feature A new application of value-stream mapping in new drug development: a case study within Novartis Mareike Heinzen 1 , mheinzen@ethz.ch, Samuel Mettler 2 , Annina Coradi 1 and Roman Boutellier 3 In this case study, we evaluated the effect of colocation on the drug development process using value- stream mapping (VSM) on the Novartis Campus in Basel, Switzerland. We compared a colocated team with a control group that was not colocated. The data showed that colocation was not associated with increased process speed in terms of lead lines. However, the colocated team communicated more and reported beneficial experiences, such as faster working processes or improved mutual understanding. VSM workshops revealed not only performance indicators about colocation, but also enhanced communication and cooperation through the evolving discussion. Introduction Within the past decade, research productivity (i.e. research output per dollar spent) of new drug development (NDD) in the pharmaceutical sector has been decreasing [1,2]. Growing re- search and development (R&D) expenditure, expiring patents, and the rising cost per indi- vidual drug could be improved by more effi- ciency in drug development projects [3,4]. A particularly crucial factor is the success rate of substances entering the late clinical stages. Most costs arise from failed drug candidates entering the later phases, but not resulting in a successful drug [5]. Therefore, efforts to increase R&D ef- ficiency and effectiveness are attracting more managerial attention. Several scholars, as well as practitioners, ap- proach this issue with concepts of lean man- agement, six sigma or total quality management to increase process efficiency for ultimately shortening time-to-market, increasing quality, and reducing costs (e.g. [5–7]). Others focus more on the effectiveness paradigm and want to find the right target and process as early as possible through timely communication and collaboration in project teams [8]. NDD is a core capability of our case-study company Novartis. The company has built a ‘Campus of Knowledge’ on its Swiss site in Basel, both with new and renovated buildings, in- cluding different workspace designs. Its strategy is to exploit the vast body of ideas that already exist in particular functions and disciplines through cross-functional and interdisciplinary colocation. As well as its accepted use as a lean management tool, VSM is also used to increase process efficiency, mainly in production envir- onments. We know from R&D projects [9,10] that VSM is also a useful tool for evaluating knowl- edge exchange and organizational learning. Here, we use VSM to evaluate whether the colocation of different functions affects process effectiveness and efficiency compared with a control group that is not colocated. Communication and collaboration through colocation The concept behind colocation is the enabling of interaction between members of different departments, with different functions and from different disciplines. Interaction can refer to communication or collaboration. According to Allen [11], communication can have three dif- ferent purposes: type I communication is about coordination; type II communication is about information and keeping staff up to date in their field; and type III communication is about in- spiration and is required for creativity. Type III is the most unpredictable and most difficult to manage. Collaboration is about working with one or more people to achieve a goal to leverage the group’s shared mind and, similarly to com- munication, can take place formally or informally Features  PERSPECTIVE Drug Discovery Today  Volume 20, Number 3  March 2015 PERSPECTIVE 1359-6446/06/$ - see front matter ß 2014 Elsevier Ltd. All rights reserved. http://dx.doi.org/10.1016/j.drudis.2014.10.009 www.drugdiscoverytoday.com 301