Performance Measurement in the Pharmaceutical Industry: Dr. Reddy's Laboratories, Ltd.

This paper reports on the development of a new performance management system at a major pharmaceutical company known as Dr. Reddy's Laboratories (DRL). DRL is an international pharmaceutical company that has a commercial presence in 30 countries with headquarters in Hyderabad, India. The performance management system known as the Eight Pillars of sustainable operations goes beyond the typical performance measurement systems implemented by other pharmaceutical companies, in that it incorporates both environmental measures and corporate sustainability measures. These measures are described and the uniqueness of the system is discussed both in terms of operational performance and corporate social responsibility. The case study reported in this paper was conducted with major commitment from senior management and is based on data from the company's annual reports as well as interviews conducted with senior managers at different levels in the organization. The initiation and implementation of the system is highlighted along with the challenges encountered and the lessons learned. Finally, the utility of the system is examined both within the organization and external to the organization. Recent awards received by the CEO are described to note evidence of external validation of the system.