A Dose of Change

Face time with Kevin Sharer.

Age: 53
Family: Married, two children
Early disappointment: Poor eyesight disqualified him from becoming a Navy pilot
Science training before coming to Amgen: High-school biology, college chemistry
Total number of products Amgen markets in order to be the world's number-one biotech company: Three
Total sales of those three products in 2000: $3.2 billion

Kevin Sharer knows a thing or two about adaptability. He studied aeronautical engineering at Annapolis and planned to be a Navy pilot but was disqualified due to poor eyesight. He wound up where the sun never shines -- as chief engineer on a nuclear submarine. He spent his early business career at GE and MCI before becoming president -- and, last year, CEO -- of Amgen, the world's largest biotech company. Amgen makes three leading drugs, two of which are used to treat the debilitating effects of cancer therapy and dialysis.

Sharer's office at Amgen headquarters in Thousand Oaks, California is accented with Asian and military touches: Japanese screens cover the windows. Orchids bloom in clay pots. A statue of a Chinese soldier stands in one corner. And on the wall that faces Sharer's desk hangs a portrait -- of General George Custer.

When you came to Amgen without any biotech experience, you were in a tough spot. What did you have to do to win credibility at this company?

(laughing) Yeah, when the world found out that the best idea the leading biotech company had for a president was a guy from the phone business, there was some initial concern -- science is the ethos of this place. But it was not an illogical move eight and a half years ago. What my predecessor Gordon Binder said was that we're heading into a more commercially intensive, operationally intensive environment. We have lots of people here with strong science. We're short on people with basic business experience.

Were you the slightest bit scared, given the arcane nature of biotechnology?

Not the slightest. Moving among different environments has been a pattern in my life, and I've been able to succeed in all of them. To be the chief engineer of a nuclear ship, you have to be able to take the whole nuclear power plant apart in your head and know everything about its theory of operation, from the most basic nuclear physics through process chemistry. So I wasn't cocky, coming to Amgen. But I had no hesitation about my ability to learn the new technology.

You made a leap once before, from GE to MCI. Was that a difficult move?

Well, I made a mistake at MCI that was ultimately important in my success here. At GE, there was a presumption that a new general manager would make an impact on the business quickly. That if you run one business, you can run any business. So then I went to MCI. I was 40 years old and reported to the CEO.

Within a month or two, I came to him and said, "I think you all have misconceptualized this business, and we need to fundamentally reorganize this place." The fact that I was right didn't matter. What I hadn't done was build sufficient internal credibility.

And you realized that mistake?

Oh yeah. When I came here, I decided to become an insider before I started to make dramatic moves. In fact, I tried to avoid dramatic moves entirely, so that when people looked back after a year or two, they'd notice things were different, but they wouldn't see some big event to cause that difference.

Later on, when I had very strong expectations of being the next CEO, I put myself on a half-time sabbatical. I said, I'm going to learn everything I can about the science of research and development and its management.

It's pretty unusual to go back to school at that stage of your career . . .

For probably a year and a half, I was a steady student. I read textbooks and I spent a lot of time in the laboratories of our top people here. I hired my old firm -- McKinsey & Co. -- to be my tutor in pharmaceuticals and biotechnology. I'm glad I did all of that. I don't presume to be scientifically or medically qualified, but I can participate in any discussion now at the level I think a CEO ought to be able to participate.

You started out as a manager on a submarine. What's it like, working on a sub?

At times, it's enormously exciting and rewarding -- at least it was back in the late 1970s. I was lucky enough to be involved with the most intense Cold War operations that existed. If you've read any of the stories about what attack submarines did with respect to the Russian Navy, I did all that stuff.

So that was your first assignment on a nuclear submarine. For your second one, you supervised the construction of the Memphis. Everything from the keel up?

When I showed up, it was just a hull on the ways with nothing in it.

I was the chief engineer. I was only 27, and my responsibility was to train the crew and to be the accepting agent for the Navy as the Newport News shipyard built the ship. We tested all the systems and trained all the people. Taking a ship to sea for the first time was exciting.

That must have been quite a kick.

It was. There is a really powerful connection between a ship, the people who build it, and the people who first sail it. I noticed in the New York Times, when the Russian sub the Kursk went down, that the U.S. ship that was on station was the Memphis -- the ship I built. So it's still, all these years later, still out there.

You were a very young man at the time. How would you describe your management style now?

There is a certain mythology right now in the world that thinks the CEO is a kind of superman . . .

. . . the "Jack Welch" phenomenon . . .

That's a good way to put it. But in fact, this business is so darn complicated, and the decisions are so important, there is no one person alone who is going to be maximally effective in making those decisions. I want my executive committee -- the seven or eight top people -- to collectively run the company. I don't shirk the ultimate responsibility as CEO. But I don't want to make the decisions as the sole integrator. I want us to debate and really think through the major decisions about the company together.

So why do you have a painting of General Custer facing your desk?

(laughing) I found that painting when I was visiting Portland with my son, and I was struck by it. I thought it would be good for me to look at someone every day who was overconfident, who misjudged the odds and his own abilities, and who lost everything.

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