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  • Advice You - Cargo Cults and Management Practice

    During World War II, US forces took over islands in the Pacific where the residents had never see airplanes, or canned food, or any of the tons of material that a military force needs. The islanders were careful observers, though, and they figured out what th
    According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
    e military did to cause the goods to show up.

    This is what they saw. The military folks would go up into towers they'd built and talk into a box. Soon the material, or "cargo," would arrive.

    When the war ended, the military went away and the cargo stopped c
    ; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

    Examples of combination products may in
    ming. But some of the islanders figured that they could make the cargo come back. All they had to do was exactly what the US military people had done.

    So they went up in the abandoned towers and talked into the dead radios that were there. Sometimes they "
    lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

    built" radios from wood or other available materials. They did everything just like the military and they waited for cargo to arrive, but it never did.

    Those islanders were members of something we call "cargo cults." They were bright, observant people who c
    here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
    pied a behavior they believed would bring back the cargo. It seems silly to us, because we understand what airplanes and control towers and radios are.

    But it was magic to the cargo cultists and they tried the best they could to make it work. Just like lots
    d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

    Combination pro
    of managers do with the practices of other companies.

    Everybody, it seems, copies General Electric (GE), often in the area of forced ranking. At GE, managers are required to rank their employees into three groups. Twenty percent should be top performers. S
    ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
    venty percent are in the middle. And 10 percent bring up the rear.

    The idea is that you treat the top 20 percent as stars and they get the lion's share of the bonuses, stock options and rewards and opportunities of all kinds. You work to keep the middle 70 p
    easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
    ercent engaged. And the bottom 10 percent have to go.

    This system works at GE, much to the chagrin of many commentators. Because it works at GE and because GE has been a successful corporation for decades, some businesspeople decide to introduce forced ranki
    nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
    g in some form into their organization. They want to get some of that GE magic.

    The science fiction writer Arthur C. Clarke has said that "Any sufficiently advanced technology will be perceived as magic." When you don't understand what goes behind the success
    and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
    of the forced ranking system at GE, it looks magical, and magic always looks better than hard work.

    So companies adopt the forced ranking system without paying attention to any evidence about how it might work in their place. But, alas, there is evidence th
    ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
    t forced ranking is more likely to create problems than to magically create profit.

    The Novations Group surveyed two hundred human resource professionals who worked at companies with more than 2500 employees and asked them about how forced ranking worked. Ha
    ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

    Following aspects would a
    f of the companies used some kind of forced ranking system. Respondents to Novations' survey found that forced ranking caused lower productivity, lower levels of employee engagement, and increased distrust of leadership.

    If you're going to adopt the practices
    dd to the challenges in developing combination products:

    Which markets to tap where the combination products can do fairly well?
    Which combination prod
    used by another company, no matter how successful, you need to do some research into why it works there. In GE's case, the answer may involve things you can't replicate overnight.

    Forced ranking works at GE because there are two characteristics of the compa
    cts are meaningful and rational?
    Which therapeutic categories to select?
    Which Combinations can address unmet needs of the patients?
    Do combin
    y that support it. First, there is a culture of candor. Unlike most other companies, GE values and rewards candid conversations about performance.

    GE also has used an extensive and rigorous evaluation system for years. Combine candid communication with rig
    tions increase the patient compliance?
    What would be the developing cost?
    How to tackle the risks encountered during combination product developmen
    orous evaluation and you get evaluations that don’t come as a surprise. In other words, people know when they're not performing and don't fit.

    There's one other thing. Despite the rhetoric, GE doesn't automatically fire people who are in the bottom ten perc
    t?

    As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
    nt. There's often the opportunity to improve or try a different assignment before firing becomes the option.

    If you want to adopt the practices of another company or industry you have two choices. You can do it like the cargo cults, mimicking behavior and ho
    ping new procedures for reviewing their safety, efficacy and quality.

    Professional from academic institutions, pharmaceutical industries, health care indust
    ping it will get the same result. Or you can do a little due diligence and increase the odds that you'll make the right choice.

    Do a little research. Academics, consultants and graduate students are doing research all the time about what works and what does
    y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
    't. If you read the Novations' study as part of your due diligence, you'd know that forced ranking isn't the magic it might appear.

    Check out the companies where the practice works and a few where it hasn't worked. What are the differences between them? Wh
    .

    As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
    ich companies are like your company?

    If you're still not sure about adopting a practice, review the history of how it came to work in companies where it's successful. Tracing that history will often help you see organizational and cultural pre-cursors necess
    elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

    Companies that provide selfless information through particip
    ry for success.

    In this age of management fads, it's easy to take a cargo cult approach to adopting some new practice. But with a little bit of work and research you can choose wisely which practices you'll adopt and how you'll adapt them to your own company


    tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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