What Nairobi Women’s Hospital scandal teaches us about selling

“Nairobi Women’s Hospital scandal is reminiscent of Wells Fargo. Because all the greedy bank wanted was accounts, the salespeople went into survival mode, forging customer signatures.”

To begin with, what does Nairobi Women’s Hospital (NWH) have in common with Wells Fargo and Microsoft in the United States? Proof that when you run a business like a sales team, you are brewing a recipe for disaster.

The on-going serialization in the Sunday Nation about the scandal at Nairobi Women’s Hospital, shows that the institution focused more on meeting the set revenue targets, than addressing patient healthcare needs. How? By incentivizing clinical officers, via commissions, for prescribing unwarranted admissions and delayed discharges .

Further, the revenue, commissions, admissions and discharge numbers were (admirably, from a sales perspective) being actively monitored. Hourly, every day, day and night, by none other than the Chief Executive Officer (CEO) himself!

Nairobi Women’s Hospital scandal is like Wells Fargo’s

The hospital’s scandal is reminiscent of the Wells Fargo one. How? For five years until 2016, the American 160-plus year old bank fraudulently opened two million accounts through ‘cross-selling’ to its existing customers. Why? To meet impossible sales targets, intended to purposely inflate the bank’s share value and, therefore, executive bonuses!

Nairobi Women’s Hospital scandal

Interestingly, all this happened with the blessings of the board and executive. In fact, those who didn’t ‘shape up’ were ‘shipped out’. In November 2016, we wrote here about the scandal saying, “Because all the greedy bank wanted was accounts, irrespective of where they came from, the salespeople went into survival mode. Forging customer signatures, they proceeded to open two million accounts and put them down as ‘cross-sells’.”

What Nairobi Women’s Hospital scandal shares with Microsoft

In February of 2014, we said that, Turning sales people into CEO’s might not help firms.  This was after Steve Ballmer was replaced by Satya Nadella as Microsoft’s CEO.

Why? Business analysts and the several media have described Ballmer as: “The worst CEO of all time for a Fortune 500 company. During his time, Microsoft’s share value dropped by half! It went up by 8% on news of his retirement.

Surprisingly, that Ballmer was a successful salesperson is not in question. Why? (As Executive Vice President Sales and Support) Ballmer’s aggressive salesmanship during the boom days of the personal-computer industry exemplified how Microsoft became the world’s most valuable company. He also built one of the world’s most profitable and efficient sales and channel organizations.” 

What was the problem?

So what was the problem? “Steve Ballmer was regarded more as a salesman and cheerleader than a visionary. Microsoft’s employee base never really bought into Ballmer and whatever vision he had for the business; like many salespeople, he was seen as a bit too short-sighted.”

A business is not a sales team

Clearly, running a business as a sales team is a recipe for disaster. And yet, paradoxically, the success of both is measured from sales made. Alas! Sales may be the lifeline of a business, but it is not the business. 

Businesses, even those being fattened for sale like Nairobi Women’s Hospital, cannot focus purely on sales to grow. Selling a product calls for a narrow, short-term, specialist view. Leading a business calls for a broader, long-term, ‘generalist’ view. As enticing as it may seem, no company can survive on unfettered selling.

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2 thoughts on “What Nairobi Women’s Hospital scandal teaches us about selling

  1. Very true John. These are short lived strategies that do not take organization far. It is worth building an organization on strategies that support growth based on the market status. There should be more focus on enhancing competitive edge and selling customer value prepositions. It is unfortunate most organizations do not realize the shift in the game due to fourth industrial revolution ( continuous innovation) and still insist on traditional way of conducting a business. Ethics are also important. Well said.

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