNA
Imagine two biotechnology companies with similar head counts, clinical assets and growth plans.
On paper, they look alike. Operationally, they may have almost nothing in common.
One may expect to build significant development infrastructure internally, drawing on large-pharma experience. The other may have deliberately remained lean, relying on external expertise to advance a lead asset. One may have deep scientific and clinical expertise but limited regulatory infrastructure. The other may have an experienced development team but little global-program experience.
Both are small-to-mid-sized (SMID) biopharma companies. But SMID is a market segment, not an operating model.
That distinction matters when leaders at emerging and SMID biopharma companies decide which capabilities to build, own, access or partner for—and how those choices support where they are headed. Even when financing constraints narrow their immediate options, these same questions can help leaders invest intentionally and preserve future paths.
Look Beyond the Phenotype
Head count, pipeline size, development stage and geography are useful ways to describe a biotech. Think of them as its organizational phenotype: the characteristics visible from the outside. As with human traits, phenotype is also shaped by environment. Financial runway, competitive market developments, regulatory requirements and other external factors will influence what the organization can support and what it must prioritize.
Beneath those visible characteristics sit less obvious influences. What is the company’s origin story? Where did its leaders come from? What capabilities has it developed? What does it want to own? And where is it trying to go? For many biotechs, the origin story begins with a particular patient population, unmet need or personal experience. That purpose can help leaders determine where strategic ownership matters most and where external partners can provide execution, expertise or scale.
These characteristics form something closer to an organizational genotype. They help explain why similar companies require different approaches. Your operating DNA isn’t just where you came from. It’s also where you’re going.
5 Questions Reveal Your Operating DNA
1. Where did we come from?
Leadership experience can shape operating-model expectations. Executives arriving from large pharma may bring established ideas about infrastructure, governance and functional ownership. An academic spinout may begin with exceptional scientific depth but a different operational foundation. Understanding leadership experience reveals what exists today and what the organization may become.
2. What do we already do exceptionally well?
Biotech leaders should distinguish between capabilities that create differentiated value internally and those that can be more effectively accessed through others. A company may have exceptional scientific expertise while still developing clinical operations, data management or regulatory capabilities. The goal is to protect what differentiates the company and identify where external expertise can create strategic value.
3. What should we build, own, access or partner for?
This is different from asking what a company can build. The ability to build a capability does not mean the company should own it. Every capability decision is also a capital-allocation decision. The question is what the company needs to own, what it can access more effectively through others, and where a partner can help build capabilities the company may want to own tomorrow.
4. Where are we trying to go?
The intended destination changes the operating-model equation. A company building toward global development and commercialization needs a different capability road map from one intending to generate proof of concept and out-license an asset. With the right partner, a company can execute what it needs today while intentionally building the knowledge, capabilities and ownership it wants tomorrow. The operating model can be a bridge to the future state.
5. What has our partnership journey taught us?
A biotech that has primarily worked with consultants and niche vendors may approach partnerships differently from one whose leadership has extensive experience with a functional service provider (FSP) or full-service outsourcing. Before choosing the next model, understand what worked, what created friction, and what capabilities or knowledge still need building. The right strategic partner can help build a road map for the future, surface risks and anticipate pitfalls as programs advance or financing conditions change.
Don’t Simply Shrink Someone Else’s Model
Recognizing a company’s DNA also exposes a common mistake: assuming a SMID needs a scaled-down enterprise model. Large pharma has built infrastructure, systems, data, governance and capabilities appropriate to the scale and complexity of its portfolios. For a SMID, the question is which capabilities make sense for its own strategy and destination.
A smaller portfolio does not automatically require a simpler model. A biotech running two or three studies still has to integrate people, processes, technology, governance and external partners. It simply needs to do so at a scale and investment level appropriate to its business.
The answer may combine internal teams, modular capabilities, FSP and full-service support in different ways. What matters is not fitting the organization into a predefined category, but aligning the model with the capabilities the company has, the capabilities it needs to own, and the places where external expertise, speed, capacity, geographic reach or capital flexibility can create strategic value. The goal is greater intentionality, not simply more insourcing or more outsourcing.
Your DNA Evolves. Your Operating Model Should, Too.
There’s another reality: Today’s answer may not be tomorrow’s.
A financing round can change the runway, while a clinical readout may shift portfolio priorities. New assets or geographic expansion can introduce different capability requirements, and changes in leadership, licensing agreements or other strategic decisions can alter the destination altogether.
SMIDs should anchor their approach in the capabilities and decision rights they consider core, while drawing on external support as needs change. The goal is not constant redesign, but a durable foundation with flexibility as the portfolio, business and environment evolve.
A strong operating-model conversation starts with a clear understanding of the organization: Who are we today? What are we trying to become? What capabilities do we need to own? Where should we build, access or partner?
There is no standard blueprint for a biotech because there is no standard biotech. The operating model starts with understanding company DNA and direction, then provides a foundation that can adapt. It can support the company you’re building and help build it.