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From its start in 1982 as the Eastern Virginia Tissue Bank, Virginia Beach-based LifeNet Health has grown into the world’s only combined organ, biologics and life sciences company with over 1,400 employees, 165 patents and partnerships with top tier biomedical companies.
LifeNet is considered a “trusted provider of transplant solutions, from organ procurement to new innovations to bio-implant technologies and cellular therapies” with offices around the world, all dedicated to saving lives, restoring health and giving hope, according to its website.
But it hasn’t always been that way for the not-for-profit company. LifeNet President and CEO Rony Thomas shared how challenges arise when organizations seek to innovate during an RVA757 Connects webinar on May 3. The virtual innovation spotlight series is meant to advance economic prosperity in the Richmond and Hampton Roads region.
In addressing the topic of “What Makes Innovation Work,” Thomas said many corporate leaders talk about their personal interest in innovation but often fall short in the execution because they must also embrace renovation.
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Many leaders tend to think that innovative drive and robust funding can create innovative change, Thomas said. But leaders who jumpstart innovation might do so in a haphazard manner due to incomplete planning, isolated management and no systematic fashion in mind.
He stressed that it is not necessarily true that having a vision and capital is the key to innovation. He referenced Elon Musk achieving success with Tesla but not with Twitter.
LifeNet realized it had to organizationally renovate before it could innovate. When the company’s founder suddenly died in 2002, it was without its visionary leader and architect, Thomas said. At that time, competition was growing as federal regulations and best practices were necessitating more funding and LifeNet’s growth was plateauing. In 2003-2004, the organization released zero products and its viability and survivability were in question, he said.
Many factors inhibited LifeNet’s innovation, including more talk and less action, lack of shared vision, paralysis by analysis and inadequate reward system and aligned salaries, he said.
To examine what was wrong and change its dysfunction, LifeNet started by listening to all constituents and creating a group vision. In the process of growing a vision of change, Thomas said it’s important to prioritize and communicate those priorities. Leaders need to learn to say “no” while being transparent in establishing divisional goals and objectives and sharing all information —the good and the bad.
Inside Business
Following its introspection, LifeNet started rewarding high performers with better pay, delivered on budgeted priorities, ensured return on investment was measured in job satisfaction and not just money, promoted from within, provided training and stressed the need to be “we” and not “I.”
Risk-taking is another important ingredient in renovation and innovation, Thomas said. For example, he said the company’s board took a risk during the Great Recession when it approved the $30 million development of its Institute of Regenerative Medicine facility next to its headquarters in 2008. The result of that decision is a global center of excellence for research and development focused on new medical applications for allografts and tissue engineering. It also houses about 80% of LifeNet’s scientists.
Similarly, LifeNet took a risk when it developed a facility in North Carolina’s Research Triangle Park to meet the desire of scientists who wanted to work with LifeNet but didn’t want to leave the area. And now it’s a thriving operation, Thomas said.
Risk-taking also led to LifeNet’s involvement in the logistics of air transport. To solve problems of limited delivery by the only FedEx plane at the Norfolk airport, LifeNet built a life sciences facility in Indianapolis, Indiana, home to FedEx’s second-largest hub not far from UPS’ largest hub in Louisville, Kentucky. LifeNet now offers quick, responsive delivery anytime, anywhere.
The company is also participating in the vision to increase the connection between Richmond and Hampton Roads, in what’s being called the I-64 Innovation Corridor, Thomas said. LifeNet also operates in Richmond and plans to open its state-of-the-art organ procurement facility there in the coming months.