The flaw in Mayne is
their leadership model. Peter Smedley and Stuart James are
high-control, top-down, interventionist leaders who have built teams of
managers cut from the same cloth. In healthcare they are trying to
manage an industry that has traditionally operated by devolving
decision making down to the bedside.

In the Mayne
radiology/pathology business, decisions that relate to clinical issues
were (and are) being reviewed by commerce and business graduates in
Mayne’s St Kilda Road Melbourne head office.

The pharmaceutical
wholesale business Mayne acquired from Faulding relied on the goodwill
of the pharmacists who belonged to the Terry White, Chemmart,
Healthsense and Medicine Shoppe franchised marketing/buying groups.
Members of the groups would draw from the Mayne warehouses. Retail
pharmacists are a notoriously difficult group to control (likened by a
former CEO of Amcal to herding cats into a wheelbarrow). If the retail
pharmacists are to exhibit a modicum of loyalty to a pharmaceutical
wholesaler, they will do so because they belong to one of these groups,
believing that group membership is in their interest. Mayne has largely
driven them away. Hence you will see a proliferation of new groups.

physicians and surgeons who admitted patients to Mayne private
hospitals got to the point where they pretty much went on strike. What
is less well known is that in some Mayne hospitals, relationships
between St Kilda Road and the nursing staff resulted in so many
resignations that some hospitals were close to being unable to
successfully operate. There is a worldwide serious shortage of nursing
staff. Annoying nurses as a group is fatal. Having the nursing staff
believe that their decision making related to patient welfare will be
second guessed by headquarters is as good a way of annoying them off as

This will leave Mayne with a manufacturing business making
vitamins and the best shaving soap on the market. Manufacturing is a
sector that is used to being pushed around by the accountants in head
office. They should have stuck to logistics; where you can belt
truckies and warehouse people with a length of four by two and call it
management. However the rest of the world is learning that management
cultures like Mayne are flawed. They don’t work well now, and will work
less and less well in the future. Until Mayne, and quite a few others,
learn that leadership is about coaching and developing people, building
trust, painting a clear picture of the outcomes to be achieved (as
opposed to the tasks to be carried out) and inspiring action; they will
not maximise their potential. It’s no longer just about planning,
organising directing, controlling, policing and follow up.

Great managers are enlargers and enhancers, not punishers and straighteners.