Ninety percent of McKesson’s annual revenue comes from its pharmaceutical distribution business. Over time, the pharmaceutical distribution business’ four senior vice presidents saw their span of responsibility—and their workloads—grow dramatically. Also, the organization didn’t have in place a satisfactory succession path for these demanding positions. To help bridge this gap, McKesson created the vice president/general manager (VPGM) position. Each VPGM would support and report to a senior vice president, who would retain oversight for their respective territory. The VPGMs, meanwhile, would assume responsibility for a portion of the regional portfolio and its associated distribution operations. The eight leaders initially tapped for the VPGM jobs had stellar track records of strong performance and had been clearly identified as having a high level of leadership potential; however, the leap to VPGM was a big step up. The sales vice presidents selected to be VPGMs lacked experience in distribution. The distribution vice presidents, meanwhile, weren’t knowledgeable about the sales function.
To help the vice presidents successfully transition into the VPGM jobs, McKesson created a leadership orientation program that DDI helped design and deliver, to give the VPGMs the knowledge, insights, and awareness needed to meet the challenges associated with the transition to the new role. In building the leadership orientation program, McKesson identified four major areas of focus, all of which support the growth of the business: building customer intimacy, enhancing organizational capability and building the business infrastructure, building leadership capability to enhance employee engagement, and influencing public policy within the regional markets. This program started by looking at the current demands of the pharmaceutical distribution business, including the key business challenges and priorities that would demand the VPGMs’ attention. It also examined the specifics of the VPGM role, its requirements, and what the VPGMs would be expected to achieve in order to ensure success. Finally, the program focused on building self-awareness, so the VPGMs could leverage their strengths and take action on their personal development needs, as identified through an assessment.
Having worked with DDI to design and implement the leadership orientation program for its VPGMs, McKesson has identified 65 measurable impacts on its business, including impacts related to financial success, operational success, workforce success, and customer service. In addition, McKesson has realized reductions in overtime and turnover and gains in productivity in the markets where the new VPGMs had been on board for six months. Senior leadership also cites improvements in customer responsiveness and work flow, as a result of having the VPGMs support the senior vice presidents.