November 29, 2006

The bloated sales force disease

Only a day after Boeing was lauded for its new restrained approach to growth, the world’s largest drug maker, Pfizer, announced similar steps. In Pfizer’s case, the first step was a 20% cut in the size of its sales force.

Pfizer, like many pharmaceutical companies, sharply increased the size of its sales force and marketing budget to try to compensate for its labs inability to discover sufficient new drugs.

This misguided “put-more-feet-on-the-ground” strategy has been followed by other drug makers (and other industries such as banking) that have become caught in the bigness rat race. It papers over the real problems, providing only temporary relief along with a hefty dose of high costs. Worse of all it shifts the focus of the business leaders to sales and marketing issues, at the expense of paying attention to improving the flow of new and better drugs through the R&D pipeline.


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