Business Lessons From Diaspora: Steven Collis, CEO AmerisourceBergen

Steve Collis

VENTURES AFRICA – South African Steven Collis, who became Chief Executive Officer of AmerisourceBergen Corporation in July 2011, took home $4.6 million in compensation last year. Prior to that, he was President and Chief Operating Officer. Though not many people, even in the United States, have heard of drug wholesaler AmerisourceBergen, the company had $80.2 billion in revenue in the last fiscal year and is 29th on the Fortune 500 list. Headquartered in Valley Forge, Pennsylvania, it accounts for 20 percent of pharmaceuticals sold and distributed in the US. The company also employs 13,000 people with locations around the world. Tom Jackson looks at five lessons from Collis’ successful enterprise in America.

Do something well, but do quietly

Not many people have heard of the company, but Collis believes that this demonstrates that the company is doing its job correctly. AmerisourceBergen ships 25 percent of the top line drugs in the United States to over 20,000 customers each day, yet the company has name has not penetrated into the American consciousness. Collis likes it that way.

“We are a behind-the-scenes company, so consumers will not be aware of us, nor should they if we are doing our job right,” he says. “When I was buying a house, the people I was buying it from asked if I was sure I could afford the house. I said, “Yes, I’m the chief operating officer for AmerisourceBergen.” They said, “Well, who are they?” I said, “We are the largest revenue company in Pennsylvania.” They said, “No, you’re not.””

Soft franchising

AmerisourceBergen’s Good Neighbor Pharmacy programme is essentially a soft franchising company, which individual pharmacies sign up for to help them understand their patients. It provides a network, as well as a software programme which helps pharmacies understand why their patients are visiting and what other prescriptions they are getting. They also do advertising for those that sign up. This makes money for the company, but also creates a lot of goodwill in the market. AmerisourceBergen also recently announced the launch of the newly redesigned knowledgedriven.com, an educational website that provides practical content for the healthcare community.

“We’re very focused on helping community pharmacies survive and prosper,” says Collis. “We also have similar services in community oncology, where we have a very large practice as well.”

Bounce back. Bigger!

The company recently won a three-year contract, worth about $18.5 billion a year, to supply products to pharmacy benefits manager Express Scripts. This contract is critical because it replaces the proceeds from a contract with Medco Health Solutions that was lost when Express Scripts acquired it in April. The company has refused to be beaten and won a replacement contract very quickly.

“We are honoured that Express Scripts has chosen AmerisourceBergen to supply the brand pharmaceuticals it needs for its recently combined mail-order and specialty-pharmacy business,” said Collis.

Show leadership values

Collis believes that listening is key to good management, as is ensuring that staff have the same ethical makeup as the company itself.

“Some things I think are key and fundamental are respecting customers’ communication and respecting employee communication,” he says. “Listening to everyone. I like to listen rather than talk. I know what I know. I don’t know what the person sitting across from me knows. I’m a big believer in collaboration, giving people the benefit of the doubt and empowerment.

When it comes to hiring, he looks for “some of our core values – passion and integrity. We want people who have confidence, but are modest and not arrogant. Arrogance is a very dangerous thing when you have very important customers on both sides. When you sit down with a customer, you can get humbled pretty quickly when you understand their issues, the expectations and high standards, and knowing how cost conscious they are.”

Develop a world presence

AmerisourceBergen recently agreed to pay $520 million in cash to acquire World Courier Group Inc., a provider of transportation and logistics services to the biopharmaceutical industry. The acquisition will give the company a presence in more than 52 countries, with World Courier having over 137 offices across the world. AmerisourceBergen made a number of acquisitions last year that bolstered the services it can offer its customers. Most recently, it acquired CVS Caremark Corp.’s (CVS) TheraCom LLC unit, which provides support services to the biotechnology and pharmaceutical industries.

Collis said the addition of World Courier’s services “provides an established platform for the introduction of our specialty services outside North America.”