In part 1 of this story, we read about an exemplary decision taken by Virginia Herold, of the California Board of Pharmacy. We continue with our analysis of the decision.
Our analysis of the decision:
As a leader, understanding when to stress for perfection and when to go ahead and do things is a very important judgment call. In our opinion, Virginia and her team have made a bold, but correct call. We believe the decision should have been taken sooner.
In a recent webinar, Ms. Herold fielded a number of such questions from the industry. The message that she sent out was loud and clear. The California Board of Pharmacy wants to set the ball rolling. That’s why they came up with the phased approach. It is better to start serializing drugs and figuring out solutions to other issues as more information becomes available, than to sit on the sidelines and wait for clarity even as counterfeit drugs continue causing loss of life and revenue.
As a leader, Virginia Herold and her Board have displayed an exemplary comfort with ambiguity. They know that this is one initiative where you cannot strive for perfection. This is a great example for effective leaders to follow.
In arriving at this decision, the Board would have analyzed things somewhat on the following lines:
Assessing the situation:
1. Counterfeit drugs have infested the country. The FDA is working on it (the perfect regulation) and Congress needs to decide. This will take a long time.
2. We are responsible for patient safety in California. Our patients need to be able to trust the drug supplied by their pharmacy. We can control (and have a duty to) the California market.
3. Regulations need to be solid, unambiguous and complete. But we do not have the information to establish such regulations. We do not know how long we will have to wait. In the meanwhile, the counterfeit menace is growing. Something must be done soon.
4. In California the volume of counterfeit prescription drugs is roughly 3 million. Too many patients’ lives are at risk.
What can we (the Board) do?
1. Restrict our regulation to the California market
2. Adopt a phased approach. Give manufacturers time and some leeway.
3. Communicate with all stakeholders to let them know that this regulation is in the best interests of everyone. Every manufacturer loses revenue and reputation when their drugs are counterfeited and sold to patients.
4. Have the experts from the industry propose solutions to unanswered questions.
5. Amend the regulation when appropriate.
6. Gradually start imposing strict penalties as the regulation becomes more solid and familiar.
7. Not doing anything is NOT an option. We better get moving.
Leadership lessons from the decision:
a. The leaders MADE a decision.
b. The leadership clearly understood the problem. They recognized that this situation is one where perfection is almost impossible. They’d have to wait forever. (tip: in most cases perfection is not mandatory – see the Boeing exception below)
c. The leaders weighed the costs of not doing anything versus beginning the task.
d. They allow for flexibility (amendments or changing track), as clearer information becomes available.
e. They communicate early, often and clearly with stakeholders to ensure that everyone understands the approach.
f. They work with other teams. Collectively teams provide more options and it becomes easier to solve problems.
g. They understood their limits and restricted the regulation only to the products sold in the state of California.
A contrasting example:
Now let’s look at another example that of Boeing’s 787 Dreamliners and the story of the onboard Lithium-Ion batteries catching fire. To summarize, fifty 787 Dreamliners that were sold have now been returned and are languishing with Boeing. This was caused by some of the Lithium-Ion batteries catching fire when in flight.
In contrast to the California regulation, this is an example where the leadership should have waited. Instead they rushed to beat their competition and are now facing the consequences.
Effective leaders need to recognize when to wait for perfection (the Boeing case) and when to go ahead with limited information and build along (Virginia and the serialization regulation).
Do share your comments below on this post and I welcome any stories you may have on this very interesting topic.