Abbott CEO gives a great lesson in accountability
Posted on July 19, 2018 by Medtech[y] Staff
During Abbott's most recent earnings call, an analyst asked a question about Abbott's neuromod performance and Abbott CEO, Miles White, gave an absolutely brilliant lesson in accountability.
All right. Thanks Miles. Very clear. And just another quick focus from me was the neuromod, a focus for the quarter. You are kind of anniversarying some fairly explosive growth in that business. But can you just discuss the relative change in neuromod growth this quarter, the drivers of it? What are you doing to address it? And do you believe this portfolio can get back to market growth? Thanks so much.
Yes. Good question. You have got a couple of things going on here, one of which you observed. Explosive growth last year, which is actually interestingly a part of the problem. I think this was a bit of a self-inflicted wound. This is a business where the business is very dependent on the involvement of the representative, the sales representative, et cetera, not only with the physician but also with the patients. And we did not expand our sales force in concert with the rate of explosive growth we experienced. And when we finally did expand our sales force recently, it turned out to pretty disruptive to do that in the way we did it.
And I would say, the issue we created for ourselves was disruption in our own sales here with additions of new salespeople and new service people in the field and so forth. You re-cut territories. You have a lot of training and so forth. So I think we have added to our comp issue here. So do I think it gets back to market growth? Yes, absolutely. I think this is a temporary condition created by us. It will fixed by us. And we will figure out how to successively expand our sales force in concert with our growth in, let's just call it, a smoother fashion in the future. We did this to ourselves.
We've listened to our fair share of earnings calls in the neuromod space, and compared to the others, this was a a refreshing take. There are a number of CEO's that never take accountability, blaming sales management or someone besides themselves. Questions from analysts are brushed off and not answered thoughtfully, or at all.
For this, Miles White deserves a lot of credit. He answered the question honestly, without throwing anyone under the bus and held himself accountable for the neuromod's performance.
Here's to hoping other CEO's in the space listened to the call and took some leadership notes from Mr. White.