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Mid Atlantic Medical Svcs (MME) Message Board

  • spadenator27 spadenator27 Aug 22, 2003 12:26 PM Flag

    Treatment of Sales People

    Why would senior management take away an incentive from Sales people that are performing in a tough environment???? They should have increased the incentives. I run a large sales force myself, I couldn't imagine doing something like this. Anyone think that the Anti sales stance they have taken is because they are going to abandon their direct sales approach and just really don't care about their Sales people? Any thoughts?

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    • I have been away a couple of weeks but I thought the original question was about developing an effective sales program. First sale rep. and management must establish an agree upon a realistic, achievable sales incentive program based not on revenue $ or volume but on profitable $ each rep. generates .
      (2) the sale rep.should get double credit for new profitable $s developed - this places emphasizes on new business. The profit $ approach forces both management and the sales force to focus on the more profiable product lines and the development of new business. I do hope MME's management is not nickel and dime-ing their sales force because they certainly took care of themselves in 1998 when the showed their interests by repricing options that were out of the money - that action was hard to believe as it is the most horrendous act any management could foster on its' stockholders.

    • There is a huge difference in M&A between entry into a market and the current business that company has. In most cases, a healthcare company finds it more difficult to obtain licensure and build a network (especially when you have no members with which to use as leverage for discounts) than to simply acquire an existing company. The NCPPO business was attractive because it had a decent physician network and very good hospital contracts given its current size - particularly its then deal with INOVA. That is why the business was attractive to WLP - not any existing business. Read WellPoint's 10-K - they concentrated on driving large employers out of the MM block because it was underpriced and they suffered significant losses. WellPoint wanted entry to the DC area - in particular the highly desirable and young/healthy growing IT/consulting market in NoVA.

      And if you want to go tit for tat - you claimed all these NCPPO accounts were non-risk arrangements. If that is the case - the financial return from these accounts would be very low.

    • First you state that law firms are bad business. But now your post says the reason for the MM purchase was because of the highly lucrative DC area much of which was law firms for MM -(They had about half of the top 25 by employee size and almost all the real big ones - Arnold and Porter, Williams and Connolly, Fried Frank, Crowell and Moring, Venable, etc.) So where do you stand? Are law firms bad business (original comment) or are they highly lucrative (most recent)?

      When Lincoln National was still in business they rented NCPPO for small groups. Principal was with Alliance.

    • First of all - WellPoint did know they had bought into NCPPO. Part of the reason for the MM deal was entry into what they thought was the highly lucrative DC region (also a reason for the CareFirst deal).

      Second - NCPPO is more than just a network leasing company. Check the stat filings for the company - also they are active in the Indiv/SmGrp market where a network leasing arrangement is not allowed.

    • This is probably just a sign that mgmt believes that Mamsi is reaching maturity in the market. Flooding the market with young incented salespeople is not what will keep growth moving. New territory is. Look for reductions in the marketing force to follow. Keeping business requires less time than getting it.

      In my opinion this is a mistake. I'd be looking for salespeople to go after markets Mamsi hasn't fully entered. The downtown law firms for instance are great business. Tens of thousands of lives Mamsi can't touch.

 

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