Tuesday, February 09, 2010

Green Ketchup for Novartis?

We recently commented on the challenges facing the large, Swiss based multinational pharmaceutical company Novartis.  From Business Week came an interview with the new CEO of Novartis, in which he revealed why he thinks he is especially qualified for the job:
Joe Jimenez says that more than 20 years selling Clorox (CLX) bleach and Heinz ketchup taught him to make decisions quickly. Now, as CEO of Novartis (NVS), Europe's second-largest drugmaker, he'll try to prove that speed can also make a difference in the pharmaceutical business.

Jimenez, an American with degrees from Stanford and the University of California at Berkeley, believes his consumer-products background will help. He started his career at Clorox, the world's largest maker of bleach, ran two divisions of ConAgra Foods (CAG), and oversaw H.J. Heinz' (HNZ) European operations. With consumer packaged goods, 'Decisions have to be made quickly because the market moves quickly,' he says. But pharmaceutical businesses have long development lead times, which 'tends to slow decision-making in areas where it doesn't need to.'

Jimenez oversaw the introduction of kid-friendly green ketchup when he was Heinz' North America chief executive,....
Further explanation of why supervising the selling of cleaning or food products would be good experience for the chief executive of a pharmaceutical company, which faces technical, regulatory, and clinical issues very different from the challenges of selling bleach or ketchup, was not forthcoming.

The reason for citing Jiminez's responsibility for green ketchup was more obscure.  According to the authoritative medical journal, Woman's Day magazine, Heinz's green ketchup was one of the "7 Biggest Food Product Duds," in the US, and was discontinued in 2006.

As we have discussed before, the current culture of US and global business includes the belief that someone trained in finance or marketing is the most suitable leader of every type of organization.  Such leadership has lead the US biggest automobile manufacturer into bankruptcy.  We have discussed numerous examples of leaders of health care organizations with no health background or experience who seem to be most expert at making sure their compensation is hugely larger than that of most of their employees.

We hope Novartis does not end up trying to sell the pharmaceutical equivalent of green ketchup. 

I say again, to really reform health care, we need to have leaders of health care organizations who actually understand health care and share its values.


InformaticsMD said...

But pharmaceutical businesses have long development lead times, which 'tends to slow decision-making in areas where it doesn't need to.

Which areas might that be, I wonder?

Anonymous said...

Remember - A salesman truly believes what they are saying at the time they are saying it. This person truly believes they are qualified for this job and will transmit that belief to the Board. We also have the mistaken belief that over coming adversity is a sign of personal strength.

In this case the Board needs to look at the basic qualifications of this person and fitness to complete the task. His failure will harm stockholders who are the true owners of the company. Speed is never an issue, making the right decision is.

Steve Lucas