..Information to Pharmacists
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Your Monthly E-Magazine
DECEMBER, 2003

NEIL JOHNSTON

A Management Consultant Perspective

Where to from Now?

The year 2003 has almost finished on a less than satisfactory note.
With little effort, the soft underbelly of pharmacy has been exposed, and it is not a very pretty sight.
Of course there have been a number of band-aided steps taken, but how much lead-time will that give us?

On the negative side we have seen:

* The potential in strategic loss for pharmacy if Mayne pharmaceutical distributors (Faulding) were to fall into hostile hands, in particular, the hands of Woolworths.
* The low level of control that pharmacy actually holds over its own market.

* The inadequacy of scale when a group of small to medium businesses have to battle it out with major retailers, whether home grown or global.
* The down-scheduling of some medicines that most pharmacists think is inappropriate, yet a significant minority of pharmacists do not seem to agree. They do not, or are unable to support the sale of these products with suitable counselling and regard them as items of normal commerce by selling through bulk display and price promotion.
* The inability of the players in the supply chain to get their act together, to provide an efficient and cost-effective supply process, competitive to food operators.
* Pharmacist availability worsening, both in community pharmacy and hospitals.
There is a crisis looming here despite an increased intake at universities.
The ultimate battle for survival will be decided around pharmacy's ability to recruit and retain adequate pharmacist human resources.
Retention will evolve around interesting work, pay structure and opportunities, which are unavailable in current pharmacy models. This will only occur with restructuring into larger pharmacies, both in size and in numbers of units.

On the positive side:

* We see a surge demand for Home Medication Reviews and some of the major public teaching hospitals providing medication reviews on discharge.

On the leadership side:

* We see a strategy of "more of the same", which translates to building more protective legislation around pharmacy practice.
While there is some necessity for this to occur, it should not occur in such a fashion to totally shield pharmacy from global competitive forces. This only creates a long-term weaker pharmacy structure.
The protection that has emerged recently can only be regarded as short term, and pharmacy must develop more effective business methods to counter the onslaughts that it is receiving currently, plus what is to follow in 2004.
But even before this, there is a need to get the regulatory situation right.
There has been very little movement on the harmonisation of the various state and territory Pharmacy Acts. The Wilkinson Review highlighted the need for Pharmacy Boards to "butt-out" of the business side of pharmacy, and just regulate to protect the profession.
Business structures, such as companies, should be the prerogative of the operators; registration of premises and whether they can be sublet, should be able to organised without restraint.
There has been more than enough time since the various investigations, inquiries and reports have been completed, but infinitesimal movement by our leaders acting on the various recommendations.

We are one, but we are many:

* There are many diverse elements in pharmacy, represented by the attitudes and values of individual practitioner pharmacists.
We are one when we fight for and on behalf of pharmacy.
But we are many when it comes to tactics and strategy, which means we appear to be weak and divided.
And we are, because we are not organised properly, and do not have the weapons to fight with.

It is time to design a structure that allows all these elements to compromise, negotiate a consensus, and practice under one roof.
This will still create a number of "tribes", but there will be fewer of them.
They will be diverse and competitive, but they will each be strong and able to stand on their own two feet.

As Pat Gallagher points out in the article he has prepared for this final edition of 2003, the rate of change that is occurring, and will accelerate over the next five years, will be roughly equivalent to the change process embraced by the last 50 years.
Individuals are simply not geared up for this multifaceted change, that will require an amalgamation of skills in a group dynamic, just to be able to cope.

If we do not create our own change in structure and scale, we cannot hope to retain control of pharmacy, because the Woolworths of this world will seem to do a better job, and have the resources to really do it.
This loss of control is already sensed by the major predators.
They have tested the bulwarks to design and refine their strategies, so now they will attack in earnest.

The "script factories" that seem to embody a successful community pharmacy are not attractive to young pharmacists, for they cannot use their newfound knowledge to best effect.
And the buffer created by retail sales has been diminished through lack of interest, or criticised by those elements that do not understand marketing tactics, or the need to have a separate activity to balance out the periodic losses that occur in the health ledger.
They (script factories) are not attractive to older or retired pharmacists, for it involves long hours of standing and checking the passing parade of ever-increasing prescription items, which is an insult to anyone's intelligence.
It does not allow for sufficient time or space to create comfortable working conditions for all staff, and while the customers/patients must always come first, unhappy staff will not create the right impression. They are simply too tired and stressed to give of themselves.

And when quality standards are imposed on this "potpourri" of frenetic activity, you get two extremes.
The larger scale, well managed pharmacy, which had already developed its own quality standards (otherwise it would not have reached that condition) simply updates according to the "party-line" with relative ease, and then aspires to the next level.
The not so fortunate find themselves involved in a range of activity which is not part of their internal culture, and the process does not work for them.
This group aspires to accredit maybe once, but then slips back.

It is too stressful.

This is not to say that recognised standards should not exist in a pharmacy, but not all pharmacists are created equal, so an equal response should not be expected.
The step-by-step management processes that are required for change, have not been developed to provide a desired end-result.
Quite frankly, the accreditation process as it currently exists, is a scare tactic that is not designed to produce a permanent cultural change.

Until and unless there is a cultural change in leadership, the followers are unable to respond.

Let us hope that 2004 we can aspire to a more peaceful environment
after a relaxing festive season.

Neil Johnston