5 Reasons To Invest in Looking Good
Not all reputation management programs are a waste of time, energy and resources. Here are a few valid reasons for investing
in boosting a pharma company's reputation
1 The most important reason to get people to think well about your employers is above the pay grade of humble marketers: investors
need to believe that the company is dynamic, thrusting and whatever else Fabulous Fab and his friends value in a stock these
days. I have kept a Financial Times article from a decade ago listing the 16 products from a favored company's pipeline that would "guarantee a growing revenue
flow". Only one was ever launched and it is likely to be withdrawn. As you may have guessed from the well-known behavioral
patterns of the financial sector, the FT has never done this review itself.
2 At the 100,000-foot level, pharma needs what Jean-Pierre Garnier calls "permission to operate": in modern societies, industries
need some level of societal acceptance if they are to be viable over the long term. One of my colleagues at Baird's CMC, Simon
Bryceson, calls the loss of this legitimacy, "The Tobacco Road." Fast food and soft drinks manufacturers worry that they are
some way down this road; Simon thinks that pharma may be so far down it that it cannot turn back. He says that when he presents
to the main boards of Big Pharma companies about it (as he has often), there is a lot of nodding. It requires PhRMA to find
some new breakthrough strategy, or it requires an individual company to break out: could, for example, a pharma company create
a competitive advantage by becoming a socially-more-accepted medicines company? I have never found a client brave enough to
try, and I have to say that I have never been able to show the more courageous ones a precedent suggesting that it might be
worth risking a career on—especially when that career is likely to be finished by the time the end of The Tobacco Road is
in sight. I encourage my Braveheart readers to get in touch on Linked In and we'll pursue the idea.
3 At a 1,000-foot level, many companies depend on a close working relationship with governments and the public sector. They
need government research funds to develop a new vaccine or they want to license the discoveries made in a government or university
laboratory or they need a change in legislation to protect a patent. Officials and lawmakers get nervous if these necessary
arrangements are likely to face particular press or civil society criticism. In this age of Twitter campaigns and sarcastic
You Tube videos, the average politician makes the average duck-billed platypus seem a reckless risk-taker, so it is important
to avoid corporate reputation damage in areas where you are likely to need public partnerships. This, though, usually involves
substantive concessions—a subsidized access program, for example—rather than burnishing the corporate image or running ads
in 9-point type in The Economist (one more question for the Quiz: who used to run those incredibly expensive double pagers, week in and week out?). I understand
corporate campaign contributions also sometimes help to soothe frayed nerves.
4 In a survey that one of my pharma clients did, over 60 percent of employees said that they had lied at least once about where
they worked because they felt ashamed of it or because they felt pressure to do so. You do not need to be signed up for the
full touchy-feely HR credo to believe that this is bad for business. We have studied the internal impact of corporate social
responsibility programs and of a good reputation, and they do affect employees' likelihood of staying with the company and
their willingness to act as ambassadors for it. If you suggest this as a reason for spending your marketing budget, you are
unlikely to have many future opportunities to act as an ambassador for anything except, maybe, the joys of a sparkling WC.
As a reason for a joint investment by public affairs, marketing and HR, it is underused.
5 CEOs, chairmen and board members suffer from a related syndrome but they can't lie about where they work, so they spend instead
on "good deeds." In Europe, they might even get a title out of it or a handsome sash to wear at formal dinners or an award
from some minor member of a Royal Family. These corporate social responsibility programs are what the corporate yacht was
in an earlier age: the chance to build contacts and to get into elevated social circles. I'm sure that you couldn't show that
the yacht directly helped make deals or build profits and you certainly cannot show that these programs do. My limited diplomatic
abilities constrain me, but others make a lot of money out of producing the glossy card brochures, the coffee table books
and the corporate ads with generic pictures of African villagers bought from Internet photo agencies.
Mark Chataway is co-chairman of Baird's Communications Management Consultants. He can be reached at email@example.com