lgc privatisation and development - · pdf file3 lgc history origins dating back to 1842 as...

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LGC Privatisation and Development

Dr Derek Craston Managing Director, Science and Technology, LGC Government Chemist

February 2013

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Agenda

•  History •  Current •  Key Facts on LGC Today •  Enablers •  Other important factors •  Summary

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LGC history

Origins dating back to 1842 as customs laboratory protecting excise duty payable on tobacco importation into the UK

Company established in 1996 on privatisation from government agency

Science organisation focused in providing quality solutions in areas relating to safety and public good

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LGC in 1994

Director, Resources Director, Biosciences & Innovation

Director, Analytical Quality

Specialised Techniques

Analytical Quality

Reference Materials

VAM Unit

VAM Business Management

Quality Manager

Forensic & Food Analysis

Questioned Documents

Food Imports & Exports

Drugs

Food Composition & Nutritional Surveys

Fertilisers & Feeding Stuffs

Food Analysis for MoD

Forensic Business Development

Biosciences

Microbiology

Analytical Molecular Biology

Government Chemist referee analysis under

the Food Safety Act 1990

BDG Business Development

IP Innovation Programmes

MT Materials Technology

SRU Research

Marketing

Computing Services

Technical Services

Accounting & Finance

Human Resources

THE GOVERNMENT CHEMIST

Environmental & General Analysis

Environmental & General

Chemical

Consumer & Transportation

Safety

Pesticides

New Projects

Safety & Environment

Project Management (LGC Safety

Officer)

Tobacco Products

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Remaining in 2013



Reference Materials

VAM Unit


Quality Manager





Biosciences






SRU Research

Marketing

Computing Services



Chemical

Pesticides


Drugs

Technical Services



Human Resources


Safety

New Projects




Microbiology




Officer)

Tobacco Products

Analytical Quality

LGC Today

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The genesis of today’s business


Reference Materials





Analytical Quality

VAM Unit


Quality Manager




Drugs




Biosciences

Microbiology







SRU Research

Marketing

Computing Services

Technical Services


Human Resources



Chemical


Safety

Pesticides

New Projects



Officer)

Tobacco Products

LGC Standards

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Biosciences


LGC Genomics



Microbiology Microbiology






SRU Research

Marketing

Analytical Quality


Reference Materials

VAM Unit


Quality Manager



Drugs







Computing Services

Technical Services


Human Resources



Chemical


Safety

Pesticides

New Projects



Officer)

Tobacco Products

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LGC Forensics


Drugs




Microbiology

Biosciences

Director, Resources




Director, Analytical Quality Director, Biosciences & Innovation




SRU Research

Marketing

Analytical Quality


Reference Materials

VAM Unit


Quality Manager




Computing Services

Technical Services


Human Resources



Chemical


Safety

Pesticides

New Projects



Officer)

Tobacco Products

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Pesticides


Safety

Drugs





Analytical Quality

Reference Materials

VAM Unit


Quality Manager Food Analysis for MoD


Biosciences

Microbiology







SRU Research

Marketing

Computing Services

Technical Services


Human Resources



Chemical

New Projects



Officer)

Tobacco Products

LGC Health Sciences

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LGC today

LGC Forensics •  Full-service

forensics •  Crime scenes •  Pathology •  Drugs •  Occupational drug

testing •  Toxicology •  Fluids, marks, stains •  Fire investigation •  Documents •  DNA profiling •  Firearms •  Computers &

phones •  Archaeology

LGC Genomics •  SNP genotyping services

& instrumentation •  Sanger sequencing •  Next generation

sequencing •  DNA extraction kits &

services •  RNA extraction services •  Enzymes & PCR mix •  DNA shearing

instruments •  Microtitre plate sealers •  Thermal cyclers •  Assay dispensers •  Workflow management

software

LGC Standards •  Reference material

production •  Cell lines &

microbiol. products •  Proficiency testing

schemes •  Custom reference

materials •  Reference material

distribution •  Outsourcing of in-

house reference standards groups

•  Analytical training courses

•  Government Chemist •  Regulatory laboratory outsourcing, MHRA and BP •  Regulatory monitoring, e.g. environment and BSE •  External science programme management •  Training & consultancy

LGC Health Sciences •  Food, pharma,

sport & consumer products

•  Occupational drug and banned substance testing

•  Characterisation of impurities, contaminants & residues

•  Foreign particulates, extractables & leachables

•  Nutritional biomarkers •  Nutritional testing •  Trace metals

•  National Measurement Institute •  Calibration services •  Production of certified reference materials •  Contract research

LGC Science & Technology

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Facts 1: Ownership and shareholder value

•  Privatised as a management led buy-out –  RSC, 3i and management and staff as equal shareholders

•  Change in ownership in 2004 to Legal and General Ventures –  Many staff remained shareholders –  Phantom shares

•  Now owned by Bridgepoint –  Transaction completed in 2010 –  Management + phantom shares

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Facts 2: Performance

●  Revenue has increased from £15m in FY96 to £170m in FY12

●  Profitability has more than trebled since 2004

●  Full time employee numbers have risen seven-fold since privatisation

●  Science quality retained and has been an important ingredient of our success

SWEDEN

Borås

FINLAND Turku

Berlin Luckenwalde

Almere

Wesel Cologne

Lomianki

Brno

Szentendre Cluj-Napoca

Molsheim GERMANY

CZECH REPUBLIC

POLAND

HUNGARY ROMANIA

ITALY

FRANCE

BULGARIA Sofia

Milan

Barcelona

SPAIN

NETHERLANDS

RUSSIA St Petersburg

CHINA

Beijing

Shanghai

TURKEY

Istanbul

Dubai INDIA

UAE Delhi

Ahmadabad

Mumbai

Goa Bangalore

Hyderabad

Edinburgh

Wakefield Leeds

Bury Runcorn

Risley

Tamworth

UK

Culham

Exeter Sandwich

Hoddesdon St Neots

Belfast

N. IRELAND

IRELAND

Fordham

Twickenham Teddington

Beverly USA Lexington Denver

Manchester

Sao Paulo

SOUTH AMERICA

Johannesburg

SOUTH AFRICA

Facts 3: Geographic Expansion

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Enablers 1: Leadership and People

•  Visionary leadership was critical – without organisation look very different now

•  Recruitment of industrial experience –  Market knowledge and expertise –  New skills/competencies –  Relationships

•  Investment in people from outset –  Ashridge training –  Internally generated programmes

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Enablers 2: Investment •  Acquisition

–  LGC Standards (Promochem Group; Mikromol; QM / Aquacheck, Breitländer; Cardiff Bioanalytical Services; Industrial Analytical (SA); Analytical Reference Materials International (ARMI: USA); VHG Labs Inc; Bio Senate)

–  LGC Forensics (Forensic Alliance; Institut für Blutgruppenforschung (IfB); Focus Forensics; Kalagate)

–  LGC Genomics (AGOWA; Kbioscience) –  LGC Health Sciences (HFL Sport Science;

Quotient Bioanalytical Sciences)

•  Organic Growth –  Science and instrumentation –  Infrastructure (new sites, IT)

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Enablers 3: Change management

•  Essential in the early years and continue through to the present

•  Key areas needing addressing were: –  Customer focus (at all levels of the organisation).

Commercial and financial skills –  Science –  Operational efficiency and excellence –  Brand development –  People (as in previous slide)

•  Central initiatives and teams created to address these –  “Pentagon” –  Process and Operational Efficiency Team

•  Continually needs refreshing

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Other important considerations

•  Government guarantees and a reasonably positive economic environment in the late 90’s and early 2000’s were helpful to success

•  While there can be complexities of hosting critical government functions in privatised organisations; for LGC (and Government) benefits have outweighed governance requirements

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Conclusions

•  LGC successfully transitioned to the private sector and has created value from its capabilities and science investment whilst delivering greater efficiency in its Government work

•  Science institutions in government should: –  Deliver government remit efficiently and meet evolving

requirements –  Generate commercial value from the science generated through

the public purse

…. for LGC privatisation provided the freedoms and backing to do this ….. but beware of direct read across