Monday, November 30, 2009

Afghanistan Speech Plan

Notes for the President
Tomorrow evening, President Obama will address the nation from the US Military Academy at West Point. After three months of deliberating with his “war cabinet,” the President will outline his decision, which is presumed to include sending 30 – 35 thousand additional troops to Afghanistan. Word has been leaking for weeks (from sources including the military) about the proposed strategy, and the sides for and against it are already well developed.

We know that President Obama can deliver a great speech, but I thought I would offer up a few ideas on how to make communicate this crucial communication with maximal effectiveness. Here is what his address should contain:

The Background. It’s laudable that the President has adopted a stance of (at least attempting to) not dwell on the past. The answers are ahead of us, not behind. Yet, it’s important to explain why we are where we are. Not to be condescending, but the President should even consider using a map. Show the region, show the threats, show the opportunities. I know he’s been dinged for being “professorial,” but my view is that it’s a good thing. We have a President, a Commander-in-Chief, smart enough to give these important lessons to the public.

The Goal. Some have challenged the President to accept the military’s recommendations and move on. It’s a simplistic plea. A military strategy must support public policy goals. The question of why we are there and what we must accomplish in the name of national security must be answered first, clearly and plainly. Only after the planned outcomes have been stated can we decide on which strategies (military, diplomatic or both) are appropriate.

The Decision Process. As a corollary to the points above, it’s worth mentioning how this decision was reached. There has been criticism of the three months it has taken to debate the request for more troops. In the previous administration, many decisions came quickly, from the gut. Now, we have a more analytical, deliberative and inclusive decision making process. It needs to be explained. Moreover, the role of the military must be clarified – our civilian government should never be just a rubber stamp.

The Options. After hearing about how the information was gathered and analyzed, we should receive an overview (not the details) of the options the President had to grapple with before settling on his final decision. What were the pluses and minuses, and the potential consequences?

The Path Forward and Back. After laying out the options, make the case for the decision. What does it mean of us, for the people of Afghanistan, for the balance of power in the region? What are the consequences of increased involvement, when will we know when we’ve achieved our goals and how do we leave without causing more harm than good? And, what responsibilities will the world community shoulder? Can we count on a fairer distribution of the burden?

Acknowledge Other Worries. We all know of the disastrous experience the Russians had in Afghanistan. We know the parallels to Viet Nam are many. The President must address the concerns over another potentially bloody quagmire and how his strategy has the best chance of success. In addition, he should acknowledge the costs (human and financial), and the possible impact on the economy and on our security. He should also make the case that the seriousness of other issues – financial reform, jobs, healthcare, energy, climate change – means we must tackle our problems simultaneously, not sequentially.

Conclude with a Rallying Point. At the end, the President needs to seal the deal. That is, obtain the support of the majority of the American public. He needs to convince us that it’s time to get behind his decision and, most important, the brave men and women tasked with carrying it out. And, following the speech, surrogates from all sectors of society should be mobilized to reinforce the President’s message.

The content of the President’s speech must be spot-on but so must the tone. He must be perceived as truthful, authentic, realistic and reassuring. I’ll be tuning in at 8 o’clock tomorrow night to watch some history.


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Monday, November 16, 2009

The Pharma Pricing Dilemma

How to Rebalance the Picture
There’s front page outrage in today’s The New York Times. The pharmaceutical industry is roasted again in “Drug Makers Raise Prices in Face of Health Care Reform.” How much of the criticism is deserved, and how much is a result of poor communications or inadequate reporting?

The article cited several studies that link big increases in drug costs to legislative efforts – like bumping up carpet prices just before the big sale, or the rush to raise interest rates and fees before credit card reforms become law. The most recent study was conducted for the AARP by Stephen Schondelmeyer, a professor of pharmaceutical economics at the University of Minnesota. It concluded that drug prices increased approximately nine percent in the face of an overall decline in the Consumer Price Index of 1.3 percent. He told the Times, “When we have major legislation anticipated, we see a run-up in price increases.”

Not so, said Merck spokesman Ron Rogers. “Price adjustments for our products have no connection to health care reform.” But Joseph Newhouse, a Harvard health economist, said he found a similar pattern of stiff increases after Congress added drug benefits to Medicare in 2006. He said, “They [the industry] try to maximize their profits.”

No kidding. Of course the industry, any industry, wants to maximize their profits. Indeed, there’s an obligation to employees and shareholders. The problem is one of perception. What is smart business that helps to guarantee the long term success of the enterprise, what is abuse or greed, and what is corporate desperation?

The other side of this story is not told particularly well, and it’s hard to determine if it’s the lack of space accorded the pharmaceutical industry by the Times, the lack of a compelling message by the industry or both. The article states that “Drug makers say they have valid business reasons for the price increases” but then fails to explore it further.

Ken Johnson, senior vice president of the Pharmaceutical Research and Manufacturers of America (PhRMA), does manage to get a shot in by criticizing the study methodology and its sponsor. “In AARP’s skewed view of the world, medicines are always looked at as a cost and never seen as a savings – even though medicines often reduce unnecessary hospitalization, help avoid costly medical procedures and increase productivity through better prevention and management of chronic diseases,” he said.

Yes, good points, but readers are still left with questions and concerns. And, what about the cost of failure – the part of the price increases that are necessitated by the sheer difficulty of bringing new, differentiated medicines to the market? The reality is that, without the ability to replace innovative products lost to generic competition, outsized price increases will continue to play an outsized role in pharmaceutical profitability.

So, what needs to be done in order to achieve some balance, some greater understanding of the complexities in healthcare costs?

Provide proof. The industry must deliver concise, compelling and understandable information. Any spokesperson should be able to recite at least three pieces of evidence to support their position. And, if you believe the methodology of the offending study is flawed, develop your own bullet proof information.

Utilize credible supporters. The extreme pricing contention was delivered by two academics, a consumer group and an industry analyst. The industry’s position was staked out by the pharmaceutical trade association. It’s clear where most readers will place their trust.

Strike the right tone. Lashing out may be tempting but it could have the effect of creating sympathy for your adversary. And, in this case, the object of PhRMA’s annoyance – the AARP – represents millions of the industry’s customers.

Think about the timing. It may be that, as Catherine Arnold of Credit Suisse said, “If you’re going to take price increases, here and now might be the place to do that, because the next year and the year after that might be tough.” But, if these price increases cancel out some of the savings promised by the industry during negotiations over health insurance reform, don’t be surprised if some legislators attempt to exact new concessions with renewed determination.
Between blog posts, you can follow me on Twitter.

Friday, November 6, 2009

The Twitter Tail Wagging the Corporate Dog

This article also appears in

Social Media Are the Means, Not the EndsWhile scanning through a long list of Twitter posts the other day, I saw a link to TechCrunch, a blog “dedicated to obsessively profiling and reviewing new Internet products and companies.” An entry by MG Siegler, “Comcast: Twitter Has Changed The Culture Of Our Company,” caught my attention.

Sure, technology can help drive cultural change. Think of the tools of war over the centuries or what the automobile has meant to society. The examples are endless. But the culture of a company?

Yes, according to Comcast CEO Brian Roberts. In response to a question about the role Twitter was playing with the cable communications giant at the Web 2.0 Summit in San Francisco, he said “It has changed the culture of our company.” He backed that up by saying that Comcast uses Twitter to scan for complaints and engage with customers.

OK, maybe Mr. Roberts got caught up in the moment. After all, he was at a social media conference. And, it’s great that Comcast is using new tools (Facebook and other networks were mentioned) to address issues around customer service. However, this does not a culture make.

Tools support the strategy (and, thus, the objective), not the other way around. The tools of war support the policies of government. The automobile supports our mobility. You get the idea. Comcast delivers communications products and services. Its culture should be wrapped up in service delivery and excellence whether Twitter exists or not.

So, if Twitter really did change the culture at Comcast – all of a sudden becoming a company focused on customers and what they want – I wouldn’t be crowing about it. I’m guessing, but what may have happened was that seeing thousands of Twitter-fueled complaints was Comcast’s wake-up call. Twitter makes it easy to sound-off – much easier than having to find a telephone number to call, listen to the prompts, press 1, listen to some more prompts, press 4, and so on. Seeing this groundswell may have acted like a cyber-mirror and forced them to look at themselves, and reflect on who their customers are and how they conduct their business.

Web 2.0 offers us wonderful tools. We’re nowhere near realizing their potential or knowing how they will evolve. What should be known (and written in stone), though, is what our companies, institutions or organizations stand for. The decision to adopt a particular technology should only be made if it helps us achieve that end.

Between blog posts, you can follow me on Twitter.