Build Talent & Trust, Lead With Tenacity

As the world goes through its tumultuous cycles, startups are no longer all successful; the older multi-generational ones are not invincible anymore. It is now even more about the 3Ts: #Talent, #Tenacity and #Trust.

Talent

Every organisation needs to take a brutally honest view of its talent bench. Does it have the breadth and the depth it needs for the challenges and opportunities of tomorrow? This is where most leadership teams fail. The misplaced belief, that what worked thus far will remain the secret algorithm, is suicidal.

More than ignorance, it is often arrogance that fails leadership. Leaders low on talent mindset are conservative in defining their emergent talent needs and lazy to even secure it. They often hire and promote followers, not challengers. Short on their own brand pull, they don’t hire people better than themselves — in pedigree, experience or potential. Even if they deliver the demands of today, such leaders then must become the first warning signs for firms to address.

It is not just about hiring a fresh crop or weeding. Every talent, who secures the future, needs to be tended to. Annual increments and bonuses are no longer enough. Time to have meaningful conversations, understand their teams beyond tasks, emotionally blend with skip levels and in the process move from being a boss to a coach is what keeps great talent. Leaders cannot be so busy that these remain a low-order check box item. The risk to the enterprise can be deadly!

Talent must be spotted early. The best must be allowed to progress much faster, in a variety of roles and with different leaders. They must be put in the most value-impacting roles. They must be given visibility to the senior leadership. Talent has a capitalistic bias; socialism can destroy it.

Tenacity

Building teams and corporations today is even more a call for tenacity. Not every business model will click; not every top talent will deliver always. Not every growing firm will stay clear of its share of swamps and deserts. One of the big virtues of leadership in the VUCA reality of today is tenacity of purpose and effort.

It finally comes down to the culture that one creates for the institution. Contrary to myths, culture is not a static set of moral science principles. Culture flows from business imperatives and supports the organisation’s business landscape. Culture seems a soft fuzzy thing that can always be done by HR later. This is the mistake of most left-brained leadership teams. Just because it is difficult to quantify, they make the mistake of leaving it diffused. Hence, a small hiccup can bring the firm crashing badly.

Defining a firm’s belief system, ensuring all organisational sub-systems are aligned to ensure every stakeholder understands and behaves consistently is key to building organisational tenacity. The exercise is one of making choices. This must be done with due deliberation but reinforced substantively. Companies often drift along, and each person then interprets and resolves to behave as one chooses. This may be in good faith but it creates fissiparous tendencies within the system, sharpening fault lines and impacting organisational tenacity.

At the same time, it is important to step back and reflect whether an espoused culture and belief system has outlived its relevance. Even if it seems heretic, organisations must never atrophy to become a prisoner of its past when the future is so different. Cultures must get revisited, refined and, if needed, repudiated. The old order must give way to the new, irrespective of political sensitivities and emotional outpourings. This itself then becomes a strong cultural pillar of a corporation. It builds, protects and sustains, beyond personalities and business cycles.

Trust

Every business or institution survives and thrives when it secures and retains the trust of its various stakeholders. Does it deliver its promise as perceived by the different constituencies? Does it evolve its value proposition over time? Does it read changes in the environment to still deliver an experience of trust and goodwill?

Some corporations have invested in years of delivering a promise that makes them more trustworthy. Others may have been successful but still struggle to be trusted. In many ways, trust is a bigger sustainable success than profits. How do leadership teams ensure their firms do the right thing to enhance their Trust Quotient?

One of the principle jobs of leadership is to ensure trust in their outfits. They must communicate proactively to the various stakeholder groups. They must respond to questions, honestly allay misgivings and humbly admit errors of judgment. No one expects a leader to always have all the answers. Unfortunately, positional leaders struggle to express their vulnerability. To seek help and not seem all-knowing are commonplace leadership traps. This is a recipe for trust disruption one day.

Whether it is with internal teams or with external groups, great leaders of today ensure their circle of influence is strong and credible. In the world of social media, they have reinvented themselves to connect, communicate and clarify. There can be no power distance from anyone today. It is about influence, not command. It is about relevance, not experience. Those who understand this and work at it are better placed to create relationships of trust, not handcuffs of business might or hierarchical prowess.

The world seems more complex today. But the leadership mantras for survival and success do not need complex algorithms or obtuse models. Get your 3 Ts — Talent, Tenacity and Trust — right first. The tumult will pass and you will be stronger the morning after the storm.

-Prabir Jha

This article was published in the Times of India, 5 July 2017.

Compliance Is The Biggest Risk In Healthcare

The healthcare and pharmaceutical industry deals with perhaps the most precious asset in the world: human life. The risks it faces are consequently more sensitive than some other sectors.

Risk is an inherent part of the pharmaceutical and healthcare business, as these allied industries continue to take on old and ever-evolving threats. In the quest to effectively deal with increased operational complexities and market fluctuations, these companies are drawing up extensive risk mitigation strategies.

To discuss the risks facing these companies, how they impact business and the best practices to counter potential threats to business continuity, senior leaders from India’s pharma and healthcare industries came together for a discussion as part of the Forbes India Risk Management Series, held in Mumbai in association with HP. These leaders included Ranjana Pathak, global head – quality, Cipla; Jayant Dwivedy, chief operating officer, USV; Ashish Vohra, head of ethics and compliance, South Asia, GSK; Joy Chakraborty, chief operating officer, PD Hinduja Hospital; Nimish Thakkar, chairman and managing director, Zuvius Life Sciences; Vernon de Sa, director – medical affairs, clinical *compliance and governance at Saifee Hospital; and Kalpesh Jani, senior security advisor at HP.

Panellists were unanimous that for the pharma and healthcare sectors, the biggest challenge is that of compliance, adherence to procedures, meeting the expectations of regulators such as the state health department (for hospitals) and the US Food and Drug Administration (USFDA) for pharma companies exporting to the US.

Of late, many Indian pharma companies have been impacted by regulatory action that have called their manufacturing standards in India to question. According to Dwivedy, the reasons for such moves on the part of the USFDA were due to a change in mindset towards the way reviews are conducted by the regulator.

Around 40-50 percent of generic drugs supplied to the US come from India at present, says Pathak. Previously, since the volume of drugs supplied from India wasn’t so high, the regulator didn’t look at the domestic manufacturing sector as intently before. But after a few highly publicised incidents of Indian pharma companies having concealed information from the regulators and investors came to light, the scrutiny was stepped up.

The biggest challenge is that of compliance, adherence to procedures, meeting the expectations of regulators such as the state health department (for hospitals) and the US Food and Drug Administration (USFDA) for pharma companies exporting to the US.

In the case of hospitals, which discharge the sensitive responsibility of caring for human lives, the biggest challenge comes in the face of patients and relatives questioning the appropriate cost of treatment, as well as adhering to government mandates of treating a certain quantum of patients from economically weaker sections at a subsidised cost. This poses a huge financial burden on hospitals, says de Sa. Chakraborty added that often it was difficult for the hospitals to ascertain whether a certain beneficiary of subsidised treatment was bonafide or not.

In the past six to eight months, Indian healthcare has been questioned and has encountered huge challenges of the kind not seen for the past 20 years, Chakraborty said. People are questioning treatment costs and clinical ethics. Consequently, there is a need for hospitals to adapt to the new environment and deal with these challenges.

Chakraborty elaborated that the Hinduja Hospital has taken a conscious call of not compromising on its bed charges to attract more patients; and this has allowed them to sustain without earning high margins on medical equipment and drugs needed for treatment.

Pharma companies catering to the Indian market have also come under the ambit of- Drug Price Control Orders issued by the government to keep the prices of essential medicines in check and make it affordable for the common man. Vohra of GSK feels that while the intent of the government is fair, slashing drug prices isn’t the only way to ensure healthcare inclusion. You need to create access to medicines at realistic prices for patients and that can be done by partnering with industry and creating avenues such as social better coverage of medical insurance, he said.

What if there is an adverse observation regarding any particular pharmaceutical company and the US FDA raises a red flag? If doctors do get any information about the quality of the drug or side effects pertaining to that particular drug, they always do a check of the company, the antecedents and then inform the FDA, following which the company can be blacklisted.

While compliance – of processes and data – is definitely a big area for pharma and healthcare companies, they are also acutely conscious that such compliance comes at a cost. While there are technology solutions to help these organisations adhere to the prescribed norms, it costs a lot of money. But most companies are willing to incur the necessary expenditure to remain on the right path, without risking reputational damage. “On quality, we do not have any compromises, a single complaint can hit our business badly for three-four years,” says Thakker of Zuvius Life Sciences. “We make cut back on marketing and promotional expenditure if required, but never on budgets to ensure quality.”

In a world where businesses are going increasingly digital, a serious challenge facing companies across the board is also that of cybersecurity – protecting the integrity of data and a company’s intellectual property. Jani of HP was of the view that the assistance of an expert technology companies needs to be solicited to implemented robust data protection mechanisms at the organisation. Even something like a printer, which is used to print our sensitive information and is connected to a larger IT network is susceptible to getting hacked and can be a source of data leak. But this can be avoided with timely intervention, Jani said.

This article originally appeared in Forbes India.

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Maharashtra Govt Ties Up With Tata Hospital For Palliative Care

The state government has rekindled efforts to create a palliative care system, tying up with the Tata Memorial Hospital (TMH) to train at least 40 doctors and nurses over the next two months. From eight districts where the programme currently exists, mostly on paper, the government plans to expand it to 17 districts this year.

The palliative care programme was launched in 2013 to not only provide symptomatic pain management to terminally ill patients, but also to counsel families about end-of-life-care. The idea is to ease the suffering of terminally ill patients when no further treatment is possible.

The programme has been hampered by lack of trained staff, high number of vacancies and poor funding.

In 2013-14 during its launch, the state government presented a budget of Rs 6.7 crore, while in 2014-15, a reformed proposal of Rs 4.8 crore was presented. Both budgets were shot down by the National Health Mission (NHM). Until 2016, of eight medical officer posts, four remained vacant. Of 32 posts for nurses, seven were vacant and, from among eight posts for counsellors, 50 per cent remained vacant.

A senior palliative care expert from TMH said while they routinely trained contractual staff on palliative care, several quit owing to unpaid salaries, forcing fresh training in the eight districts: Amravati, Satara, Washim, Wardha, Gadchiroli, Bhandara, Chandrapur and Nandurbar.

The absence of trained staff has hit the enrollment and follow-up procedures for patients. In Igatpuri and Jawhar areas, Tata Hospital noticed lack of follow-up due to lack of staff. The new batch of trained doctors and multi-task workers will now cater to terminally ill patients suffering from cancer, tuberculosis and ailments such as Parkinson’s and neurodegenerative disorders. “We will conduct a six-week training programme for them before they are posted,” said Dr Mary Muckaden, professor at Tata Hospital’s palliative care department.

The public health department said there are renewed efforts to strengthen palliative care support across the state. The government will also tie up with pharmaceutical company Cipla along with Tata Hospital to train doctors and nurses.

Government officials are, however, awaiting the NHM’s nod on the proposed budget for 2018-19, Rs 3.6 crore.

India ranks as low as 67 amongst 80 countries in Quality of Death Index survey commissioned by Lien Foundation and conducted by The Economist in 2015. In 2010, a similar survey by them put India last in the list.

The TMH, for instance, receives 70,000 cancer patients every year. With high mortality, as many as 5,000 enroll for the palliative care facility in the hospital. With a districtwise palliative programme, such patients can experience end-of-life-care support at their home in peace.

This article originally appeared on Indian Express

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Healthy Prognosis

Stocks of Indian pharmaceutical companies have been in the doldrums over the last few years, plagued by slowdown in growth from the key markets. Companies with focus on the US market have been hit really hard due to increasing regulatory hurdles, coupled with structural headwinds in the US.

While the near-term outlook for US-focused companies seem gloomy, companies that have a strong domestic presence, with a focus on high-margin and complex generics are likely to do well in the future. Cipla is one such company with a strong domestic presence, a growing US pipeline, traction in Europe and emerging market businesses. It holds a healthy position in the respiratory and oncology segments.

Investors with a two- to three-year time horizon can consider buying the stock. The share price is down 17 per cent from its November 2017 highs, making it an attractive option from a valuation perspective.

At the current price of ^545, the stock trades at about 17 times its estimated 2019-20 earnings, compared to 15-plus times that peers such as Lupin and Dr Reddy’s Labs enjoy. The premium valuation of Cipla is justified, given its superior earnings growth and improvement in the outlook for the US business, given that these can provide a leg-up to long-term revenue and earnings prospects. Cipla’s valuations are cheaper than those of Sun Pharma though.

Strong India business
Cipla is the third-largest player in India and this region contributes about 48 per cent to the company’s revenue (as of December 2017). The domestic revenue grew by 11.5 per cent CAGR in the last five years to ^5,521 crore in FY17. The acute, chronic and sub-chronic revenues from the domestic business stood at 47, 41 and 12 per cent, respectively.

The company retains its No.l position in respiratory, urology and paediatrics, and now focuses on oncology and dermatology segments. With the gamut of product offerings, Cipla has consistently introduced products in these segments.

Cipla witnessed significant traction in recent quarters and registered better performance in the domestic market, driven by both prescription and generics businesses. The National Health Protection Scheme is likely to aid volume expansion in the domestic market.

Growing US pipeline
Cipla’s US business contributes around 17 per cent to the total revenue as of December 2017. Though a late entrant to the US market, Cipla has gained considerable market shares in several drugs. Revenue from the US grew by 52 per cent CAGR in FY 2014-17 to ^2,625 crore. Cipla’s current US product portfolio includes 48 drugs, of which it has a leadership position in 13 and among the top three in 31. However, growth rates have moderated in recent quarters in the US due to price erosion and competition in key drugs.

The recently launched limited competition generics Pulmi-cort (controls wheezing) and Da-cogen (treating cancer)” offset the loss during the December quarter.

Cipla has a strong pipeline of pending abbreviated new drug applications (ANDA) for the next 12-18 months with generics such as Albuterol (bronchodilator), Advair (bronchodilator with steroid) and breast cancer treatment Abraxane set to be launched.

Of the 244 ANDAs filed, there are 67 product pending approval, of which 16 hold Para IV Filings opportunity, primarily in respiratory, oncology and dermatology, while 15 are limited competition products. The company’s respiratory and specialty pipeline are considered as longterm growth opportunities.

Cipla has been complying with regulatory norms quite well. The outcome of eight 483 observations in the recent inspection in its Goa unit by the US regulator were product-specific and procedural in nature. These are unlikely to escalate to a warning letter.

Cipla is the also the fourth largest player in the South African market, which contributes around 22 per cent to the total revenue. The revenue grew by 29 per cent CAGR over FY 2012-17 to ^1,825 crore. The company enjoys leadership positions in oncology, respiratory and CNS therapeutic

Financials
For the nine month ended December 2017, the consolidated revenue (?ii, 255 crore) and net profit (^1,263 crore) grew by 4 and 15 per cent respectively. Operating profit margin stood at 23 per cent improved by 275 bps due to better operating efficiencies.

This article originally appeared in The Hindu Business Line.

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Rethinking The Phone-life Balance

On the Metro, in a bar or mid-conversation with your spouse, do you sneak a peek at your phone? And by the time you look up, 15 minutes have passed and the conversation has drifted as the other party is also tapping away furiously. Scrolling your phone screen even as you read this? Welcome to the club.

A recent Motorola study on phone-life balance says 65% of Indians in the 16-65 age group feel the phone is their best friend while 47% would much rather spend time with the phone than with the one they love. Around 57% feel compelled to perpetually check phones, and 77% are so emotionally dependent that they panic if they think they have lost their smartphone. The study was conducted among 4,418 smartphone users aged 16-65 in the US, Brazil, France and India.

There’s no counter to the argument that the mobile phone has become an extension of the self. Ironically it is also true that browsing, chatting, social media networking and 24×7 alerts thrown up by smartphones are cutting into the work and me-time of professionals and businessmen alike.

Saugata Gupta, MD & CEO of Marico, never switches off his mobile phone. For the past 10 years or so, he has never been out of office, so to speak. He takes two or three short breaks during the year with his family and on these holidays, he gets up an hour earlier so he can respond to a few important mails and make some calls. The rest of the day, he checks his mails only once an hour.

However, a few business leaders feel a holiday is synonymous with going on a digital detox. In my view, a mobile detox is more important than heading to a health spa, says Harsh Goenka, chairman of RPG Enterprises who makes it a point to check his phone only once or twice a day on holidays. At work, he says, he keeps his phone on silent mode in his pocket during meetings. At night, the phone is strictly outside the bedroom.

Prabir Jha, president and global chief people officer of Cipla, is digitally unavailable once he leaves office. “My post-office hours are switch off times. Music, humour, conversations, reading, cooking…anything but office! And my weekend siestas are my turbochargers,” says Jha.

Some organisations too are recognising the disruptive effect technology has had on personal lives. Many line managers now do not insist on immediate responses to emails during weekends and holidays. We recognise that different people have different time preferences for reflections and emails in a globalised work eco-system. However, we (at Cipla) do not expect an immediate response. That takes a lot of the pressure off, says Jha.

Jha has managed what most Indians don’t phone-life balance. Dr Nancy Etcoff, who teaches psychiatry at Harvard Medical School, which partnered in the Motorala study, says it’s time to honestly assess how smartphones are affecting our lives. Smartphone use can become misuse when it stops enhancing lives and instead diverts our focus from the people and the activities we value, she says. It is one step from there, she adds, for misuse to become an addiction.

Etcoff says the smartphone industry itself should work towards weaning off users. Time, Well Spent, a non-profit initiative of design ethicist Tristan Harris, is a baby step in this direction. Harris, who quit Google to work full-time on reforming the “attention economy”, has founded the Center for Humane Technology and is currently working on the ethical persuasion of technology companies to create less addictive apps and help steer users away from screens. Even Mark Zuckerberg welcomed the idea and said time well spent would be a design goal for Facebook. Technology, he says, should be on our team to help us live, feel, think and act freely”.

And that includes the freedom not to immediately look this up on your phone.

This article originally appeared in The Times Of India.

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