Grow Talent, Grow Brands

Month: October, 2012

10 Strategic Performance Review Questions

Everything we do has an outcome in life. In business too it is our activities that determine and dictate the outcomes. A performance review, therefore should co-relate activities with results to find out the ‘how’ of improving performance. Successful managers – be it sales managers, regional managers, area sales managers ask these ten basic performance questions and apply their knowledge of their territories, people, customers, and activities to gain insights for improving performance continuously. Ask and answer these questions on the first working day of each month and prepare a winning action plan for improving performance.

  1. What did you plan to achieve in the month that has just ended and what did you achieve? What is the surplus or gap like? If it is a surplus how do you plan to sustain it further? If there is a gap how do you plan to cover it this month?
  2. What is the performance cumulatively? How many territories are on target? How many territories are around 90%? How many are around 80%? What is your plan to bring up all the territories which are 80% or above to 100%? And by which month?
  3. Which product groups are on target? How many are around 90%? How many are around 80%? What is your action plan to bring all product groups which are 80% or more to 100%? By which month?
  4. Now about the activities of you and your team. What is your call average? Remember your call average is important as it sets the standard for the team. How many of your team members are achieving prescribed call average norms? How many are below? What are the reasons? What would you do to ensure that achieve the standards from now on?
  5. What about customer coverage? How many of your team members (including you, remember, you are the captain of the team) have achieved the customer coverage as per the prescribed standards in terms of specialty-wise call frequency?
  6. What is your team’s performance in terms of prescription generation both in terms of prescriber-base growth and prescription increase territory-wise? Have you gained or lost? Analyze territory-wise and prepare an action plan to improve in the current month.
  7. What is the total value of business you have obtained from your key customers? Is it according to the plan? Is it more? Or less? If it is more how would you sustain it? If there is a gap, what is the gap like and how would you bridge it?
  8. What is your success rate with your retention customers? Is it according to the plan? What  are your objectives and action plans for retention customers for  in this month? What is your strike rate in terms of customer conversion? Did you achieve your objectives? How many customers did you convert and what is the total prescriptions and business you have got from each customer? What is your plan to retain the converted customers and  for new conversions? What help do you need?
  9. What is your plan for earning incentives for self and the team? Remember, the incentive plan is not just achieve the numbers, but also to ensure that all the criteria of eligibility are met.
  10. What is the status of slow and non-moving products? What is your specific action plan to create demand for these products immediately to prevent them from dying on the shelf and the consequent monetary loss.

Remember, the strategic performance review is not for making a presentation to your managers across the hierarchy or for the consumption of regional, zonal or head office. This strategic performance review is review of you, review for you and review by you!

Creating a Personality For Your Brand

Brands are like people. They have a personality of their own. They cannot survive for long in the minds of the consumers for long without a distinct personality of their own. They may not be able to enter the consumers’ mind without one. What is a brand’s personality? A brand’s personality is a set of human characteristics associated with the brand besides having demographic features such as age, gender, socioeconomic class. These are psychographic and emotional characteristics, which give your brand the additional dimensions to make them akin to a human personality so that consumers can identify with your brand. You, as a brand manager need to decide on the personality type, personality traits, and the values for your brand and create a brand with those in mind. Jennifer Aaker suggested that there are five personality types with their respective traits that are universally applicable to brands.

Personality Type Personality Traits
1. Excitement Carefree, Spirited, Youthful
2. Sincerity Genuine, Kind, family Oriented, Trustful
3. Ruggedness Rough, Tough, Outdoorsy, Athletic
4. Competence Successful, Accomplished, Influential, A leader
5. Sophistication Elegant, Prestigious, Pretentious

A brand personality is thus something a customer can relate to. You have to decide based on all the facts, qualities, capabilities, attributes that your brand has, and what could be and what should be its personality keeping in mind the needs and wants of its target audience in mind. Consider these questions as a quick check:

  1. If The Economic Times were not a financial and business newspaper but a person in flesh and blood like you and me what kind of person would The Economic Times be? Young or old? Male or Female? Educated or uneducated? Graduate, postgraduate, or doctorate? Rich or poor? Urban or rural resident? Tough or gentle? Every time when this exercise is done in brand management workshops, the personality that came out of the respondents was nearly unanimous – Urban male, Post graduate, Upper middle class to rich, middle aged.
  2. If Johnson & Johnson Baby Care product range were not a brand but a person in flesh and blood like you and me what kind of person would Johnson & Johnson Baby Care Product range would be? Young or old? Male or female? Educated or uneducated? Graduate, postgraduate, or doctorate? Rich or poor? Urban or rural resident? Tough or gentle? Like in the case of The Economic Times Exercise, every time these questions were asked in a brand management workshop, the respondents carved a near unanimous personality for the Johnson &Johnson Baby Care brand as a caring mother.
  3. Now ask these questions for one of the most successful antibiotic brands – Cipro, the power of parenterals, the freedom of oral dosage. Is it possible to visualize a personality for the brand? Of course yes! It would be a tough, athletic, energetic male with compassion and leadership qualities. This should help you immensely in designing the most important imagery and communication strategies to reinforce the personality characteristics and go whole hog in promoting vigorously till it results in positive consumer perceptions as you intended them to be.

Do this exercise for every brand you want to build. Once you visualize the brand personality based on all its strengths, capabilities, qualities, values, you would be able to create the most appropriate imagery, communication and the works to reinforce the intended brand personality to etch firmly in the mind of the consumer.

Remember, creating a brand personality is your only weapon of sustainable differentiation against competition. Sustainable because one cannot copy a personality!

Are We Aligning or Aping?

The Drug Controller General of India (DCGI) has stated that manufacturing licenses will only be issued based on generic or chemical names, and not on brand names. Archana Shukla recently reported that industry is divided on whether this is fan indicator of the government’s move to push generics eventually banning the brand names for drugs.

The matter seems to have been clarified with the DCGI at least for the time being as stated by the Indian Pharmaceutical Alliance’s secretary general, DG Shah. The main aim of this circular is to align ourselves to international standards and separate manufacturing licenses from trademarks. It is a step to deal with the similar-branding issues, as many brand names sound similar for a number of drugs currently on the market. It is not to eliminate brand names.

While this ends the ban-on-brand-names-for-drugs speculation a number of questions and concerns remain. The government has ordered the public sector doctors to prescribe only generic names and not brands. In a country where over 90 per cent of the drugs consumed are branded generics how can the move from branded generics to generic-generics possible. Not only that, most of the countries pharmacies are staffed by unqualified personnel. How will they dispense chemical names and contend with difficulties of this change? Furthermore, more than 50 per cent of the drugs currently used are combination drugs. How will the doctors prescribe a combination drug as a generic?

There is more to international standards than merely changing over to generic prescriptions. The entire eco system of the highly regulated markets is different. In the US, which is the biggest market for generics there are innovator drugs or brand-name drugs, branded-generics and generic-generics. The prices of brand-name drugs are out of price control as the drug discovery costs and risks are very high and the drug companies have to recover the investments before their patents expire. The first-to-file and first-to-enter the market generic drugs too have a window of 180-days of exclusivity during which period the prices are much higher than the generic-generics. The prices of generic-generics of course would be much lower.

The next question concerns the quality of the generics. There are not so many generic variations after the patent expiry. There are very stringent quality control measures to ensure that the generics are effective in treating the patients. Every generic drug should submit a bio-equivalence test comparing it with the innovator drug as they believe that therapeutic equivalence is important and chemical equivalence does not necessarily mean that it is therapeutically equivalent. Moreover, the generic applicant should conduct this test at the US FDA approved laboratory only. All this costs a lot and puts an entry barrier for fly-by-night operators.

Contrast this with the current scenario in the Indian drug regulatory environment. The technical infrastructure is not comparable and is not ready to ensure all these quality issues. Many of the reported close-to-ten-thousand drug companies do not have a manufacturing facility that conforms to and approved by WHO GMP (World Health Organization’s Good Manufacturing Practices).  Under the loan licensing system literally anyone with less than a million rupees can start a company marketing his own version of generics. As a result, there are companies competing at international level, national level, regional level and even local level as there are no barriers to entry. No safeguard to quality.

Yes, it is a level playing field where products with assured quality and not-so-good at quality can survive and have equal opportunities to co-exist! In such a hyper-proliferative market, without adequate infrastructure for testing and checking quality, how will the DCGI ensure that the patients get the same quality of generic-generic that is identical to that of the brand-name drug? A brand-name manufacturer has got his entire reputation at stake. What does a generic-generic manufacturer, who is new to the business has got?

All this makes one think and ask “are we aligning ourselves to international standards or simply aping them?”

The Penalty of Leadership

In every field of human endeavor, he that is first must perpetually live in the white light of publicity. Whether the leadership be vested in a man or in a manufactured product, emulation and envy are ever at work. In art, in literature, in music, in industry, the reward and punishment are always the same. The reward is wide-spread recognition; the punishment fierce denial and detraction. When a man’s work becomes a standard for the whole world, it also becomes a target for the shafts of the envious few. If his work be merely mediocre, he will be left severely alone – if he achieves a masterpiece, it will set a million tongues wagging. Jealousy does not protrude its forked tongue at the artist who produces a commonplace painting. Whatsoever you write, or paint, or play, or sing, or build, no one will strive to surpass, or to slander you, unless your work be stamped with the seal of genius. Long, long after a great work, or good work has been done, those who are disappointed or envious, continue to cry out that it cannot be done. Spiteful little voices in the domain of art were raised against our own whistler as mountebank, long after the big world had acclaimed him its greatest artistic genius. Multitudes flocked to Bayreuth to worship at the musical shrine of Wagner, while the little group of those whom he had dethroned and displaced argued angrily that he was no musician at all. The little world continued to protest that Fulton could never build a steamboat, while the big world flocked to the river banks to see his boat steam by. The leader is assailed because he is a leader, and the effort to equal him is merely added proof of that leadership. Failing to equal or excel, the follower seeks to depreciate and destroy – but only confirms once more the superiority of that which he strives to supplant. There is nothing new in this. It is as old as the world and as old as the human passions – envy, fear, greed, ambition, and the desire to surpass. And it all avails nothing. If the leader truly leads, he remains the leader. Master-poet, master-painter, master-workman, each in his turn is assailed, and each holds his laurels through the ages. That which is good or great makes itself known, no matter how loud the clamor of denial. That which deserves to live – Lives.

Cadillac Motor Car Co., Detroit, Michigan

Acclaimed as probably the best advertising copy ever written, this Cadillac Ad copy is also the best-ever piece written on leadership in general. It is applicable to leaders and leadership roles as to what makes them and what is expected of them. Written by the legendary copywriter, Theodore F. McManus, this ad  contrary to the popular belief appeared only once – on January 2, 1915 in the Saturday Evening Post. In all the years that followed millions of copies of this ad have been distributed around the world.


Three-Legged Stool 2

Where Are We Going?

The Indian pharmaceutical industry has come a long way since its humble beginnings at the time of independence. Legislation played a key role in the remarkable progress that the drug industry made over the years. The industry has been a net exporter for many years now. The recent changes that are proposed such as ban on brand names for drugs and bringing sixty to seventy per cent of the drugs under price control, however, do not augur well for the industry and if implemented could put the Indian drug industry. A look at the timeline presents a proper perspective both from historical and futuristic points of view.

1947: Product Patents

At the time of independence, the pharmaceutical industry in India was only about one hundred million in total sales. The size of the Indian pharma market is about ₹ 67,000-crore today. Product and process patents were in place even for pharmaceuticals in 1947. The industry was import-dependent with very little domestic production. Multinationals dominated the domestic market.

1970: Process-Only Patents

The 1970 amendment of the Patents Act from product and process patents to process-only patents has been a key driver for the growth of the drug industry in India. The Indian alchemists reverse-engineered virtually every new drug discovered in the world, marketed most of them in domestic market and exported to countries where there were no product patents. The industry grew dramatically particularly in the manufacture of APIs and drug intermediates. The domestic formulators to strengthened their position in the market place and improved their share of the domestic market significantly. The leading domestic companies started drawing their plans to enter the overseas markets in a phased manner in the early 90s.

1995: Product Patents

India became a signatory to GATT in 1995 and became TRIPS-compliant by 2005 after the ten-year transition period. Product patents, besides process-patents have come into place. Multinationals started showing greater interest in the large and rapidly growing Indian pharmaceutical market. The Indian drug manufacturers’ lobby was apprehensive of the product patent regime. Some of the more progressive Indian drug majors embraced the changes, showed strategic foresight and made remarkable progress. They accelerated the process of internationalizing their businesses and made significant headway. As a result India moved up to the thirteenth position by value and third position by volume in the world pharmaceutical market.

2012: What is At Stake?

What are the likely consequences, repercussions and implications of the proposed ban on brand names for drugs, and such a broad coverage of drugs under price control? It could stop the progress that the Indian drug firms are making in international markets in their tracks. The R&D effort would be severely constrained. The industry would lead its competitive edge as it would find it difficult to keep itself ahead technologically. Consider for a moment the progress that the Indian drug industry has made in the world pharma markets. Indian drug companies currently export their generic formulations and APIs to over 200 countries. They have built world class facilities to manufacture their products. In the world’s largest generics market, the US, drug master files (DMFs) from India account for over 30 per cent of the total filings. Three Indian drug companies were among the top generic companies in the US in 2011 for growth. All this is at stake considering these draconian proposals. Furthermore, TRIPS-compliance status could be at risk. It could be perceived as stalling the reforms process and market access for Indian firms could become more difficult. Mushrooming of poor quality vanilla generics would flood the market as they did in Pakistan when it implemented, and immediately corrected its decision by reversing it. Shouldn’t we learn from their experience? Are we going back to the brink?

Knee-jerk Reaction?

The parliamentary standing committee in its recent scathing report had also expressed strong objection to the practice of issuing licenses on brand names, reported The Times of India of today. The Union health ministry’s order in the wake of this to states to stop issuing licenses for the manufacture or sale of drugs on the basis of their brand name appears more like a reflex reaction without any strategic foresight.

While it is essential to achieve universal drug coverage for the entire population by making medicines affordable is banning the brand names a solution? The forty per cent spurt during the ten-year period of 1996-2006 of drugs – how does it compare with the overall inflation and the increases in the prices of essential commodities?

What is NPPA doing if the drug prices are escalating unreasonably? Are they not supposed to control and regulate the prices? If it is a governance issue, how can banning the brand names for drugs solve the problems of price increase. What about the prices of input costs? Are they steady or have been increasing over the years?

Furthermore, has the government, which is trying to put the reform process back on trail considered the implications and repercussions in the face of globalized world economic order of such a drastic move? Are the concerned departments in the governments aware that the Delhi High Court had quashed such a move to ban the brand name drugs in the early 1980’s?

Every which way you look at It, it looks more like a knee-jerk reaction!

Ban on Brand Names For Drugs – Boon or Bane?

Today’s news in the Times of India that Health ministry pushes for end to sale of branded drugs is indeed shocking. History repeats itself. This is not the first time that the government of India contemplated this so-called ban on brand-name drugs. Thirty-two years ago, in 1980 the government to abolish the brand names for all single-ingredient drugs. They are including all FDCs (Fixed-Dose-Combinations) also in the ban this time around. The Pharmaceutical Industry, mainly led by the multi-national companies contested this decision by filing a petition in the Delhi High Court, which had quashed the ban as unconstitutional.

Consider the speech delivered by Mr. S.V. Pillai at the Annual General Meeting of Pfizer India Limited in 1981, on the brand name issue gives useful insights, a clear picture making a strong case for brand names in the pharmaceutical industry. Brand names usually have no similarity in spelling or pronunciation.

  1. The use of brand name is simpler: Di-hydro-ergotamine methane sulphonate is the generic name of the drug marketed under the brand name Dihydergot. Another jawbreaking, tongue-twisting, generic name is xylometazoline hydrochloride. It is available under the brand name Otrivin.
  2. Confusion exists between generic names: Quinidine sulphate is the generic name of a cardiac drug. It can easily be confused with the anti-malarial quinine sulphate.
  3. Efficiency: Generic equivalence is not the same as therapeutic equivalence. PIllai said, “Although such a product (generic equivalent) may contain the basic chemicals needed to fight your illness, evidence shows that often there is a real question about the potency of this ingredient, the way it has been combined with other substances, whether it dissolves satisfactorily and whether it is stable etc.,” Its uses will determine how much of the drug is absorbed and how rapidly it is assimilated. Other important considerations are the side effects of the drug and tolerance by the patients.
  4. Reputation of the company, Quality Assurance: When a company sells a product under a brand name, it is staking its reputation on the brand. This is a less expensive way of ensuring quality than administrative controls, according to a communist sociologist from Poland. Before a brand is cleared for marketing there are extensive clinical trials undertaken by the company concerned.The better companies maintain a ‘post-launch’ reporting system; a panel of doctors keeps them informed about the brand’s performance when it is administered to patients. Any possible adverse effects can be detected in this manner. In a generic system this safeguard is not available at all.
  5. Margins rather than quality: The doctor prescribes the drug by generic name and the patient takes it to the drug store. The dealer is likely to sell him the product from which he earns the highest trade discount. The doctors’ prescription freedom and right are taken away. The dealer plays a far more important role in the sense that it is he who ‘chooses’ finally (some may say the doctor can insist on the company when he prescribes). The competition will no longer be on the basis of therapeutic efficiency but on the basis of the margins one can provide to the middle man. Quality is bound to suffer and the loss will b the consumers’. At the same time, the consumer is not going to enjoy the price benefit either. In India price controls apply not only to branded drugs but also to generics. And the cost of promotion will not be reduced. Only the emphasis is shifted to the middle man from the doctor. So any assumption that the abolition of brand names will bring down the prices is unfounded.
  6. Disincentives to R&D: The denial of the trademark protection to a drug will destroy the incentive for drug houses to develop new medicines. The cost of developing a new drug is very high and runs into millions of rupees. The discovery of an active ingredient is not enough. This will have to be followed up by toxicity trials; experiments on animals are followed by expensive and time-consuming clinical trials. What is that the company is left with, at the end of all this effort and expense, if it cannot have the brand system to protect its interests? Very few new drugs have been developed in India; the introduction in India of the new drugs discovered abroad has slowed down after the government adopted a policy of disincentives.
  7. Trader benefits: Whom does the abolition of brand name benefit? Not the doctor. Since generic equivalence is not the same as therapeutic equivalence, it prevents him from giving his patients the best professional advice he can. It is also inconvenient. The Sainsbury Committee in the U.K. had proposed a ban on brand names for new drugs, but the Labor government rejected the proposal. Soviet Russia, which in the beginning used only generic names for drugs, has since the mid-1960’s encouraged pharmaceutical companies to identify their products. In export markets Soviet Russia is offering products under brand names and it buys drugs from other countries including India by brand name. In other countries like Bulgaria, Poland, Hungary and Yugoslavia where the pharmaceutical industry has developed fast, brand names are extensively used for drugs. The only country, which made a bold experiment abolishing brand names for drugs is Pakistan. The generic scheme introduced in 1972 was a disastrous failure. It encouraged mushroom growth of drug units and the market was flooded with substandard, spurious medicines, which were not cheaper than branded drugs. The scheme was therefore, scrapped under the 1976 Drugs Act.

Need we say more in defense of brand names for drugs?

Ban on Branded Drugs – Retrograde? Myopic?

The news item in The Times of India  today regarding a proposed ban on branded drugs forces one to think of how retrograde and myopic can one be in finding a solution to an important problem such as drug price escalation? One might ask, is it only drug prices that are escalating? It is reported that during the ten-year period, between 1996 and 2006 drug prices have gone up by about 40 per cent. What about other essential commodities?

There is nothing new in this decision of banning or abolishing brand names for the drugs by the government of India. Thirty-two years ago, in 1980 the government of India took a decision to abolish the brand names for all single ingredient drugs. All the drugs that were to be introduced from 1980 had to be marketed under the generic name. Cimetidine, metoprolol, terbutaline, and nifedipine were some of the important drugs that were affected  as a result of this. These drugs were the products of research by different multinational companies. Although some companies introduced these drugs under their generic names, the prices did not come down as expected.

The Economic Times reported that some of the large pharmaceutical companies (multinationals mainly) have filed a petition in the Delhi High Court, which gave the following judgement calling the move as unconstitutional:

  1. The banning of the issue of trade names besides being violative of provisions of the Trade Marks Act, as noticed by us earlier is also violative of provisions of Article 19 (i) (g) of the constitution. This provision guarantees to every citizen the right to practice any profession or to carry on any occupation, trade or business…
  2. Not allowing the brand names usage interferes with the right to carry on trade or business…

Isn’t the government aware of the fact that the denial of a trademark protection is a major disincentive to research and development? What are the likely consequences? No new drug worth its name has been developed in India till date and as a result of this policy of banning brand names and trademarks comes into effect no new drug will be developed in future. So what…?

How Well Do You Know Your Brand?

How well do you know your brand? Do you know it well enough to understand its personality, character and values? Its capabilities and vulnerabilities? I am not referring to the data sheet or fact sheet of the product which gives all the technical information such as molecular structure, composition, dosage form, mode of action, side-effect profile and the like. They are all important but not enough to understand the brand in totality. That is all valid and valuable information but not insight. What you need is insight into your brand. To gain that you have to know your brand inside out. You have to eat with your brand, play with your brand, live with your brand and sleep with your brand to understand it and tell its story to the target audience in a compelling manner. James Webb Young, the legendary ad man described what a senior writer advised Guy de Maupassant, one of the world’s most famous short story writers on how to write a story when he was new to the craft.

The senior writer told him,’ Go out in the streets of Paris and pick out a cab driver. He will look to you very much like every other cab driver. But study him until you can describe him so that he is seen in your description to be an individual, different from every other cab driver in the world.’  That is gaining intimate knowledge.

Gaining intimate knowledge about our products and consumers is not easy. It is very difficult. Most of us stop too soon in the process  of gaining it. We don’t dig deep enough. we don’t go far enough. If there are no striking differences on the surface we assume that there are no differences. But if we dive deep enough, go far enough, we nearly always find that between every product and some consumers there is an individuality of relationship, which may lead to a unique idea.

Now, decide whether you know your brand well enough to tell your target audience a story that is distinctly different from the rest of the crowd in the category. If not, dig deep enough to strike the oil of distinctive edge and go far enough to find that great, unique idea!