Search this Site
Index of Posts
37 Signals 5000 Days Project Accenture Acer ACS Adobe Advertising Airbus Al Gore Alaska Airlines All Things Digital Amazon American Express Americas Cup Amway Andrew Mason Andrew Ross Sorkin AOL Apple Apple TV Asus AT&T Atlas Shrugged Audio Books Australia Autodesk Avatar AWS Ayn Rand Bailout Bank of America Baptie Barack Obama Barak Obama BBDO Ben Horowitz BestBuy Big Data Bill Gates Blackwater Blog Box BP Brad Feld Bradley Manning Bread Clip Broadband Bruce Hiilyer Business Insider Businessweek Buzz BYOD Camile McDormand careerbuildier Caste System CEO Channel Insider Channel Marketing Charlie Rose Charter Schools Chase Chasing Ice China Chris Anderson Chris Jordan Chris Paine Cisco Citi Group ClaimID Clay Shirky Clive Thompson Cloud Computing Cluetrain Manifesto Cnet Cognizant Collective Impact Comcast Comdex Compaq CompTIA Computer Operator Consumer Electronics Context Convergence Cookies Copernic Cost CraigsList Cranky Geeks Creative Destruction CSG CyberCrime Dan Pallotta Daniel Ellsberg Daniel Suarez Danny Sullivan Darren Huston Data Portability Dave Winer David Brooks David Carr David Engle David Letterman Deflation Dell Deloitte Delta Airlines DemandProgress.org Diaspora Dick Leon Digg Direct TV Disney Dr. Kent M. Keith Dreamworks Droid X Dropbox EarthPoint Ebay Economic Development Economies of Scale Economist Ed Snowden Edie Harding EDS Education Edwin Land Electronic Frontier Foundation Elon Musk email Emerald City Rotary Employment Security Department Enterprise Eric Schmidt Ericsson Escape from Las Vegas Euro RSCG Evan Williams Events Evernote Everything Channel Expedia Extreme Ice Survey FAA Facebook Fall of Giants Fax Machine FCC Felix Salmon FFacebook First Look Media Food Inc Ford Foreign Affairs Fortune Fox News Fred Wilson Free Future in Review Game Change Gartner Gas Prices Gatekeeper Gates GBill Gates GDP GE General Electric George Lucas George Soros Glenn Grenwald Gnip GoDaddy Goldman Sachs Google Google App Engine Google Fiber Google Maps Google+ Gordon Moore Government Groupon Gutenberg Halperin Hank Paulson Happiness Harvey Mackay Healthcare Heilemann Hemingway Hollywood Horsemen Hotels.com Hotmail HP HTC I-1240 IBM IEX Immigration Inc. Magazine India inflation Ingram Micro Instagram Insurance Intel Internet of Things Internet Week Intuit IOR iPad iPhone iPod Touch IQPC Ira Glass Iraq iTunes Jack Doresy Jajah James Balog Jaron Lanier Jason Fried Jay C Leon Jay Rosen JC Penney Jeep Jeff Bezos Jeff Jarvis Jeff Orlowski Jeffrey Katzenberg Jen Mueller Jimmy Wales John Dvorak John Edwards John Henry Brown John Mayer John Naughton Johnny Depp Julian Assange Kayak.com Keith Richards Ken Follett Kevin Turner KickStarter Kinect KIPP Kiva KPI Labor Unions Lance Armstrong Larry McMurtry Leadership League of Education Voters Lehman Brothers Lenovo Leo Laporte LeWeb LG Lists Liu Xaiobo Live Lloyd Blankfein Louie Psihoyos Loyalty Programs LTE MacBook Air MagnaGlobal Malcolm Gladwell Malcom McLean Marc Levinson March Madness Marissa Mayer Mark Hurd Mark Zuckerberg MarketWatch Matt Cutts Matt Flannery McAfee McDonalds Measurements Michael Lewis Michael Mandelbaum Michael Moore Microsoft Midway Film MIT Mitt Romney MMicrosoft MMidway Film Monaco Media Forum Moneyball Mortgage Motorola Movember MS Azure Natural Monopoly NBC NCAA Tournament Neal Stephenson Neel Kashkari Neil Barofsky Nest Net Neutrality Netflix Network Effect New Trade Routes New York City New York Times Nobel Prize North Korea Novell NY Review of Books NY Times NYSE Office 365 Ogilvy and Mather Om Malik On The Media One Question Open Book OpenGarden OpenStack OpenWireless Optimist Creed Oracle Osama bin Laden Outcome Outlook 2010 Panasonic Pareto Paul Krugman Paul Simon PBS PC Magazine Perot Systems Peter Byck Pew Pharmaceutical; Military; Wall Street Philippines Phone.com Photo Sharing Picasa Pierre Omidyar Piracy Podcasts Polaroid Predictions Priceline Privacy ProPublica Public Speaking Quality Quants Race to the Top Rackspace Rahm Emanuel Ray Ozzie Rebooting the News RetroDex Ric Merrifield Richard Stevenson RingCentral RingRevenue Robert Rubin Robert Scoble Rogers Russel Wilson Sailing Sale Sales Process Engineering Salesforce.com Sam Palmisano Samsung SAP Sarah Palin Satya Nadella Savings Rate scams Schumpeter Scientific Method Scott Patterson Seahawks Search Sears Sebastian Rupley SEC Security Self Organizing Sharepoint ShowNotes Shutterfly Signage Simon Sinek Siri Skype Slate Small Business Server SMB SMB Nation Smothers Brothers Soccer Social Media Socialtext Solomon Brothers South Korea Spray and Pray Squarespace SSteve Jobs Stand for Children Starbucks Steve Ballmer Steve Jobs StreamInsight Superbowl Supreme Court Surface SVP SVPi SWOT SXSW Sync Synnex Tasar Tech Data TechCrunch techflash TED Telephone Tesla The Advertising Show The Big Short The Box The Gates Foundation The Guardian This American Life Thomas Friedman Time Timothy Geithner Tina Fey Tony Fadell Toshiba Trade Deficit Transparency Trends Trust TSA Tungle.me Twilio Twin Towers TWIT Twitter U of W Umair Hague Uncanny Valley Unemployment UPCon2010 US Bank Vacation Value Vendor Relationship Management Verizon Vic Maui Video Conference Virtualization VMware Vodburner voicemail VolvoOceanRace Waiting for Superman Wall Street Wall Street Journal Walmart Walter Isaacson Warren Buffet Washington State Waste Wave Systems WIFI WikiLeaks Wikipedia Wildfire Wimbledon Windows Windows 8 Wired Won't Back Down World Cup WPC10 Writing wwpc2010 X1 Xbox 360 Xerox Yahoo Zappos.com Zillow Zynga
Search This Site

My Other Links
Sites I Like
Index of Posts

Entries in NY Review of Books (1)

Sunday
Jan222012

Doctors Paid to Make You Sick

The 800,000 physicians in the US comprise a large and intensely managed partner program for the drug companies.  We are about to find out how intensely managed as the Affordable Health Care Act (AHCA aka Obamacare) now requires the drug companies to disclose how much they pay your doctor to prescribe drugs to you.  It should not be a surprise that the drug companies pay doctors quite a bit, and those payments change doctor behavior.  So it should be no surprise to find that some people may be diagnosed with ailments they don’t actually have -- so the doctor can prescribe the pills and get the money.

Sales managers know that salespeople are “coin operated”.  Better performance from salespeople is purchased with commission plans that compensate for more sales, more upsells, more referrals, more attached sales, more anything.  Since our business is technology sales, and specifically channel partner programs, we think a lot about how to properly incent our client’s partners to sell more.  We have seen this produce intended (improved sales) and unintended (systemic cheating) outcomes.  Broadly speaking, generalized incentives are better than highly specific incentives when it comes to getting a constructive result.  Sure if you have to move one product by the end of the quarter and you don’t care about the long term effects – a specific incentive will do the job.  But if you want customers satisfied and loyal for the long term, working with partners to grow their business for the long term is better than quick hits.

Over incenting salespeople in technology might result in a consumer or company with an overly large hard disk or a bigger video card or a router with enough capacity for 10 years of growth.  Over incenting doctors might result in a generation of kids on Ritalin, parents on anti depressants, and in the worst case, deaths.  Here is more reading on the subject should you be interested:

 

 

Update one week later:  Great article in the NY Times today about the 3 million children on Ritalin -- and how there is not evidence that it helps!