GlaxoSmithKline made news last year by announcing it would overhaul sales-rep compensation. The aim: Aligning reps' performance goals with company values, GSK said. Transparency and integrity, for two. The company didn't say so directly, but the implication was that the usual sales quotas and bonuses incentivized behavior that didn't exactly conform to those values.
In January, GSK got rid of individual sales goals, and now, the second stage of that plan is coming to fruition. Instead of earning bonuses based on sales goals, reps will now have their incentive pay determined by three things: their own selling skills, evaluations from doctors and the performance of their business units as a whole. The company says it's spent the last year researching and developing assessment tools to use in evaluating the reps.
Announcing the latest move, GSK again cited "values" and "ethics," saying that the new compensation plans will also help assure doctors that its sales folks "are focused on improving patient health." Rather than on making their numbers, presumably. "Along with changing many aspects of how we conduct our business, we have also invested heavily in training and compliance programs to ensure that we are operating at or above the pharmaceutical industry code of ethics," GSK's North American President Deirdre Connelly said in a statement.
Given the ongoing news about pharma marketing infractions--for instance, the Justice Department settlements that have been regular installments in industry news--it's no surprise that GSK might want to invoke ethics and values, in an attempt to distance itself from that misbehavior. That it's changing its methods to improve sales integrity could offer more distance. And if GSK comes out with its own Justice Department settlement--it set aside money for that purpose earlier this year--it can point to these changes as evidence that it has, well, changed.
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