Gilead Systems wins the Triple Crown – simultaneously improving revenues, reducing costs and enhancing service.
As Business Week puts it in the prelude to this years review of the top 50 performers in Standard and Poors 500 stock index “for many years pharmaceutical companies viewed the development of HIV treatments as a necessary – but unprofitable – public service. There was some logic to that view, given that the majority of victims lived in developing nations and were unable to pay what drug makers could earn from selling other products. But Gilead Systems had a different perspective"
Since 2004 Gilead have tripled profits to $1.6 billion by directly focusing their efforts on the Successful Customer Outcome, and in this context it is surviving beyond HIV infection. Previously treatment involved a complex cocktail of many drugs, timings and expense involving dozens of throughout the day. Gileads ‘outside-in’ vision allowed them to create a solution crafted around the customer, the resulting drug, Altripla, costs $1300 a month and is taken at bedtime. The innovative drug releases different medicines over several hours and in doing so makes the customers life simpler, easier and more successful. Production cycles have been slashed, volumes increased nine fold and costs reduced by a factor of ten.
Gilead’s outside-in thinking and practice, led by CEO John Martin, says Business Week “is a hallmark of 
the companies in this years rankings” of top performers. “It’s this kind of management vision and moxie that could spell the difference between the companies that not only survive, but thrive, and those that are carried away in the economic undertow. These are companies that, for all their past successes, are not afraid to alter their business models at the first signs of weakness.”
In industries as methodical as pharma (twelve years to develop a product is quite simply a dogs life) there is enormous potential to create new and more customer oriented ways of working, as Gilead prove consistently.
What holds us back? The inertia of the 20th century inside-out thinking is precisely what. That place where the customer revolves around the organization with functional specialism and corporate paralysis. That place of politics, turf wars and fiefdoms (hey who has time for the customer?) and ultimately stagnation and decay. That place where we designed tools and systems (forgive me SAP and oracle) that have fossilized and marginalized our processes.
The new way, outside-in thinking and practice liberates our people and creates the vibrant energized companies that now lead the pack. Best Buy (Retail technology), Virgin (Brand kings), FedEx Kinko (printers extraordinaire), Emirates (new thinking in the sky) to name a few represent new business models oriented around the customer.
Gilead Systems have now created a new challenge for all sectors – what do you do when your closest competitor starts to offer your core product, easier, simple and complete AND for next to nothing – even free?
Peter Fingar, one of my mentors who inspired Bennu, described this challenge in ‘Extreme Competition’. If you would like a copy let us know. I will be reviewing the shape of the world to be in my conference keynotes this year – please join me of you can! I am in the UK next week at the 9th Annual Process Excellence conference at the QE2 Centre in London – see http://www.iqpcevents.com/ShowEvent.aspx?id=41558&details=54592
Food for thought?
Has your company linked everything it does with Successful Customer Outcomes?
Are you truly aligned through your processes, people, systems and strategy?
Do you focus 'Outside-In' or inside-out?
References:
Review Business Weeks 2008 Top 50 Performers (as measured by Standard and Poors)
http://bwnt.businessweek.com/interactive_reports/bw50_2008/
See the associated Special report
http://www.businessweek.com/magazine/content/08_14/b4078051184585.htm?chan=magazine+channel_special+report
Customer Expectation Management
(the book that kick started Outside-in process and performance)
http://www.amazon.com/exec/obidos/ASIN/092965207X/httpwwwstevet-20
Extreme Competition – Peter Fingar
http://www.amazon.com/Extreme-Competition-Innovation-Business-Reformation/dp/092965238X//httpwwwstevet-20
9th Annual Process Excellence conference at the QE2 Centre in London
Going From Process Excellence To Business Excellence
http://www.iqpcevents.com/ShowEvent.aspx?id=41558&details=54592
Creating the direct linkages with these performance objectives is now a major strategic goal in order to better align people, processes, systems and strategy to achieve successful customer outcomes.
- Evolving and building Six Sigma & Lean approaches to Outside-In thinking
- Building the framework to support excellence
- Creating the linkage between process change and corporate performance improvement
- Leading your people beyond techniques and tools into successful customer outcomes
- Delivering a comprehensive and sustainable strategic approach to process and performance transformation
http://www.iqpcevents.com/ShowEvent.aspx?id=41558&details=54592
References:
Review Business Weeks 2008 Top 50 Performers (as measured by Standard and Poors)
http://bwnt.businessweek.com/interactive_reports/bw50_2008/
See the associated Special report http://www.businessweek.com/magazine/content/08_14/b4078051184585.htm?chan=magazine+channel_special+report
Customer Expectation Management
(the book that kick started Outside-in process and performance)
http://www.amazon.com/exec/obidos/ASIN/092965207X/httpwwwstevet-20
Extreme Competition – Peter Fingar
http://www.amazon.com/Extreme-Competition-Innovation-Business-Reformation/dp/092965238X//httpwwwstevet-20
9th Annual Process Excellence conference at the QE2 Centre in London
Going From Process Excellence To Business Excellence
http://www.iqpcevents.com/ShowEvent.aspx?id=41558&details=54592
Creating the direct linkages with these performance objectives is now a major strategic goal in order to better align people, processes, systems and strategy to achieve successful customer outcomes.
- Evolving and building Six Sigma & Lean approaches to Outside-In thinking
- Building the framework to support excellence
- Creating the linkage between process change and corporate performance improvement
- Leading your people beyond techniques and tools into successful customer outcomes
- Delivering a comprehensive and sustainable strategic approach to process and performance transformation
http://www.iqpcevents.com/ShowEvent.aspx?id=41558&details=54592
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About the Author
Steve Towers, Senior Vice President of BP Group (www.bpgroup.org) and founder of Towers Associates, is an expert on process and performance transformation.
Steve founded the first community focused on business process management in 1992.
Steve has bases in Europe (UK), Texas and Colorado.
Meet Steve at http://www.towersassociates.com/SBT_services.html#upcoming
