The Challenge

The client, a prominent medical research institute, had experienced substantial growth over the past 5-10 years, nearly doubling its research income in that period. However, this rapid expansion was not always planned for, leading to significant redundancies and budgetary issues. The institute’s growth was primarily fueled by grant revenue, a source of funding that, while significant, did not cover the full costs of research activities. Unlike universities, the institute could not cross-subsidise these costs with teaching revenue or international student fees, nor were they eligible for research block grants. This led to a substantial funding gap and budgetary deficits. Dissatisfied with the level of expertise and innovative thinking in the market, the institute sought our assistance directly in developing a new, more sustainable strategy.

The institute’s main challenge was its over-reliance on grant revenue, which, despite bolstering growth, led to unsustainable financial practices and strategic misalignment. The grant-focused approach not only created budgetary deficits but also diverted the institute’s focus from serving its external stakeholders and beneficiaries effectively. The institute needed a comprehensive overhaul of its strategic and financial mechanisms to ensure sustainability, relevance, and impact in its research activities.

What We Did

In navigating the complex challenges faced by the institute, we brought our structured strategy design approach to the table. Our process involves 5 key stages, working from identifying the ambition, right through to implementing the change. Our approach was aimed at not just resolving the immediate financial issues but also at properly articulating the institute’s strategic orientation. Our approach – based in design thinking, ethnographic work, and grounded theory – served as the cornerstone for a comprehensive overhaul of the institute’s operating paradigm.

1. Structured Strategy Development Process: We initiated our engagement with the institute by facilitating creative exercises aimed at defining their organisational vision and purpose. This process involved a deep dive into the value creation mechanisms for various stakeholders and identifying the gaps between these values and the institute’s current operations.
2. Insight-Driven Rebuilding: Our conversations and anlysis revealed that the institute’s challenges stemmed in large part from its heavy reliance on grant funding. We embarked on a systematic reconstruction of the institute’s operations, covering aspects from funding and project execution to stakeholder engagement and organisational structure. Our approach employs a blend of design thinking, ethnographic research, and grounded theory to identify underlying issues, formulate and test hypotheses, and co-design sustainable solutions.
3. Focus on Sustainability and Impact: Together, we prioritised the financial sustainability of the institute and the impact of its research. Our strategy involved a strategic pivot away from short-term grant dependencies towards larger-scale projects that not only reduce administrative burdens but also amplify the institute’s research impact by addressing real-world issues.
4. Shift in Operational Paradigm: We facilitated a transformative shift from an ‘inside-out’ approach, where research priorities were internally driven, often by individual researchers’ agendas, to an ‘outside-in’ approach, ensuring that the institute’s research agenda is deeply responsive to community needs and geared towards delivering tangible benefits.

Outcomes

The new startegy is too new to show the full results it will have over time. However, it has already marked a pivotal shift in the institute’s trajectory, aligning its financial, strategic, and operational frameworks towards a more sustainable and impactful future:

• Strategic Alignment and Board Approval: The new strategy has garnered enthusiastic support from the institute’s Board and has been embraced by key teams and staff members, signaling a cohesive internal buy-in for the new operational paradigm.
• Programmatic Reorientation: The institute is actively transitioning to the implementation phase of its new strategy, focusing on delivering its inaugural programs under this approach. The aim is to rapidly and sustainably reverse the budgetary deficits, steering the institute towards a stable financial future.
• Sustainable Funding Model: The new strategy has led the institute to shift its operations from securing and supporting short-term project grants to a model that supports large-scale, impactful research programs. This approach not only ensures financial viability but also optimises resource allocation towards initiatives with significant real-world impact.
• Community-Driven Research Focus: The institute’s operational shift towards an ‘outside-in’ approach ensures that its research priorities are intricately aligned with community needs, enhancing the relevance, application, and impact of its research endeavors.

The strategic transformation represents a significant leap forward, not just in terms of financial restructuring but also in aligning its research focus with broader community needs. By adopting a sustainable, impact-oriented operational model, the institute is poised to not only rectify its budgetary challenges but also redefine its role as a beacon of rapid and impactful medical research.