Why do Senior Managers Keep Repeating the Same Mistakes? Part III – Asrar Qureshi’s Blog Post #946

Why do Senior Managers Keep Repeating the Same Mistakes? Part III – Asrar Qureshi’s Blog Post #946

Dear Colleagues! This is Asrar Qureshi’s Blog Post #946 for Pharma Veterans. Pharma Veterans Blogs are published by Asrar Qureshi on its dedicated site https://pharmaveterans.com. Please email to aq.pharmaveterans@gmail.com for publishing your contributions here.

Credit: Alena Darmel

Credit: Alena Darmel

Credit: Karolina Grabowska

Credit: Tima Miroshnichenko

Continued from Previous ……

The team assigned to KK was doing well in sales. However, their portfolio consisted of mostly older products, few of which were cash cows also. The older products were entrenched in their market segments but grew quite slowly. KK thought it was a great opportunity that he had established products; he attributed their slow growth to lack of focus and targeted work.

KK asked his marketing team to extract IQVIA data of the marketed products for the last three years, and he asked them to do it ASAP. It took some time anyway, but finally he had the requisite data on his table. KK dived into it and analyzed it in several ways. To his disappointment, he found that the market for these products was growing slowly on an overall basis. The volumes were bigger, but percentage growth and unit growth were mostly single digit, and that also 5-6%. He was not happy. 

He again called in his marketing team and asked them to prepare new campaigns for these products. They complied and made some high energy campaigns, including but not limited to, family gatherings of doctors in all major cities, a series of giveaways, presentations in wards followed by refreshments etc. The estimated cost of plan ran over fifty million rupees, which KK calculated was barely 6% of the products revenue. KK was very excited and named the program as ‘Energizing the Brands’ and requested time from his boss. At the appointed time, KK met the Director Marketing. They sat in the meeting room where KK made an impressive presentation of the plan, the DM listened intently but did not make any remark during the presentation. At the end of the presentation, he appreciated KK’s and his team’s effort for data analysis and for coming up with energetic ideas. Then he said he had a few questions. 

Question #1 – “Why do you think the market growth has been slow for these products, though their volumes show their popularity/” KK fumbled that probably no one paid enough attention because the products were selling anyway. He also opined that maybe the entire team lived in comfort zone and didn’t want to do any extra effort. The DM smiled dryly and said these were opinions, not analytical conclusions. KK became quiet. The DM then explained, “These are conventional products which have become sort of over-the-counter products which the patients kept buying without prescription. The doctors had moved on to new products which they prescribed in routine. What you need to understand is that these products are neither promotion-dependent nor promotion-sensitive, so if you make huge promotion, it will have little impact. The company keeps these products because they bring guaranteed revenue, offset the production costs due to their sheer numbers, and remain corporate identity. The doctors may not prescribe these anymore, but they recognize the company from these, and this is a huge marketing advantage.” KK could only nod.

Question #2 – “What do you think are the profit margins in these products?” KK said he did not know yet as he had not checked. The DM replied, “Most conventional products, if not all, have low prices, and small margins. Their strength lies in the numbers they sell. Though 6% additional marketing expense may seem small to you, but it will bring the products into negative. You can understand that loss shall also multiply with numbers.”

Question #3 – “What is the basis of aggressive forecast? Is it market survey? Or IQVIA data?” KK replied that IQVIA data showed small growth and that market survey had not been done. “Exactly”, the DM said, “First of all, IQVIA data is very helpful, but in order to understand market dynamics, you need to survey the market, get feedback from team managers, and take opinion from selected few doctors. Basing everything simply on data can be detrimental.”

By now, KK was completely flat. His first ever plan had been demolished, and he had to cut a sorry figure in front of his boss. He rightly thought that he had left a very poor impression right in the beginning of his tenure there. 

KK came back to his office dejected, clear that the whole effort had been wasted. He did not want to share this information with his marketing whom he had required to work hard to design this plan. How could he tell them that the entire thing had been rejected, politely though, but still rejected. KK stayed alone in his office for quite a while, thinking how he could manage the damage, and what new ideas he could come up with. KK was an ambitious person, and not the one to accept defeat easily. He finally decided that the best way to mend his reputation would be to come up with more innovative ideas. He also thought that he would seek more details before finalizing and presenting any plan. Satisfied, he called a meeting with his marketing team, told them the plan had been greatly appreciated, and that its implementation had been deferred due to certain corporate reasons. He said that they would come up with new short-term, smart plans to energize the team and brands. The senior product manager suggested that they should include the zonal managers in the discussion as they had been working for long time. KK got offended, “What do they know about marketing? They only know sales and that also in the most conventional manner. We shall make plans and ask them to execute, which is what their job is.” Everyone went quiet.

The marketing team went back to their cabin, a bit uncomfortable. The senior product manager was not convinced with KK’s argument. He still believed they could get valuable information from zonal managers. He decided that he would talk to them on his own and gather information before proceeding further. He also decided to keep it hush hushed so that it did not become a conflict.

The SPM prepared a set of questions before calling the managers. He wanted the information to be precise and actionable. He knew that the managers might not have analysis, but they could provide live market information. His questions ran like this:

1. How long have you been handling these brands?

2. How many people are currently promoting these?

3. How many doctors are enlisted for promotion of these products?

4. How many calls are made for each product in a week/ month?

5. How many prescriptions are seen for these products?

6. Knowing that a certain business comes from over-the-counter sales, can you tell what portion comes from prescriptions and what comes from OTC?

7. Are the prescribers mostly old, senior doctors, or a mix of senior and young doctors?

8. How are the competitor products doing in their area?

9. What promotional activities competitors are doing?

10. Any suggestions to put more energy into these brands?

The SPM decided that he would make every effort to get the real, not official information.

We shall see what happens next in the next blogpost.

To be Concluded……

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