PRACTICE PAPER

Systems marketing: A new

operating model for pharmaceutical
marketing
Received in revised form.

John Singer
is principal of Blue Spoon Consulting, a marketing architecture consultancy to the bio/
pharmaceutical, medical device, and consumer health industries. Prior to launching
Keywords: Blue Spoon in 2001, John held a variety senior strategic and brand management positions
Systems design,
at global healthcare marketing networks, including Publicis, Omnicom Group, and
adaptive tactical
Interpublic Group. He led positioning and communications strategy for the regulatory
systems,
approval of Lipitor (Pfizer), the pharmaceutical industry’s biggest selling medicine, and
progressive
directed the launch of one of the first patient compliance programs in drug marketing.
integration

Abstract
This paper introduces a new model for marketing based on systems design. Adaptive tactical
systems are featured as a novel commercial approach that enables ROI to be measured holistically,
and serves as a comprehensive strategy for progressive integration, accommodating new
marketing components, on-demand technologies, and business ideas as they emerge and are added
to the same containing whole. Initially applied to the pharmaceutical industry, the paper details
the design and evolution of a brand module, a tactical system focused specifically on harvesting
top-line sales from primary care brands in a middle market of the United States. Copyright #
2005 John Wiley & Sons, Ltd.

A NEW OPERATING ENVIRONMENT operational alignment and population

Towards the end of 2004, Procter &
Gamble announced a series of urgent
initiatives to find a new marketing
model. The news was not surprising.
Nearly every industry is struggling to
reinvent marketing in a way that
responds to exploding technological
innovation, product and service
John Singer
Principal
proliferation, stakeholder fragmentation,
Blue Spoon new government regulations and the
Consulting Group,
commoditisation of data. Systems
LLC, 701 Fourth
Avenue South, Suite thinking is considered to be a high-
500, Minneapolis, MN leverage frame of reference for its ability
55415. Tel:
612.337.9065 to change patterns of behaviour and
Fax: 612.338.0359 uncover fresh approaches to complex
e-mail: john@
bluespoonconsulting. problem situations; it is being applied to
com a diverse range of subject areas that are
URL: www.
bluespoonconsulting.
dynamically complex, including
com environmental change, economic policy,
health.
This paper provides a strategic context
within which pharmaceutical companies
can increase their marketing
competitiveness using a systems
approach. As the drug industry adapts its
activities to meet high rates of change in
the marketplace, it is imperative that a
new way of marketing guided by new
thinking is developed and systems
marketing responds to this need.
STRATEGIC CONTEXT
The marketing industry is passing
through one of the most disorientating
times in its history. Atomising customer
segments, an unrelenting flood of
product and service options, infinite
media channels, distribution and supply

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chain innovations, vendor
commoditisation and the onward march
of technological change have made
marketing more complex, more costly
and less effective for all industries. As
entire categories of businesses move
towards price, performance and tactical
parity between products, customers are
demanding new types of benefits that go
beyond functional attributes, which are
increasingly less differentiated. Shifts in
the broad mass of behaviour and
attitudes towards advertising are forcing
a fundamental rethink of the marketing
organisation, calling into question the
very ground rules, ordering principles
and belief systems that form the basis of
strategic planning. Yankelovich
identified a ‘socialization of marketing
resistance’, with consumers opting out in
ever greater numbers by ignoring
commercial radio and television and
hiding behind technologies that exempt
them from the onslaught of product
promotion (Walker Smith, 2003).
These are radically new business
dynamics. The speed with which they
have penetrated the US, Western
European and Japanese markets, their
scope and their dramatic impact on the
information environment are forcing an
explicit consideration of conventional
wisdom and questioning of what had
been traditionally in the background, ie
the invisible becoming visible
(Marketing Science Institute, 1989). The
implication means, among other things,
re-evaluating advertising-based
perspectives and the principles of
‘branding’ and ‘message’ as lead
elements within the marketing idea.
Everyone is looking for strategies to
lower marketing, sales and customer
interaction costs. The fact that major
marketers have begun consolidating
their budgets within advertising
holding companies is an important
shift in the ‘rule sets’ clients use to
purchase marketing services,
reflecting the underlying structural
transformation taking place in the
marketing industry.
Journal of Consumer Behaviour Vol. 4, 6, 480–495 Copyright # 2005 John Wiley & Sons, Ltd. 1472-0817
Systems marketing
Identical issues of marketing
creativity, productivity and
competitiveness confront the
pharmaceutical industry.
Pharmaceutical marketing operates in a
completely unique dimension, however,
with added layers of complexity and
more rapidly diminishing returns than
current business strategies.
Pharmaceutical companies are driven by
high investments and risks in clinical
research and development, a weakening
blockbuster model wed to creating
medicines that serve large patient
populations, intense competition,
multiple stakeholders responsible for
writing, approving, dispensing and
paying for prescriptions, more
marketing components and processes
deployed to reach and influence these
stakeholders, science and medicine as a
key element of product offerings, and
short periods of market exclusivity
before generic competition. The average
drug brand gives up 90 per cent of its
market share within six months of losing
patent protection. Pfizer is expected to
lose US$14bn in sales by 2007—nearly
one-third of its annual revenue—
because of patent expirations on some of
its biggest-selling drugs (Morningstar,
2005).
THE PHARMACEUTICAL MARKETING
SYSTEM
Pharmaceutical companies began
mass-market advertising in 1997 in the
USA after the Food and Drug
Administration (FDA) relaxed its rules
governing prescription drug advertising
to consumers. By the end of 2004, the
pharmaceutical industry had spent
US$4.1bn on DTC: direct-to-consumer
campaigns for the year, the fourth largest
category of consumer advertising,
surpassing motion pictures, credit card
services, computers, beer and apparel
categories (Nielsen Monitor-Plus, 2004).
The conspicuousness of this marketing
has caused side effects for drug
manufacturers, primarily from a
perceived link between advertising and
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John Singer
rising healthcare costs. A growing
number of states are putting restrictions
on the industry and enacting legislation
directly affecting marketing
practices—as of September 2004, five
states had laws or resolutions on their
books restricting drug promotion
activities, and more are following suit
(National Conference of State
Legislatures, 2005). California is now
debating a bill (AB95) that would require
drug companies to pay rebates equal to
the costs of marketing certain drugs in
the state. Senate Majority Leader Bill
Frist, a Republican, has called for a ban
on all DTC advertising during the first
two years in which a new drug is on the
market. On 10th January, 2005, Fortune
described the prior year as ‘one of the
most painful in the history of Big
Pharma’. Congressional investigations
into drug marketing practices, safety
issues and product recalls, pricing
pressure, more restrictive formularies,
full transparency in clinical trial
disclosure and closer regulatory scrutiny
for drug approvals and line extensions
have surfaced as critical business issues,
promising even more difficult times
ahead. The fact that return on investment
has never really been there for most DTC
advertising now seems almost secondary
(about 4 per cent of consumers say they
visit a doctor because of a prescription
drug advertisement (FDA, 2004)).
These uninspiring data and widening
legislative fallout from direct consumer
promotion of branded medicine are some
of the smaller, albeit more visible, plot
lines in the story of diminishing returns
across the spectrum of drug marketing
and sales activity. The pharmaceutical
industry’s sales force has grown by more
than 75 per cent in the past seven years, in
2004 reaching 94,000 detail
representatives on the streets who require
US$30bn annually to be maintained
(Pharmaceutical Executive, 2004). The
statistics around physician access are well
known. More than half of all detailing
never gets past the receptionist and
35 per cent of doctors are not seeing drug
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representatives at all. Of those details
which get through to a doctor, about
90 per cent are under two minutes in
duration, ie primarily a sample drop (The
Health Strategies Group, 1999). Free drug
samples distributed during these visits
were valued at US$16bn in 2003
(IMSHealth, 2003).
Noncompliance with medication is
another major issue. Revenue loss due to
unfilled prescriptions runs as high as
US$25bn a year (Datamonitor, 2003).
About 95 per cent of patient education
materials developed by drug companies
never get distributed to patients (McVea
and Venugopal, 2000). More than
80 per cent of all clinical trials are delayed
because of difficulty in recruiting
research volunteers. Depending on the
drug being studied, these delays can cost
pharmaceutical companies around
US$5m a day in lost sales (The Food and
Drug Letter, 2003). Delays can affect a
company’s valuation, as investors watch
closely the progress of new drug
candidates through the clinical
development process. Using marketing
techniques to improve patient
recruitment for clinical trials is
advocated (McKinsey & Co., Inc., 2002),
which is an interesting idea in light of the
constellation of issues facing marketing
discussed in this paper and bringing the
discussion back full circle.
REARRANGING MENTAL FURNITURE
The interdependency of so many problem
situations, their urgency and implications
for the future direction of two industries
(marketing and pharmaceuticals), and the
potentially endless operational and
contextual complexities in dealing with
them, present a mosaic of business
challenges that calls for an entirely
different conversation about the structure
of pharmaceutical marketing. This
conversation should expose deeply
rooted habits of thought and rearrange
one’s mental furniture about marketing
management. It should create conditions
to push marketing itself into a new
paradigm.

THE SYSTEMS CONCEPT
Systems theory is a different mode of
thinking based on the primacy of the
whole, principles of integration and
organised complexity. It focuses on
interrelationships rather than things,
identifying patterns of change instead of
static snapshots taken at a particular
moment in time and seeing the forest and
the trees (Senge, 1990). Systems thinking
opens interactions for examination. It is a
field whose lineage, and the emergence
of core systems concepts, can be traced to
parallel developments in biology,
behavioural sciences and control
engineering in the first half of the 20th
century. There are two main strands of
systems thinking—known as hard and
soft approaches—and how they are used
varies based on the individual styles of
systems practice.
The vision of a general systems theory
was first introduced in the late 1930s by
an Austrian biologist, Ludwig von
Bertalanffy. Rooted in his search for a
more holistic framework for studying
biology, and what he saw as the
increasing fragmentation of knowledge
at the time (decades before the internet),
Bertalanffy (1952) emphasised the
importance of analysing interactive
relationships and believed that certain
common principles apply to systems
irrespective of their nature. He defined a
system as a ‘complex of elements in
mutual interaction’ and believed that
physical, technological, biological and
social systems all shared structural and
functional similarities (Hammond,
2003). Bertalanffy linked his thinking to
advances in contemporary physics at the
time, and suggested that a systems
approach is basically a new attitude, a
new orientation towards ideas of
organisation, where the parts and
processes are ordered in light of the
development, maintenance and
evolution of the system. Bertalanffy
introduced the open-system concept that
emphasised an inflow and outflow
between the system and its environment.
In this sense, systems are ideal-seeking,
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Systems marketing
constantly evolving towards higher
levels of organisation and equilibrium
based on information received from
an external environment (Hammond,
2003).
At the turn of the century, two biologists
published their interactive view of natural
phenomena, and also introduced the
concepts of emergence and emergent
properties, in which the attributes of any
part in isolation are not the same as when
they are interacting with others in a whole.
In other words, the system creates its own
potential. This systems view also holds that
emergent properties are destroyed when
the system is dissected (Capra, 1996). The
rise of early computer technologies, and the
subsequent study of communication and
control between people and information
technology, gave birth to the field of
cybernetics in the 1950s, which was
considered a revolutionary concept at the
time. Cybernetics was primarily concerned
with circular forms of causality,
goal-seeking behaviour and studying the
importance of information and
communication in regulating external,
complex systems (Hammond, 2003).
SYSTEMS-BASED APPROACHES
The fields of operations research,
information theory and management
science arose in connection with the
Second World War, growing directly out
of the expansion of large-scale
engineering projects and using
scientifically-trained civilians in
planning complex military operations
that required close coordination between
components. Early applications included
developing anti-submarine tactics and
the synchronisation of radar and anti-
aircraft artillery during the Battle of
Britain (Checkland, 1999). In the period
after the Second World War,
considerable effort was made to apply
the lessons learned from wartime
operations research to industrial
companies and government agencies.
Systems analysis as a method of long-
range research and strategic thinking
was pioneered by the RAND
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John Singer
Corporation, a military research and
development institution concerned with
broad strategic and policy questions that
was founded in the late 1940s (Capra,
1996). All four branches of the US armed
forces currently use systems concepts for
teaching strategic planning, developing
doctrines and designing weapons
systems. The fact that marketing and
business today are often viewed in terms
of warfare and military thinking is worth
keeping in mind.
The idea of feedback was another
important development in
understanding systems. The sources of
the feedback concept have been traced to
six separate fields—mathematical
biology, econometrics, engineering, the
social sciences, the biology of
homeostasis and logic—that reach as far
back as Hippocrates and his holistic view
of medicine (Richardson, 1991).
Feedback helps in the understanding of
interrelationships between different
variables in complex systems. Jay
Forrester, whose influential work on
industrial and urban dynamics provided
the foundation for the system dynamics
group at Massachusetts Institute of
Technology, worked with formal
computer modelling techniques to
simulate the nonlinear dynamics of
feedback between variables. He inspired
broader analyses of behaviour in
systems, including Peter Senge’s work.
Senge extended the concepts of system
dynamics into five disciplines of
organisational learning, of which
systems thinking is the last discipline,
and his book The Fifth Discipline (Senge,
1990) has had a considerable impact on
management theory. The quantitative
computer modelling techniques of
systems dynamics are now considered to
form the ‘hard’ systems approach to
problem analysis.
‘Soft’ systems thinking takes the
systems idea in another direction. The
intellectual starting point for soft systems
thinking was in the UK in the 1960s,
based on the idea that an organisation
could be viewed as a system with
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functional subsystems. Shaped
following his consulting work applying
systems engineering to integrating
strategies (and British and French
cultures) around the supersonic
Concorde project, Checkland realised the
need for a systems-based approach to
solve problem situations which were not
technically defined and also considered
the complex systems in which human
beings play essential roles. Soft systems
methodology emerged as a way to
organise learning about complex,
confusing situations with an overall aim
of implementing change (Checkland,
1999). ‘Creative holism’ maximises the
value of various systems approaches by
using them creatively and in
combination (Jackson, 2003).
SYSTEMS MARKETING
Systems marketing is a new operating
model for marketing based on applying
general systems theory to marketing
pharmaceuticals in the USA. Systems
marketing accelerates the development of
new marketing capabilities. It defines
competitive strategy in a unique way and
serves as a creative platform from which
to design an infinite variety of enterprise
marketing solutions, communications
models and new business architectures
for all strategic and tactical levels within
an organisation. It addresses the semantic
problem, the technical problem and the
effectiveness problem of multiple levels of
marketing activity and multiple decision
makers within one framework.
Systems marketing is based on the
following assumptions.
— The reductionist, event-oriented
worldview that dominates current
marketing thinking is unable to cope
with the dynamic complexity and
instability of today’s information
environment.
— Marketing is that discipline
responsible for understanding and
managing the relations between the
organisation and its external
environment (Marketing Science

Institute, 1989). A major purpose of
information processing in marketing
is regulating interactions between
the organisation and the social
systems it serves.
— A system is a set of components that
work together for the overall
objective of the whole. These
components can be physical objects,
concepts, business activities,
organisational structures,
information-processing technologies
and performance measures.
— The system, subsystem and wider
system are relative, subjective terms.
Choice is made by the observer.
Systems are characterised by
boundaries, a hierarchical structure,
emergent properties,
communications and control.
Systems also can be designed to serve
other systems (Checkland, 1999).
— The primary role of brand
communications is to coordinate
behaviour. The intellectual and
creative energy behind persuasive
message and content planning should
be directed at designing social systems
and serving the needs of those systems
with an organisation’s information
assets. A secondary role for brand
communications is to increase the
value and capabilities of these systems
by maintaining the particular
configuration of their parts and the
relationships within their boundaries.
This is a dynamic strategy in which
marketing is used to evolve the
relationships between the parts and
keep them from falling into decay,
thereby ensuring collaboration
between systems (Laszlo, 1996).
— Component thinking is an element of
systems thinking; component-based
design is a technique to discover
those components whose measure of
effectiveness is truly related to the
performance of the overall system
(Churchman, 1968).
— Tactical systems are a new kind of
marketing tactic. Tactical systems
give brand managers a coherent,
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Systems marketing
continuous picture of their business
dynamics at the field level and are the
primary model used to measure
return-on-investment holistically.
— Competitive advantage goes to those
firms that do the best job of managing
the sequence of content flows
through tactical systems. The
meaning of these content flows is
incidental to decision making.
— Structure drives marketing strategy.
The emergent properties arising
from connecting components into
systems will create new ways to
design strategy and achieve
operational advantage.
— Everything is connected to
everything else. The implications of
this deceptively simple statement are
significant. Isolated measures of
component activity—studying the
performance of an individual
piece—are fundamentally flawed. In
light of the complexity of today’s
information environment,
traditional decision-making
processes to support sales forecasts,
sales force productivity, advertising
effectiveness, sampling demand or
resource allocation must evolve to
study whole system effects. In other
words, marketing effectiveness can
be understood accurately only within
the context of everything else.
Adaptive tactical systems
One core concept of systems marketing is
the adaptive tactical system. A tactical
system is a new operational framework
for brand management, a coordinating
mechanism which links a set of
marketing and sales components in a
way that actively generates synergy
among all its dimensions. Tactical
systems assume sales force components,
and their measure of effectiveness
should be a function of integration with
marketing components. Similarly,
tactical systems assume marketing
components, and their measure of
effectiveness should be a function of
integration with sales force components.
485
John Singer

Third
ENVIRONMENT progression

ENVIRONMENT
Second
progression

ENVIRONMENT
First
P progression F
(start)
R P U
O R F N
P After each iteration:
O F U
C R synthesise the C
C O information from the U
N
E E C N T
marketplace into a C C
S S
E
coherent image of the I
S T T
S S S whole, adapt planning, I
I O
implement subsequent O
N O N
progression
N

STRUCTURE

STRUCTURE

STRUCTURE

Figure 1: The complementary set of structure, function and process

Source: Gharajedaghi, 1999: 113 (reprinted with permission)

Emergent properties arise through the
integration and interaction of system
components. Rather than judging the
performance of individual pieces and
independent behaviour based on
fragmented data feeds, information that
can give detailed but isolated pictures of
what may or may not be working (ie a
false positive or a false negative), tactical
systems give a meaningful perception of
the whole by studying system effects. In
other words, the system is the tactic, the
thing that gets measured.
Tactical systems are designed. They
are inherently subjective,
entrepreneurial and creative, but
conceived in a way that synthesises
different functional groups,
organisational processes, components
and core technologies to form an output
module. Tactical systems are branded.
They become embedded in the
marketplace as corporate assets and are
dynamically managed through a process
which tries to ensure that the whole and
its parts are continually refined in cycles
of action (Checkland, 1999). Tactical
systems are adaptive. They sense and
respond to changes in the environment
and accommodate increasingly more
components (ie vendors) over time.
System design is a process of
progressive iterations and enquiries that
connects three distinct but interrelated
platforms—structure, function and
process—and evolves over time based
on feedback from the containing
environment (Gharajedaghi, 1999) (see
Figure 1). The environment makes up the
things and people that are fixed or given
from the system’s point of view
(Churchman, 1968).
ITERATIVE PROGRESSION OF SYSTEM
DESIGN
Theoretically, a system has no beginning
and no end, and any system configuration
has an unlimited number of properties, ie
there is a hierarchy of system complexity
(Checkland, 1999). The boundaries are

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defined by the focus of the designer.
System design begins with an idealised
perspective of what is hoped for; it is
assumed that an organisation can bring
the resources to bear and implement
change to achieve the vision for the
system. As listed below, there are three
interrelated platforms to system design,
making an iterative process which evolves
over time based on the system’s
interaction with its environment.
— Structure (inputs), where the
boundary of the system, the
components to integrate and the
relationship between components
are defined. A given structure can
produce several functions in the
same environment.
— Function, which defines the business
objectives and purpose of the system
and its outputs.
— Process, which defines the specific
sequence of activities and know-how
to produce the desired outcomes.
Structure, function and process
combined form the interdependent set of
variables that define the whole
(Gharajedaghi, 1999).
THE BRAND MODULE: AN ENTERPRISE
MARKETING SOLUTION
What follows summarises how systems
marketing can be applied to design a
brand module, which in this example is a
prototype tactical system for a primary
care drug nearing the end of its patent
life. The brand module is an example of
total system intervention (Jackson, 2003).
It connects three subsystems—a brand
communications system, a sales force
management system and a management
information system—into an enterprise
marketing solution whose main function
is efficiently harvesting new patient
starts (NRx (new prescriptions) top-line
growth) in Scottsdale, Arizona.
The brand module achieves total
awareness of marketing dynamics at the
field level. During the design stage,
assumptions about business strategy are
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Systems marketing
surfaced and evolved, redundancies
between the marketing plan and the
marketing environment are identified,
inputs and outputs are chosen, questions
about sales force effectiveness and right-
sizing are addressed, and the criteria for
measuring value based on whole system
effects are determined. Marketplace
auditing during the design stage will
identify layers and options in the
environment—formulary, timing and
regulatory considerations, collaborative
commerce channels, population health
initiatives, distribution networks
etc—that can become inputs for
model building and performance
measures.
The idea of progression is important.
Bertalanffy (1952) described the
following four principles that
characterise the process of differentiation
in living systems.
— Progressive integration, as the parts
become more dependent on the
whole;
— Progressive differentiation, as the
parts become more specialised;
— Progressive mechanisation, as the
parts become fixed to a single
function; and
— Increasing centralisation, as certain
parts gain predominance over the
others.
The business objectives for the brand
module, its structure, the range of
functions it can provide, as well as the
process involved to design and manage
its interaction with the environment,
evolve through progressions of
marketing integration. As the tactical
system becomes more deeply embedded
in the marketplace, and managed as a
corporate asset that can accommodate
increasingly more marketing
components and functions (harvesting
new sales and improving patient
compliance and driving recruitment for
clinical trials and negotiating formulary
advantage and optimising portfolio
management), the components
487
John Singer
themselves will evolve to specialised
roles supporting the tactical system, form
new subsystems and functions within
the wider system, and integrate with
other components in relationships that
were previously unforeseen. Slack in the
system, ie marketing waste and
inefficiency, will be identified and
removed in successive iterations.
Progression also provides a path that
an organisation can take, using a tactical
system as a first step, to align its
operations in a way that is in tune
culturally with its needs.
The first progression of marketing
integration
For the first progression of marketing
integration, the starting point is
identifying a unifying structural
component at the field level which, in this
case, is an abstract about a clinical study
of the drug to be presented at the Arizona
Geriatric Society Annual Meeting on 6th
November, 2005. The abstract has news
value for all print and broadcast media in
the state of Arizona, creating an
opportunity to connect a publicity
component to the data presentation.
Knowing the timeframe of the data
presentation and publicity output allows
consumer media buy to be directed
locally and pulsed in the same time
sequence. Satellite symposia can be
scheduled to reach all of the hospital and
health systems in the state around the
publicity and publication-plan activities.
Sampling can be synchronised to patient
inflow to physicians’ offices.
Longitudinal patient data can be
localised for Arizona and connected to
marketing components, and so on. All
marketing components are designed to
execute at the ‘push of a button’ within
the boundaries of the system. The intent
is to synchronise action and closely
couple content flows to prescribers and
consumers (see Figure 2).
Subordinate messages
Tactical systems introduce the idea of
subordinate messages as an emergent
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property. Rather than trying to repeat the
branding in as many different media
channels as possible, a tactical system
optimises message interactions between
components. Lipitor, for example, is
approved to lower cholesterol, which is
currently the primary benefit message
communicated for the drug in its
promotional content. Lipitor belongs to a
class of drugs called statins, however,
and the science of statins is rapidly
demonstrating great potential benefit for
this drug class for a range of conditions,
including osteoporosis, multiple
sclerosis and Alzheimer’s. There are
considerable differences in
pharmaceutical marketing between
what messages can be communicated
(using medical education components,
for example), what messages can be
communicated on behalf of an
organisation (using public relations
components) and what messages
can be communicated within the
context of approved brand labelling
(using consumer promotion
components).
Structure drives strategy. A tactical
system—and leveraging the property of
emergence within it—allows
consideration of multiple kinds of benefit
messages, brand and science, that can be
closely coupled and communicated
simultaneously. This element has
significant implications for strategic
planning, eg should the thrust of
business strategy for Lipitor focus on the
drug as a statin or as a cholesterol-
lowering agent?
Systems management:
Sense and respond
Some management theorists propose an
input–output approach to systems
management, using the view of a ‘black
box’ as a way of controlling systems. The
innards of the black box are less important
to understand because one is mainly
concerned with the inputs to the box so as
to maximise the quality of the outputs
(Churchman, 1968). Input and output
flows can be physical (eg materials or
 Systems marketing

NB: Subordinate message ¼ optimised message interactions

Figure 2: The first progression of marketing integration

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John Singer

money) or abstract (eg information or Marketing integration with sales

energy). The design process for the brand
module incorporates the ‘black box’
management concept to capture
communications feedback from the
environment, measure precise and
specific performance of the overall
system, and lay out an interactive type of
planning that can adapt to changes in the
environment (Checkland, 1999).
Integrating the brand module with
business intelligence components forms
the management information system.
New data sets are captured from the brand
module as it interacts with its
environment, analysed through a digital
dashboard (or business intelligence
portal), and then rapidly applied to evolve
the system and its functions. Marketing
performance management strategies are
based on calibrating the brand module via
this feedback, measuring the incremental
change from adding components to the
box, and synchronising their content flows
to the marketplace (see Figure 3). One can
envision an organisation using the brand
module as a way to evaluate vendor
services and their integrative
compatibility to the overall whole before
making long-term investment decisions
(ie on-demand contracting).
The second progression of marketing
integration focuses on synchronising the
brand module output with sales force
management. Pharmaceutical companies
gather considerable and increasingly
precise data about sales force effectiveness
and prescribing patterns using sales force
automation, customer-relationship
management, longitudinal patient
information and sampling management
components. Despite the richness of all
this available data, physician access and
sales force effectiveness remain a stubborn
problem.
The pharmaceutical industry’s
approach to addressing rapidly
diminishing returns from ever-larger
sales force investments has been to
isolate the problem as a sales force
operations issue, or to treat the sales force
problem with solutions the industry
already has. Off-the-shelf technology
applications that allow deep levels of
customer segmentation are driving
strategy recommendations based on
‘calling on the right doctor, with the right
message, the right number of times’
(Gharajedaghi, 1999). Alternatively,
Pfizer’s lead will be followed, and big
pharmaceutical companies will begin

Data warehouse

Data mart
Analytics/data mining tools
(predictive modelling)

Business
intelligence portal

New data sets

Brand module

John Singer, MD (Primary

Marketing resource
Care Physician in management
Scottsdale, AZ) (‘manage the box’)

Figure 3: Brand module communications feedback and control

490 Journal of Consumer Behaviour Vol. 4, 6, 480–495 Copyright # 2005 John Wiley & Sons, Ltd. 1472-0817
 Brand module

Synchronised brand
benefit message
John Singer, MD (Primary
Care Physician in Sales force (1)
Scottsdale, AZ)
+/-
Territory management Sampling
system dynamics
+/-
Patient base
Patient inflow
Prescriber
+/- dynamics Health information
Detailing needs
Contact rates
Prescribing dynamics Office dynamics Care management
change initiatives
Brand team
Access Prescribing Friends and family supplementation
Place dynamics supplementation

Patient
characteristics Advocacy group
Time allowed Health plan
+/- supplementation
supplementation
Detail sensitivity Decile
+/- Internet
supplementation
Formulary
status

Figure 4: Systems map

Journal of Consumer Behaviour Vol. 4, 6, 480–495 Copyright # 2005 John Wiley & Sons, Ltd. 1472-0817
491
Systems marketing
492
John Singer

Journal of Consumer Behaviour Vol. 4, 6, 480–495 Copyright # 2005 John Wiley & Sons, Ltd. 1472-0817
Figure 5: The brand module’s third progression of marketing integration
NB: Subordinate message ¼ message interactions

rolling back what has been described as a
sales force arms race.
Systems marketing assumes that the
meaning of a brand message (ie the drug’s
functional attributes) for many drugs is
incidental for decision making. This is
particularly true for primary care drugs,
where functional attributes, brand
imagery, creative programmes and
messages are often at parity with, if not
identical to, a competitor’s tactics for
drugs in the same class. Serving the
health information needs of the entire
office is also advocated as a ‘customer-
centric’ approach, although the extent to
which these information needs are
already served by the environment is
an overlooked dynamic. Systems
marketing methodology asks questions,
surfaces assumptions and defines
problems about key performance
indicators, sales force productivity and
right-sizing within the context of a wider
system, one that connects the output
from the brand module to interact with
the hierarchy of systems in territory
management.
A SYSTEM OF CONSUMER BEHAVIOUR
CHANGE
Stimulating a system creates a network of
effects—feedback and flows—at various
points throughout its structure.
Capturing and controlling the pattern of
these behaviour changes, and their rates
of change over time, enables a holistic
form of territory management that can
interface with current SFA (sales force
automation) and/or CRM (customer
relationship management) platforms.
Brand module (drug a)
January
Brand module (drug b)
Scottsdale, Arizona
Figure 6: The brand module’s tenth progression—Dynamic portfolio management (weekly, monthly,
quarterly)
Journal of Consumer Behaviour Vol. 4, 6, 480–495 Copyright # 2005 John Wiley & Sons, Ltd. 1472-0817
Systems marketing
In the systems map shown in Figure 4,
when the call plan is synchronised with
the output from the brand module,
different kinds of consumption
behaviour—ie demand by prescribers
for sales information, sampling demand,
patient/consumer inflow to the
prescriber’s office, decile change, calls by
consumers to the help desk, visits to
websites, script writing, script
dispensing—will take place (the þ/
)
throughout a hierarchy of subsystems.
These are the crucial strands of
connectivity. Each subsystem is its own
story to understand, learn from and
adapt to the larger whole. Analysing
subsystems will answer questions about
message strategy, operational alignment,
health information design, supply chain
coordination, performance measures,
business objectives, resource allocation
decisions and the linkages and
interactions between them. It also allows
systems to be reconfigured quickly based
on events in the marketplace.
AN EMBEDDED CORPORATE ASSET
One of the operating principles for
tactical system management is that it
becomes embedded in the marketplace
as a corporate asset. Evolved over time by
brand teams, tactical systems can
accomplish multiple functions
simultaneously, integrate more
components and processes around a
unified vision of strategy, achieve total
awareness of the local operating
environment, meet business objectives
more effectively and serve a greater
diversity of customer segments more
efficiently (See Figure 5).
Brand module (drug c)
December
Brand module (drug d)
493
John Singer
DYNAMIC PORTFOLIO MANAGEMENT
The idea of special-purpose modules
deployed in a series has been introduced
by others in the systems field. Each
special-purpose module has unique
behavioural characteristics and
performance measures that are
independent of the behaviour of other
peer modules in the platform (Jackson,
2003). Extending this concept to the
brand module creates a new approach to
pharmaceutical lifecycle planning and
portfolio management (see Figure 6).
SYNCHRONISED ACTION
Tactical systems achieve coordinated
changes in motivation, knowledge and
understanding that become more precise
and predictable with experience. Their
value to brand managers can be
summarised in the following points:
— The tactical system concept is an
‘inclusive’ approach to marketing
integration that emphasises the
benefits of incorporating the values
of all stakeholders in planning and
decision making (Churchman, 1968).
— Tactical systems are a complete vision
of marketing integration. They
provide new metaphors, orientations,
language and detailed models for
solving critical issues of marketing
and sales management in a complex
information environment.
— Tactical systems will create emergent
properties. Conventional
assumptions about strategy and
effectiveness based on isolated
assessments of components’
performance will shift to a different
mode of thinking based on holism.
Tactical systems open the door to
unlocking value from synchronising
message frequency with message
integrity, advertisement pulsing,
capturing message decay and
creating whole new categories of
process and service benefits bundled
with product offerings.
— Tactical systems are an example of an
asymmetric marketing tactic. They
494 Journal of Consumer Behaviour Vol. 4, 6, 480–495 Copyright # 2005 John Wiley & Sons, Ltd. 1472-0817
are a fundamentally new method of
marketing that could change the
nature of competition.
— Tactical systems are reproducible.
They can be deployed for all brands,
regardless of therapeutic category (or
industry).
MARKETING WITHIN THE CONTEXT OF
EVERYTHING ELSE
Systems thinking and ideas are still quite
rare in most organisations; the concept is
often construed to mean something
related to computers, which is an
obstacle to its broad adoption by front-
line managers. The systems approach,
however, is simply a different way of
understanding the world and going
about finding solutions to messy
problems. As the chaos of marketing
intensifies for all industries, as the pace of
change—technological, social, cultural
and environmental—accelerates
exponentially and as the institutions and
ideas that have guided people in the past
fail to solve systems of problems, a new
approach to manage the complexity of
marketing is called for. This paper
introduces systems marketing, a new
operating model for marketing with
practical applications for all industries. It
focused on adaptive tactical systems as a
coherent, actionable, real-world
pathway for the pharmaceutical industry
to reorient itself to the prevailing winds
of the future, and to begin marketing
within the context of everything else.
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