Fuld’s Competitive Musings

Whew! This year is about to end and what a relief for many of us. Busy, hectic, fractured are just some of the adjectives I will consider when looking back over my shoulder at 2009.  Next year promises to evoke a different set of adjectives, such as confounded and ill-prepared. I say this because we are about to complete a number of surveys that indicate 2010 will bring with it a number of specific short-term and long-term competitive warning flags:

Warning flag #1 - China continues to confound Western companies:  We just completed a survey on competitive challenges Western companies encounter when working in China. We conducted this survey in conjunction Dr. Denis Simon, Professor of International Affairs at Penn State University and the China Institute. Fifty-four companies participated, many with over 16 years of experience in the China market.  Among their competitive concerns are:
- The business environment remains uneven and extremely vexing
- Our chief competition in China today may be other multi-nationals but tomorrow are likely to be domestic Chinese companies about which we know terribly little
- Government policy so dominates competitive conditions, we feel we just do not have a handle on which way the “wind is going to blow” with respect to new regulations or changing competitive rulings
- There is a lack of informational transparency with much market data either not available or at times not accurate
Warning flag #2 - We are inadequately prepared for the next healthcare marketplace: Under the guidance of Wayne Rosenkrans, Fuld Vice President and Chairman of the Personalized Medicine Coalition in Washington as well as a Fellow at MIT’s Center for Biomedical Innovation, we are polling senior healthcare executives in the United States about their preparedness for the 2015 healthcare market.  From their responses to date, they appear to say that their organizations have not prepared for the futures that await them.   

For the moment all attention in the United States is focused on the White House’s healthcare initiative and pending legislation. That is today but what about the market only five years away?  It is unclear whether or not large drug companies have planned that far ahead. What we see are lots of Big Pharma mergers mostly to rebuild or shore up the pipeline. This controls for short-term stock market reaction and may shield these firms in the long-term.  If preparation is the key, I am not sure that mergers alone will future proof your competitive portfolio. Take the survey and see how your peers view these futures.
Warning flag #3 – Too many companies are riding on guidelines that offer only legal lip service.  For the last two years we have been running a new survey on corporate ethical-legal guidelines for information gathering. We are about to close this survey. What I have seen until this point is that most large companies issue legal and ethical policy statements for competitive information collection. That is fine but not adequate. Many respondents who work for these companies also declare that they have not seen or know in any depth policy details or how to apply their information-gathering guidelines. Company management always has lots to do; these types of legal policies seem to fall to the bottom of the pile once issued – that is until someone steps over the ethical/legal line and calls negative attention to the corporation.  Stay tuned for a summary of this survey and implications it teaches us all.  If you are interested in trying out this anonymous survey for yourself, just click here.  You will have automatic report card sent you upon completion.

China, healthcare, and ethics, are all competitive issues that will remain with us for a very long time.  During the quiet weeks ahead, think about how your competitive landscape is changing and the challenges that you and your company will face in 2010 and beyond.

I wish you a quiet next couple of weeks and a successful year ahead.