Dec11

Now That’s a Vision

visionary_governanceIn our business, we often help our clients to develop and navigate their corporate vision. If done well, the vision of the company is aspirational, achievable, and distinctively ownable. Far too often when reading a company’s vision statement, you feel that you could simply replace Pharma Company A with Pharma Company B, and might at times even question their ability to achieve that vision. So it is with fascination and awe this holiday season that I reflect on one corporate leader’s amazing vision for his company and his unwavering commitment to delivering on that vision. In 1994, when Jeff Bezos founded Amazon, he articulated:

“Our vision is to be the earth’s most customer centric company; to build a place where people can come to find and discover anything they might want to buy online.”

He has clearly redefined online retailing, and Amazon is the world’s top Internet retailing company.  While there are arguably many out there who may not agree with me, I applaud the customer experience that Amazon has created, and I have often tested the theory of whether they truly have “anything” I might want to buy online and my “cart” has yet to be disappointed, even for the most obscure or uncommon searches. So this month as I cross off items on my holiday shopping list and avoid carrying a heavy coat and shopping bags around a crowded shopping mall with annoying people, I thank you, Jeff Bezos and Amazon, for having an aspirational, achievable and distinctively ownable vision.

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Jun18

How To Milk a Horse

milkIt’s not very often I find myself marveling at a brand’s attempt to “co-opt” an opportunity or marketing “tie-in” to generate awareness and grow their brand. But I’ve really got to give it to GSK and their brilliant tie-in to California Chrome and the Belmont Stakes.

They did not horse around and brilliantly seized the moment for their Breathe Right brand. June is prime allergy season, so for nasal sufferers and excessive snorers, it was a perfect time to raise brand awareness.

The Belmont Stakes, the annual thoroughbred race in New York, was expected to draw in a larger-than-normal crowd due to the media frenzy around California Chrome’s bid to win the Triple Crown. Stir in a little controversy over whether to allow the nasal strips that California Chrome wears, and you’ve got yourself a beautiful opportunity to jump in and make some noise.

adexample

Enter GSK. They signed on as an official sponsor of both the Belmont Stakes and California Chrome.  They launched a huge PR effort, including publicity shots of the horse’s owners posing with Breathe Right strips, a new TV ad “Bed Time Stakes” featuring a jockey getting a good night’s sleep thanks to his strips, a social media campaign with tons of online chatter, and distribution of 50,000 samples at the actual event.

GSK took advantage of the 3Ms—Media, Momentum and Multichannel—so frankly whether California Chrome won the Triple Crown or not, they turned up a winner. Seriously, how often would anyone be talking this much about nasal strips? That’s how to milk a horse.

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Oct23

OCHWW’s 2nd Annual Partnership Summit

analytics thumbnail imageMy team, the Marketing Analytics & Consulting team, recently had our 2nd Annual Partnership Summit at the Chocolate Factory on October 10th. The New York office was buzzing as internal teams from OCHWW, greater Ogilvy & Mather, and clients roamed the halls eating, drinking wine, listening to presentations and meeting with various vendors. It was a wonderful turnout of around 200 total people who all found their way to try and win the door prize of the day, a Google Chromebook. A great and successful event, but also got me thinking. We had 10 total outside vendor partners at our event, in our building, trying to “sell” to our clients and teams. We trust them to sell their services and also not say anything wrong that would deter a plan or strategy from happening.

We were 100% covered for the day as each one of the vendors that attended has an agreement and is an OCHWW-approved vendor, but how many times do we invite vendors to our building, our office, our conference room, or our desks to talk to us, our clients, and our teams without a partnership agreement? What are our expectations? How do we partner with them?

Vendor partnerships have a lot of similarities to dating. They often start out with high expectations and aspirations and a common vision, and can end up in screaming matches over money and ex’s! But there is a way to avoid many of the stresses of a vendor relationship break-up – always have a partnership agreement. Think of it like a pre-nup where you and your partners agree upfront about the reason for your relationship and what will happen if either of you disagree or decide the relationship should end.

Having a partnership agreement in place is essential from the very beginning. Don’t leave these matters to chance or ignore it just because there are no problems at a point in time. You never know what is around the corner.

More than any other reason to have a partnership agreement is liability. If there’s no written agreement outlining specific arrangements, all partners are legally equally responsible for decisions made on behalf of the business, and must share profits and cover losses equally.

While every partnership agreement will be different, depending on the nature of the business, there are certain issues they usually cover, including:

  • How much money each partner brings into the partnership
  • What the different roles and responsibilities of each are
  • How disagreements are solved
  • What is to happen if a partner wants out
  • What guarantees will departing partners be permitted to have

Make breaking up easier to do. While a partnership agreement won’t cover you against all eventualities, it will go a long way to saving you time and money in the case of a disagreement or split.

All vendor partnerships are different. Sometimes we’re all friends but still have a clear agreement put together upfront.  It’s worth spending the time and money.

Our Partnership Summit was successful in educating everyone who joined on different services that external partners provide. But without the peace of mind of a partner agreement, the event would have been very stressful.

 

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Feb7

How Communications Can Support Mergers and Acquisitions

Merger-and-AcquisitionWith mergers and acquisitions (M&A) in the pharmaceutical sector showing no signs of slowing down, there has been criticism of some deals in recent years. These acts of consolidation don’t always reap the fruits they set out to bear and, if not managed well, may even result in a stifling of innovation, reduction in R&D productivity and decreased value of the company.

In a recent study as part of an MBA project, a survey and interviews were conducted among a sample of biotechnology and pharmaceutical company employees with experience of M&A deals, to find out their thoughts about communications during the M&A process.

Deal-making in the pharmaceutical sector is seen as a means of growth and competitive advantage through, for example, access to new markets or geographies; growth in R&D pipelines; access to scientific expertise in a given therapy or technology area; access to sales and marketing expertise; complementary skills and company synergies. The last few years have seen big pharma facing thinning pipelines and patent expiries, and for some, M&A activity is a means of gaining additional assets, innovation and technologies.

M&A activity has swept the industry, leading to some large and high-profile deals.  Despite the urge to merge, studies show that failure rates for M&As in general are high. Reasons cited for failures include poor corporate governance, poor valuation of the acquired firm, and bad post-acquisition management, including poor communication with employees and mismanaged integration of staff and departments.

Survey findings

In the 70-person survey of pharma and biotech employees with experience of M&A, 92% of respondents said their company had previous experience of M&A within the organization, with 57% saying further M&A was planned within the next 12 months.

The main reasons given for the deals were: access to R&D or pipeline, company growth or defense, entry to new areas or markets, and entry to new product areas. Some 52% of respondents said there had been some restructuring or significant restructuring of their part of the business post-M&A.

In describing the cultures of the two organizations in the M&A, 59% of respondents said the cultures were different or totally different, with 88% of respondents saying they believed it is important to create a company with common values and behaviors for M&A success.

As shown in table 1, survey respondents felt that communication with staff was deemed important for a variety of outcomes, including productivity, staff satisfaction and shareholder value.

Table 1: Summary of survey responses to importance of communications for different outcomes

Extremely important Very important Somewhat important Neither important nor unimportant Somewhat unimportant Not at all important
Staff satisfaction 40%  40% 15% 1.9% 0  1.9%
Productivity 40% 40% 9.6% 3.8% 1.9% 3.8%
Shareholder value 43% 30% 19% 1.88% 0 5.7%
Reducing levels of uncertainty 26% 52% 13% 0 4.3% 4.3%
Setting your own expectations 8.7% 39% 26% 13% 4.3% 8.7%

Talking to staff is not always a priority when doing a deal. As one interviewee commented, “The main focus is the deal itself and the financial benefits, synergies and scale. Companies don’t always think about the broader implications beyond this, so insufficient attention is paid to the communications imperatives of creating a new entity.”

“Communicating with external stakeholders—especially shareholders—is prioritized in M&A. I have heard cases where employees first knew of a merger of their company by reading it in the business press.”

Some pharma mergers have seen clashes at different levels especially where the companies coming together have very different cultures and one or the other has to completely change. Communicating about the reasons for the deal can help to gain staff buy-in and support during the M&A process, despite the accompanying uncertainties of change. It can help employees to establish an identity with and a commitment to the new organization.

But creating a single, strong company culture is not the only option. Some companies have maintained the different cultures of their separate organizations to support innovation and productivity from each company.

In the survey, all of the interviewees agreed that in order to reduce the high levels of uncertainty and rumors that tend to develop among employees during M&A, internal communication is vital. They also agreed that communication with employees can support integration, improve staff productivity and help to achieve better M&A outcomes.

“Without employee communications, the water cooler conversations take over. Employees become disengaged, motivation falls and no work is done, driving business performance through the floor.”

“If you don’t communicate, it is mayhem,” said a former Communications Head of a large pharmaceutical company. “All other things being equal, without a planned internal communications program, the desired M&A outcomes will be much more difficult to achieve.”

The survey respondents said the most commonly used forms of communicating with staff were company-wide meetings, written communications such as emails and newsletters, and team and individual meetings.

Graph 1: Communications tools used during M&A

chart

All other things being equal, communicating with staff about the rationale for the deal, the next steps post-merger and what the company changes mean for staff can support the success of a deal.

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Sep18

Partnership…How It Works

Relationships between us and vendors have become even more important in recent days. Competition among vendors is a lot more aggressive than it was in the past, and suppliers have to work harder to get business and even harder to keep it.

Some of the success of our service is partly contingent upon the work of vendors which reflects back on our services. In essence, their success is your success. Well-selected, reliable vendors with proven records of high performance certainly can help you succeed with your projects, but you in turn must put effort into building a solid working relationship with your vendors, a relationship that should evolve beyond the simple services rendered and into a true business partnership. The ideal partnership for both parties is long-term—through good and poor economic trends—and is based on communication, trust, and information sharing.

Establish the Connection

Much like any other relationship, vendor relationships are built upon trust, respect, and communication. At the onset of any new vendor relationship, both parties must clearly articulate themselves to arrive at a mutual understanding of wants, needs, and end results. From the start, we should give vendors all pertinent information that relates to the project. Allowing the vendor to understand your and its goals—both internal and external—will provide insight into the specific project and possible future ones. While it is the vendor’s responsibility to become familiar with our needs and goals, we should reciprocate by understanding those of the vendor. It pays to know what else your vendor has in their arsenal.

Be a GOOD Client

Just as you want a “model” client, vendors also want model clients. Too often, we approach our vendors with a “do-what-we-tell-you” model, which can exclude vendors from all communications. Time and time again, vendors identify their most valuable clients as those who keep the lines of communication free and clear and provide them with timely information on decisions that will affect their services. In the best-case scenario, the vendor’s representative is involved in all discussions about the service that they are helping to produce. Vendors often can make a valuable contribution to the decision-making process when it involves their area of expertise.

Joining the ranks of the model clients on your vendor’s VIP list is not as difficult as you might think. Simple steps can build the relationship with your vendor, making it easier to help your association make the conference a success.

One of the more obvious, but often not as common as vendors would like, is the act of returning a representative’s phone calls and e-mails (better yet, not only returning them, but returning them sooner rather than later). It is understandable that being in an agency, your schedule is already swamped, but it is very frustrating to a vendor if they can’t get in touch with you for an answer or a “green light.” Delaying replies to pressing inquiries from your vendor will hinder planning and possibly have a negative effect on the campaign/project.

Another behavior that can put you on a vendor’s “A list” is giving the vendor some latitude to exercise his or her own judgment and experience in providing your services. After all, you hired the vendor to do a specific task, something in which they excel. Letting go of your anxiety and allowing vendors to “do their thing” requires trust: something that for some is hard to attain. Without trust, though, you and your vendors both will be treading water.

Trust

The selection of a vendor as a collaborator or an advocate is essentially a statement of trust. Considering that you’ve researched references, looked at work samples, and met with them several times before committing to a statement of work, you can assume with some confidence that the vendors we are working with are professionals, and the success of a campaign can be multiplied when your vendors are treated as trusted advisors who provide insight on a project based on their expertise. Trust a vendor’s advice and judgment on what they know best—their business.

Open communication with your vendor’s representative will lead to a dialogue, which leads to the building of a relationship that enables you to consult with your representative as a knowledgeable advisor. Vendors can rely on their previous experiences to guide your association in making informed decisions that will strengthen your meeting or the value of whatever you purchase. The positive effects of treating vendors with respect for their knowledge and skill will show in the work that they do for you. Like anyone else, their motivation for excellence is increased when they feel they are treated with respect, as equals, rather than subordinates.

Of course, trust and respect are earned. By the time you start actually working with your vendor, though, your trust in them and theirs in you should already be well established through your preliminary meetings and reviews of the vendor’s previous work. Vendors who have worked successfully with and earned the trust of our colleagues whom you respect are likely deserving of your trust as well. Smart executives look first to their colleagues for recommendations of successful vendors.

Supporting Your Vendors

When you and a vendor truly “click,” then your relationship should not end with the completion of the statement of work. If a vendor made your project a success, then maintain your ties to draw upon that person’s experience and expertise in the future. One way to support your vendor after a successful project or event is to tell your colleagues about it. Giving referrals is a great way to recognize the quality service provided by the vendor. Word of mouth referrals are often more beneficial to a vendor’s new business strategy than any other method of promotion. Think of yourself as a spokesperson for the vendor’s services. Because you can attest to the quality of service and work your vendors provide and you have direct experience in working with them, you are qualified to speak on the vendor’s behalf to their benefit.

Giving Thanks

Giving thanks and recognition should be an obvious component to any vendor relationship. Not only is it the professional and courteous thing to do, but it also shows your business partner that you appreciate the hard work that was put into making your meeting a success. When appropriate, a heartfelt thank-you letter, copied to the vendors’ manager, is a meaningful gesture of appreciation. This not only lets your contact know you appreciate the work they’ve done for you, but it also shows their supervisors the good work that is being done by their staff.

Another way to reach out to your top vendors is to recognize personal events in the business partner’s life. Send personalized notes or gifts to acknowledge new births, holidays, birthdays, or other momentous occasions. These expressions show that you value your representative as a person as well as a business partner.

Why It’s Worth the Bother

Building a vendor relationship may require some additional effort by you and your staff, but the potential benefits of the relationship far outweigh the extra time. When you have a great relationship with a vendor, they become an extension of your association’s team, and this can result in new opportunities, savings, and benefits for your association and members. As you work with vendors to plan your project or campaign, pay attention not only to the details of the event but also to the details of the vendor relationship. Vendor collaboration and planning will run that much more smoothly as a result.

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