Posted by: Jena McGregor on July 02
Today's New York Times has some good advice for professional users of the popular micro-blogging service Twitter. It features the 24-year-old Bonnie Smalley, a customer service representative for Comcast, one of the earliest corporate adopters of using Twitter to help resolve customer service issues. (It had to try something new, after all--the cable provider's service reputation has long been notoriously poor, inspiring its own hate sites and even violent acts by angry 75-year-old women.)
Here's a summary of the tips Smalley (Twitter name: comcast bonnie) offers:
--Use a "console" application rather than a browser for faster posting and less crashing.
--Post a picture of yourself to humanize the brand.
--Employ privacy settings in case you also make personal tweets.
--Find the bookmark function on Twitter (yes, it has one).
--If you tweet professionally, set parameters on your time.
Posted by: Arlene Weintraub on June 24
A product recall is every company's worst nightmare. But for tiny Matrixx Initiatives (MTXX)--maker of Zicam cold remedies--the June 16 recall of two of its products was particularly painful. The company's herbal nasal gel and swabs, recalled because of reports that some patients lost their sense of smell after using them, accounted for 40% of Matrixx's $112 million in sales last year. Matrixx's stock dropped a sickening 70% to $5.78 on the day of the recall.
Luckily, Matrixx's acting president William Hemelt had a lot of advice from three board members who know a thing or two about responding to a product crisis. Chairman William Egan, and directors Lori Bush and Michael Zeher are all veterans of Johnson & Johnson, the company that is still held up as the model of good corporate citizenship for its handling of the 1982 Tylenol scare. "We talked about Tylenol many times," Hemelt said in a phone conversation a week after the Zicam recall. Hemelt's most important takeaway: "Being up front with people is a good idea."
Matrixx executives have spent the last week doing some big-time damage control. They had a shareholder meeting on the 18th, and have been busy updating the Zicam Web site to keep customers fully informed. Click on that site today and you'll see a video of Hemelt himself urging customers to return any gel or swab they may have for a complete refund. "Your safety has always been and will continue to be our number one priority at Zicam," Hemelt says in the video. He adds that the company has requested a meeting with FDA officials to "show them our extensive safety data."
What's particularly challenging for Matrixx, however, is that Zicam is one of only three brands it owns, so its entire corporate identity is tied up in it. And even though there are still 17 Zicam products on store shelves, the overall brand image has taken a serious hit. Hemelt hopes that communicating openly with customers will be the key to restoring the brand's cache. On June 22, the company took out a full page ad in the New York Times that blared "Thanks to our millions of loyal Zicam users! We're still here for you!" It pointed readers to the Web site, where they could also download a coupon.
And Matrixx has been out front about its legal liability, with a Web site it dubbed zicamlawsuits.com. It sounds like a site that a voracious product-liability lawyer might invent to recruit patients who want to file claims. But in fact, Matrixx put the site up as a repository for documents from the 10 federal lawsuits that have been filed against the company. "We've been very successful in this litigation," Hemelt says. "We're trying to correct misinformation."
Will the massive PR push be enough to save the brand? Even Hemelt can't say for sure. He hopes the lull before cold-and-flu season will give him some time to save face with customers, before they start looking for relief from their sniffles. "We will take whatever steps we can afford to protect the brand," he says. Unfortunately, though, he's lacking one of the biggest assets that saved J&J after the Tylenol crisis: lots of other strong brands to soften the blow.
Posted by: Matthew Boyle on June 23
Wal-Mart’s new CEO Mike Duke took another step towards delivering on his promise to promote diversity at the Bentonville-based retail giant on June 22 by naming L. Mecole "Cole" Brown to oversee the company’s diversity efforts.
Wal-Mart hired Brown in 2002, and she was named vice president of employment practices in 2007. She replaces Charlyn Jarrells Porter, who held the post from 2004 until she announced her retirement in March.
Brown’s promotion comes on the heels of Duke’s creation of a global women’s leadership council comprised of senior leaders from the 15 countries in which it operates. Duke first spoke of the council publicly at Wal-Mart’s shareholder meeting June 5. Among the council’s members are Wan Ling Martello, a senior VP of finance and strategy at the company’s international operations and a rising star inside the firm.
Duke expressed frustration at the slow pace of the company’s diversity efforts. “I want to move faster,” he said, during an interview after the shareholder meeting. "It’s an opportunity that I want to be more personally involved with."
Of course, as Duke well knows, it is one thing to create star-studded councils and make high-level appointments. It’s quite another thing to actually deliver. Further complicating matters is a class-action sex discrimination lawsuit hanging over Wal-Mart’s head, which could head up again later this year.
There’s also a new book due out soon showing that Wal-Mart’s success “has depended on a bizarre reconciliation of Northwest Arkansas's uneasy cocktail of anti-corporate populism, racial homogeneity, evangelical Christianity, and free enterprise,” according to a post in Slate’s The Big Money. The book will no doubt rekindle discussion of Wal-Mart's corporate culture, which has come under fire for not doing enough to attract, retain, and promote women and minorities. At the moment, in fact, there is only one woman among Duke's eight direct reports: Executive Vice-President of People Susan Chambers
In all, Wal-Mart’s new diversity chief has quite a challenge before her. At least she’s got the ear of the CEO, which is a good start.
Posted by: Arlene Weintraub on June 18
Drug company CEOs will be driven to look for more M&A opportunities, according to a new report from Frost & Sullivan. In the first half of the year alone, Merck bought Schering-Plough, Pfizer bought Wyeth, and Roche bought the portion of Genentech that it didn’t already own. But there’s plenty of opportunity—and free cash—for more such deals. And Frost predicts that those holding the money the will be looking very closely at opportunities in the beaten-down biotech industry.
What’s so attractive about biotech? For one, the barriers to entry are much greater than they are for traditional drugs. Biotech molecules are large and complex, and difficult to manufacture. And despite President Obama’s insistence that generic biotech drugs would save the healthcare system billions, there is still no path through the FDA for approving them. So companies that invent biotech blockbusters are protected against competition for decades—often even beyond what their patent protection allows. Should such a pathway emerge in the next couple of years, allowing older biotech products to go generic, drug companies can protect themselves by padding their pipelines now with brand new biotech molecules.
In the past, Big Pharma companies were more comfortable partnering with biotechs, via licensing deals, rather than buying them outright. That way, the licensor could finance the clinical trials, rewarding the licensee in dribs and drabs for various milestones that were reached along the way. If the trials failed, the licensor could walk away relatively easily, without suffering much pain to the pocketbook.
But then the recession happened, and everything changed. Thousands of biotech companies are out of cash and fighting for stay alive, presenting tempting deals that weren’t there before. The Amex Biotech Index has dropped 12% in the last 12 months. With prices down, it has suddenly become less risky for pharma companies to buy promising molecules—and the companies that invented them—rather than to leave those biotechs as free agents that could get snapped up by someone else.
As for who’s likely to buy, you can narrow down the candidates by looking towards the companies that have huge cash hordes. Among them: AstraZeneca with $4.3 billion, GlaxoSmithKline with $5.6 billion, and J&J with a staggering $10.8 billion.
Posted by: Diane Brady on June 17
As further evidence that leaders are nervous, multinational companies are planning to send fewer employees on global assignments this year. According to an annual survey of 180 corporations by Brookfield Global Relocation Services, more than two-thirds said they will decrease or, at most, maintain expatriate levels.
Interestingly, those that do relocate employees are increasingly turning to older and more experienced workers. Only 9% of expatriates in surveyed companies were 20 to 29 years old -- the lowest in the survey's 14-year history. The number of female expats is also down to 20%, from 23% a few years ago. And 49% of expats were accompanied by children (the historical average is 57%). Picking older workers with grown children eliminates at least one of the major concerns in relocation: finding decent schools.
One troubling issue emerges from the study. If companies are reducing expenses for international assignments in response to the current climate--as 68% said they would--how are they going to prepare the next generation for global leadership?
