Hologic’s GSP division is in a position to potentially be great, but the near sighted decisions of of the division’s leadership will limit the long term success. The old adage, “success covers mistakes” is incredibly true of Hologic’s GSP division. NovaSure has been a cash cow and market leader that has covered many mistakes over the years. The truth is, the company changes women’s lives in a big way... there is an opportunity to capture and serve the GYN market like very few companies are in a position to do... but HOLX is missing the moment.
There often is more power in asking the right question vs. delivering the “right” answer. Why are so many territory managers fleeing the organization? Aren’t we in the middle of a recession? These are the people with the most direct surgeon contact, patient interaction, & best understanding of the competitive landscape. If the territory managers saw a bright future within GSP, then HOLX wouldn’t be hemorrhaging talented professionals to lateral sales opportunities. What is the average tenure of a TM in the GSP division? I wagger it is getting shorter by the month. A lot can be learned from investigating this trend.
What is the cost to HOLX when a rep leaves the territory? Talk to HR... it is a huge cost both in terms of real dollars + opportunity cost within a particular territory.
Amongst the TMs, here are the facts:
Incredible pressure to win at all costs at the end of the quarter which translates into discounted bulk orders, favors, and a stuffed sales channel. End or quarter sales “spiffs” exists for the TMs that have sat on deals... the same deals done 1 week earlier render no financial reward. It ultimately pays to sandbag every quarter. How many MSOs / PCPs get released early in the final weeks? What is AUP in the final 2 weeks vs. the beginning of the quarter? There is crazy “stuffing” taking place nationwide. Sales is about delivery results, but within a product life cycle... revenues eventually decelerate. What is an aggressive, but organic growth rate. HOLX has likely exceeded what most would consider sustainable growth.
DTC Miss: Only a few truly know right now, but the $20MM DTC campaign doesn’t appear to have worked... yet the quota increases associated with the campaign still are tossed onto the sales force's shoulders.
Micro Management: Countless consecutive quarters of stuffing has lead to sluggish revenues... the company has responded with a physician call logging requirement.
Diminishing Financial Opportunity: Sales reps are “coin operated”... they accept financial uncertainty to participate in the upside. HOLX is continuing to add products, rapidly accelerating quotas and the realized compensation is continuing to decrease. More work for less pay. TMs can control their “numerator”... but the denominator for their PTQ % is not. Last year’s heros are often this year’s goats.
Chasing A Moving Target: Every quarter the pay plan changes! The specific incentives change every quarter. What was tracked, recognized, & rewarded in one quarter is forgotten the next. Quotas aren’t released until 4-5 weeks into the quarter. Reps fly blind 1/3 of the quarter, despite being compensated on the quarter. New non revenue generating middle management positions are created and essentially abandoned (through attrition) in a matter of a year.
Concentrated control and decision making: Nearly every decision is made at the very top of the division and force fed to the rest of the company. Original thinking is not really appreciated... upper management has a “speak when spoken to” attitude. Constructive conflict doesn’t exist... an alternative view puts your job security in jeopardy. There is a culture of “chain of command” which makes the organization very linear with many, may layers of middle management.
The DSM / RBD is often the target of criticism ... they truthfully have very little autonomy. They are the messengers / babysitters. Give the managers the opportunity to be leaders.
No Trust: The TMs don’t trust HOLX. They don’t trust the Adiana data. EASE says one thing, first hand experiences and reality are telling a very different story. How can a TM authentically sell a product that they themselves wouldn’t want a fellow family member to use? They don’t trust HOLX enough to really be honest with the company. Why did the company suddenly decide to hide the country’s quota figures in the middle of 2011? Transparency breeds trust, unfortunately HOLX’s GSP division isn’t very transparent and is getting more cryptic all the time.
All in all, there is the talent already within the division to be great! There are some TMs, DSMs, RBDs that have incredible work ethics and drive with proven track records. NS + the hysteroscopy are awesome. The physicians provide HOLX reps more access than nearly any other sales forces. The recipe for greatness is mostly in place. If there are company leaders / auditors / etc reading this post ... this unhealthy cycle can be fixed. It is going to require the courage to change up the top of the GSP division. A talented professional from the outside needs to breath a new culture and vision in the division. The foundation for excellence is there... it just needs to be refined and rediscovered.
There often is more power in asking the right question vs. delivering the “right” answer. Why are so many territory managers fleeing the organization? Aren’t we in the middle of a recession? These are the people with the most direct surgeon contact, patient interaction, & best understanding of the competitive landscape. If the territory managers saw a bright future within GSP, then HOLX wouldn’t be hemorrhaging talented professionals to lateral sales opportunities. What is the average tenure of a TM in the GSP division? I wagger it is getting shorter by the month. A lot can be learned from investigating this trend.
What is the cost to HOLX when a rep leaves the territory? Talk to HR... it is a huge cost both in terms of real dollars + opportunity cost within a particular territory.
Amongst the TMs, here are the facts:
Incredible pressure to win at all costs at the end of the quarter which translates into discounted bulk orders, favors, and a stuffed sales channel. End or quarter sales “spiffs” exists for the TMs that have sat on deals... the same deals done 1 week earlier render no financial reward. It ultimately pays to sandbag every quarter. How many MSOs / PCPs get released early in the final weeks? What is AUP in the final 2 weeks vs. the beginning of the quarter? There is crazy “stuffing” taking place nationwide. Sales is about delivery results, but within a product life cycle... revenues eventually decelerate. What is an aggressive, but organic growth rate. HOLX has likely exceeded what most would consider sustainable growth.
DTC Miss: Only a few truly know right now, but the $20MM DTC campaign doesn’t appear to have worked... yet the quota increases associated with the campaign still are tossed onto the sales force's shoulders.
Micro Management: Countless consecutive quarters of stuffing has lead to sluggish revenues... the company has responded with a physician call logging requirement.
Diminishing Financial Opportunity: Sales reps are “coin operated”... they accept financial uncertainty to participate in the upside. HOLX is continuing to add products, rapidly accelerating quotas and the realized compensation is continuing to decrease. More work for less pay. TMs can control their “numerator”... but the denominator for their PTQ % is not. Last year’s heros are often this year’s goats.
Chasing A Moving Target: Every quarter the pay plan changes! The specific incentives change every quarter. What was tracked, recognized, & rewarded in one quarter is forgotten the next. Quotas aren’t released until 4-5 weeks into the quarter. Reps fly blind 1/3 of the quarter, despite being compensated on the quarter. New non revenue generating middle management positions are created and essentially abandoned (through attrition) in a matter of a year.
Concentrated control and decision making: Nearly every decision is made at the very top of the division and force fed to the rest of the company. Original thinking is not really appreciated... upper management has a “speak when spoken to” attitude. Constructive conflict doesn’t exist... an alternative view puts your job security in jeopardy. There is a culture of “chain of command” which makes the organization very linear with many, may layers of middle management.
The DSM / RBD is often the target of criticism ... they truthfully have very little autonomy. They are the messengers / babysitters. Give the managers the opportunity to be leaders.
No Trust: The TMs don’t trust HOLX. They don’t trust the Adiana data. EASE says one thing, first hand experiences and reality are telling a very different story. How can a TM authentically sell a product that they themselves wouldn’t want a fellow family member to use? They don’t trust HOLX enough to really be honest with the company. Why did the company suddenly decide to hide the country’s quota figures in the middle of 2011? Transparency breeds trust, unfortunately HOLX’s GSP division isn’t very transparent and is getting more cryptic all the time.
All in all, there is the talent already within the division to be great! There are some TMs, DSMs, RBDs that have incredible work ethics and drive with proven track records. NS + the hysteroscopy are awesome. The physicians provide HOLX reps more access than nearly any other sales forces. The recipe for greatness is mostly in place. If there are company leaders / auditors / etc reading this post ... this unhealthy cycle can be fixed. It is going to require the courage to change up the top of the GSP division. A talented professional from the outside needs to breath a new culture and vision in the division. The foundation for excellence is there... it just needs to be refined and rediscovered.
