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Play your part

Changing pharma's reputation requires all parties engage in managing stakeholder perceptions

Upwards shot of people in a circle holding handsAnother month and it's another criticism of the pharmaceutical industry. The Independent headline screaming: “Drug firms bankroll attacks on NHS” brings the issue of industry reputation into sharp focus yet again. Should this most recent story be dismissed as the latest in a series of over-hyped isolated incidents, or is it a sign that industry reputation continues to worsen? Does reputation matter and, if it does, what can we do about it?

Importance of reputation
Put simply, reputation is the sum of all stakeholders' perceptions and few would disagree that it is of great importance. However, when new issues spring to prominence with increasing regularity, is addressing stakeholder perceptions really a priority for the pharmaceutical industry?

It could be argued that time and resources are better spent on sorting out pipeline and reimbursement challenges and designing new ways of working within cash-strapped health systems. However, far from being separate from these pressing and immediate problems that face the industry, a declining reputation feeds and even creates these issues, making them harder to address successfully. So what can we do to turn the tide?

Relationship building
It seems that few outside the industry understand the true nature and mechanics of the pharmaceutical business. How many people truly appreciate what's involved in developing innovative medicines and the regulations that govern operating practice at every level? The answer is hard to quantify, but it is certain to be a select few. It should not be a surprise then when we see the sort of misconceptions and misunderstandings put forward by those responding online to the article in The Independent.

The industry has often been criticised for fostering the mystery by remaining distant and choosing not to respond to negative stories in the press. However, there is a sense that this traditional model is starting to shift. Collaboration with stakeholders and long-term partnership building is seen increasingly as the way forward.

Unfortunately the pace of change is somewhat restricted by a complex mixture of factors. These include the regulations themselves and the organisational structures of many pharmaceutical businesses. In some cases the challenges involved in progressing stakeholder communication are being positioned as reasons not to try, rather than obstacles to overcome.

Guidance on how existing models can be made to work within the new healthcare environment (such as the Healthcare Communication Association's Good Practice Guide on Working with the Media) are useful practical tools in the short-term. Ultimately however, what's needed is a top down re-evaluation of the terms of engagement with stakeholders and the business processes and structures that help (and hinder) good relationship building.

Progress is being made and there are examples of genuine innovation and enlightenment. Interviews with a range of figures in the industry, conducted over the past two years, reveal some key themes in how this is being tackled:

1. Integration and alignment
With a more fluid and dynamic stakeholder picture, and greater interaction between groups, companies need to be aware of how they communicate to each and every interested party, knowing one can hear what was intended for another. The standard set up, where different divisions are responsible for specific groups of stakeholders such as government, patient groups, media and investors, is being challenged by some companies which are finding ways to bring traditionally separate functions together and integrate the way stakeholder relationships are managed.

2. Listen more, talk less
A company's reputation depends heavily on its ability to engage in dialogue with all stakeholders. Understanding and mapping those groups and individuals is a challenge in itself, but perhaps more important is the move away from just delivering a message towards having a two-way conversation and listening to what stakeholders have to say. This can be a challenge on many levels, from resource to regulatory, but it's not impossible. It is difficult because it requires a re-working of traditional models and processes, but is something that must be tackled because it is so essential to effective operation. If nothing else, blogs and their user-generated cousins allow us to be privy to opinions and feedback that we might not have otherwise been able to hear.

As a minimum, we will need to find ways of monitoring social media despite the legal hurdles that are yet to be overcome.

3. Focus on their needs
Stakeholders are not interested in what companies have to tell them unless it's aligned with their own interests and agenda. The focus needs to be on providing information and services of real value, at a time and in a format that suits the stakeholder. For this to work, it follows that really understanding what that value looks like is critical, as is keeping on top of those needs and wants as they change. Identifying overlapping or aligned goals provides endorsement and confirmation that the information being shared is a correct and accurate representation of the facts.

4. Be in it for the long-term
A key challenge for the industry is to find a balance between reconciling the short- and long-term requirements of the business. Without doubt, the best way to increase stakeholder understanding is for these relationships to be long-term and forged at a strategic level, rather than the level of short-term product sales. Those who see the value of long-term relationships also understand that it takes time to build trust. However, the reality is that sales targets are short-term and it therefore follows that much of the tactical activity has a short-term focus. This obviously raises very interesting questions about what 'return on investment' actually looks like within the bigger picture, but the debate is necessary and most welcome.

5. Step up and get involved
There is a school of thought that industry should steer clear of trying to put its side of the story forward: if comment or response is provided by companies, or even industry bodies, it gets misinterpreted anyway and only serves to prolong the debate when everyone would much rather it went away. But if the industry doesn't present its case, someone else will do it for us, and not in the way we would like. Resolute silence, a 'no comment' or even a vague 'holding statement' will never put an end to an uncomfortable conversation, it will simply add to the intrigue, conspiracy theory or sense that there has been some wrong-doing. Rather than shying away from the challenge, shouldn't we engage more?

It's noticeable that the voice of the industry was absent from the responses to the piece in The Independent. For the pharmaceutical industry's reputation to improve, we all have a role in addressing misconceptions when they do occur in the media, even if it's by simply calling the journalist and explaining another point of view. There is the potential that addressing 'micro' brand issues as they arise could help with the bigger reputational issues we face.

6. Educate
It's not just about responses; proactive education is critical too. It's easy to get frustrated at the inaccuracies in some media reports, but ultimately it's the responsibility of everyone working in the industry to educate and increase understanding. If audiences are to take note of the industry's point of view, to bring some balance to the debate, proactive education on the complicated ins and outs surrounding the provision of healthcare is essential. Facts and figures are important, but if people don't understand their relevance or implications they won't be equipped to make well-informed decisions and assess what they read in the papers or online with a critical eye.

Finding more opportunities to update and build relationships with the media and the public outside of high-octane situations is an important factor.

Competitive environment considered, the critical element is sharing all the information we can. Ultimately, giving information is only seen as unethical if it is done selectively, based on commercial interests or if it is embellished. In fact, most of the reputational issues facing the industry have been caused by 'failure to disclose' as opposed to 'too much information was provided.' This need for transparency and full disclosure of information has been widely debated.

Perhaps more importantly, transparency also needs to extend to motives. Being overt about a company's commercial aims is not a bad thing and there is a strong chance that stakeholders will even respect this honesty. There is a risk that statements about improving the lives of patients, however true and well-meaning, will be perceived as worthy at best, but without credibility at worst.

Do something
Ultimately, the key is to take action with both a top-down and bottom-up approach. This particular challenge is unlikely to go away, so some acceptance of reputation – as both an issue and a priority – is the first step. Having good intentions and senior level leaders that are prepared to tackle reputation issues proactively is important, as is the commitment to effect change by those at the coalface. There is no 'big ticket item' that will 'fix' reputation wholesale. Rather, it will be the sum of many small things that is going to make the difference.

If we really want to improve the way we are seen it's going to take all of us playing our respective parts.

The Author:
Caroline Gosling is managing director of Virgo Health PR

18th November 2008

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