How to Survive, Success & Sustain

in Healthcare Industry
Hermawan Kartajaya
President of MarkPlus, Inc. One of the 50 Gurus Who Have Shaped the Future of Marketing
(CIM United Kingdom)

About Hermawan Kartajaya

About Hermawan Kartajaya

Hermawan Kartajaya is widely known as one of the 50 Gurus who have shaped the future of marketing
Hermawan Kartajaya, a world class marketing modeler, has blended the latest marketing trend with a conceptual foundation. Philip Kotler S.C. Johnson & Son Distinguished Professor of International Marketing Kellogg School of Management

Hermawan Kartajaya is to Asian Marketing what Philip Kotler is to Global Marketing. Warren J. Keegan Lubin School Distinguished Professor of Business, Pace University
Most of what I know about Marketing, I learned from Hermawan Kartajaya. S. David Young Professor of Accounting & Control, INSEAD Author of EVA and Value Based Management

The Positioning of Hermawan Kartajaya in Marketing is unique. He is a combined product of Western Mind, Asia Heart and Indonesian Soul. Every company must get his advice. Al Ries Chairman, Ries & Ries

The Guru Gallery

(CHARTERED INSTITUTE OF MARKETING-UNITED KINGDOM)
David Aaker Tim Ambler Simon Anholt Michael J Baker Drayton Bird Stephen Brown Dave Chaffey Hugh Davidson Leslie De Chernatony Mark Earls Barry J Gibbons Malcolm Gladwell Seth Godin Dr. Evert Gummeson Gary Hamel Sam Hill John Philip Jones Steve Luengo-Jones Malcolm McDonald Regis McKenna Frederick Newell Kenichi Ohmae Stanley Paliwoda A. Parasuraman Don Peppers Tom Peters Nigel Piercy John Quelch Cees Van Riel Al Ries Martha Rogers Don E. Shultz Peter Senge Patricia B. Seybold Jagdish N. Sheth Rajendra Sisodia Merlin Stone David Taylor Jack Trout Hugh Wilson Yoram Wind Sergio Zyman

Hermawan Kartajaya
Bruce Kasanoff Philip J Kitchen Naomi Klien Ardi Kolah Philip Kotler Theodore Levitt Martin Lindstorm

http://www.shapetheagenda.com/ins/g_disp.cfm?choice=MAL&objectid=BB957F05-740B-418C-A25D31D6DBBE9817

About Hermawan Kartaj He is also the president of World Marketing Association

President, World Marketing Association (WMA), since 2002 President, Asia-Pacific Marketing Federation (APMF), 1998 2000 President, Indonesia Marketing Association (IMA), 1996-1999 and 1999-2002

He has co-authored several books together with Philip Kotler, About Hermawan the number one authority in the worldKartajaya of marketing
Translated into 21 non-English languages

CHANGE

COMPETITOR

4C
COMPANY

CUSTOMER

E-Payment Gateway Social Media for Work Mainstream Smartphone/Tablet

CONNECTED

Political Consensus for Stable Government ASEAN Leadership + East Asia Influence

Commitment for Development of Regional Autonomy Upgraded Status in G20: $3K GDP per capita + Investment Grade Urban Movement Middle Class Emergence YWN Supremacy

Proud to be Indonesian: Unity in Diversity BRIC+ CIVETS Mindset

CREDIBLE

CREATIVE

INDONESIA 2011: CONNECTED

Internet users

Internet Overal penetration

45
million s Average Internet Spend

Facebook users

Urban

19%

2nd
largest

31.3 %
Share of global tweets

~IDR 150K

3rd
largest

TEC H

E-Payment

Rakuten Belanja Online Diresmikan Tahun 2011

TEC H

Social Media for Work

TEC H

Mainstream Smartphone/Tablet

Ponsel QWERTY Pertama Nokia di bawah Rp 1 Juta

CONNECTED

Political Consensus for Stable Government ASEAN Leadership + East Asia Influence

Commitment for Development of Regional Autonomy Upgraded Status in G20: $3K GDP per capita + Investment Grade

Proud to be Indonesian: Unity in Diversity BRIC+ CIVETS Mindset

CREDIBLE

CREATIVE

INDONESIA 2011: CREDIBLE

#1 The Indonesian Tiger

POL LEG

Political Consensus for Stable Government

Sekretariat Gabungan Sampai 2014?

POL LEG

ASEAN Leadership + East Asia Influence

Marty Natalegawa: Bukan Chairmanship tapi Leadership!

ECO

Commitment for Regional Autonomy

Solo Menargetkan 2 juta Wisatawan Tiap Tahun

www.desaingrafis.com

ECO

USD 3K GDP Per Capita

2011

GDP per capita

USD 3K

2014

GDP per capita

USD 5K

ECO

Investment Grade

S&P Fitch Moody s

JCR

SOC CUL

Proud to be Indonesian

Unity in Diversity

SOC CUL

Indonesia with BRIC Characters

PRODUCTIVE

ENTREPRE NEURIAL

SMART LIFESTYLEORIENTED

CONNECTED

CREDIBLE

Urban Movement Middle Class Emergence YWN Supremacy

CREATIVE

INDONESIA 2011: CREATIVE

Urban
Middle Class

MORE CREATIVE THAN

Rural
Lower Class
Senior, Men, Citizen

YWN

MAR

Urban Movement

Rural Urban 48 52

Rural 32 Urban 68

MAR

Middle Class Emergence

Mar

YWN Supremacy

42 %
Youth are innovator/early adopters of new products

84 %
Women manage household budgets

40 %
Netizens involve in conversation on products

E-Payment Gateway Social Media for Work Mainstream Smartphone/Tablet

CONNECTED

Political Consensus for Stable Government ASEAN Leadership + East Asia Influence

Commitment for Development of Regional Autonomy Upgraded Status in G20: $3K GDP per capita + Investment Grade Urban Movement Middle Class Emergence YWN Supremacy

Proud to be Indonesian: Unity in Diversity BRIC+ CIVETS Mindset

CREDIBLE

CREATIVE

THE ENTRANCE: 3C
E-Payment Gateway Social Media for Work Mainstream Smartphone/Tablet

CONNECTED

Political Consensus for Stable Government ASEAN Leadership + East Asia Influence

Commitment for Development of Regional Autonomy Upgraded Status in G20: $3K GDP per capita + Investment Grade

Proud to be Indonesian: Unity in Diversity BRIC+ CIVETS Mindset

CREDIBLE

Urban Movement Middle Class Emergence YWN Supremacy

CREATIVE

THE PATH: 3S
Survival Strategy (Building the Foundation) Success Strategy (Setting Up the Pillars) Sustainability Strategy (Defending Home Market)

THE STRATEGIC IMPERATIVES

Y2K
3rd Millennium 2011

1
Success Strategy (Setting Up the Pillars)

1
2012-2015

Survival Strategy (Building the Foundation)

Sustainability Strategy (Defending Home Market)

Customer Management

Segmentation Targeting Positioning

1) YWN Subcultures 2) Digital Interactivity 3) Urban Lifestyle

YWN Networks Digital Platform Urban Homequarters

Product Management

Differentiation Marketing Mix Selling

4) Local Content & Context 5) Channel Mobility 6) Affordable Luxury

Local Authenticity Channel Accessibility Progressive Offering

Brand Management

Brand Service Process

7) Identity Personification 8) Proactive Engagement 9) Shared Resources

Trusted Identity Intimate Relationship Integrated Organization

The Exit: 3R

9 CORE ELEMENTS OF MARKETING

Customer Product Brand - Management

CUSTOMER MANAGEMENT

PRODUCT MANAGEMENT

BRAND MANAGEMENT

Customer Management
Fokus pada segmen tertentu untuk memperbesar basis pelanggan
High

Grow The Patient Base

Current Economic Contribution

Lock in Refferals

Take no action Subsidized Increase Refferals

Low Low Potential Economic Contribution High

Product Management
Fokus pada pengembangan kompetensi tertentu sebagai keunggulan bersaing

Brand Management
Fokus pada pengembangan brand melalui service dan process

QUALITY PROCESS

COST

DELIVERY

Positioning Differentiation Branding (PDB)

Brand Integrity

POSITIONING
Being Strategy

DIFFERENTIATION
Core Tactic

BRAND
Value Indicator

PDB: Mount Elizabeth

POSITIONING
BRAND INTEGRITY
DIFFERENTIATION Content (What to Offer)

Rumah sakit dengan pelayanan dan fasilitas terbaik

Spesialis dalam bidang bedah jantung dan syaraf Pelayanan tenaga medis yang memuaskan Letak yang strategis di dekat Orchid Road Manajemen rumah sakit terbaik (Asian Management Award)

Context (How to Offer)

BRAND

PDB: Bumrungrad International

BRAND INTEGRITY

POSITIONING

DIFFERENTIATION
Content (What to Offer)

Rumah Sakit berskala internasional dengan biaya relatif terjangkau

Fasilitas diagnosa state-of-the-art, therapeutic dan perawatan intensif pada layanan one stop service dengan harga terjangkau.

Context (How to Offer) Mendapatkan pengobatan berkualitas tanpa merasa berada di rumah sakit

BRAND

FOCUS ON YWN SUBCULTURES

Influence Overall Market Through YWN Communities

FOCUS ON YWN SUBCULTURES

Influence Overall Market Through YWN Communities

FOCUS ON YWN SUBCULTURES

Influence Overall Market Through YWN Communities

PREPARE FOR DIGITAL INTERACTIVITY

Start Moving From Face-to-Face to Screen-to-Face

Promags AhlinyaLambung.com

PREPARE FOR DIGITAL INTERACTIVITY

Start Moving From Face-to-Face to Screen-to-Face

PROMOTE URBAN LIFESTYLE

Connect with Fashion, Entertainment and Socialization

PROMOTE URBAN LIFESTYLE

Connect with Fashion, Entertainment and Socialization

PROMOTE URBAN LIFESTYLE

Connect with Fashion, Entertainment and Socialization

USE LOCAL CONTENT AND CONTEXT Embed 5-senses stimuli that evoke nationalism

Blue Bird Berseragam Batik di Ulang Tahun ke-38

CONSIDER CHANNEL MOBILITY

Improve ease of access through new distribution points

Punya Carrefour, Chairul Tanjung Siapkan Trans Mart di 2011

OFFER AFFORDABLE LUXURY

Prune unnecessary features & focus on realizing aspiration

< Rp120 Juta, Akankah Honda Brio Diboyong ke Indonesia?

OFFER AFFORDABLE LUXURY

Prune unnecessary features & focus on realizing aspiration

Jaringan Tune Hotels di Indonesia (Bali)

OFFER AFFORDABLE LUXURY

Prune unnecessary features & focus on realizing aspiration

RSYB menjual rumah sakit dalam semangkuk bakso

IDENTITY PERSONIFICATION
Use realistic storytelling instead of hyperbolic claims

Biore Its Me Storytelling Competition

IDENTITY PERSONIFICATION
Use realistic storytelling instead of hyperbolic claims

Grow with Character Books

PROACTIVE ENGAGEMENT
Initiate customer relationship beyond complaint handling

Garuda Indonesia layani Visa On Board

PROACTIVE ENGAGEMENT
Initiate customer relationship beyond complaint handling

Jemput Bola Ala Jasa Raharja

SHARED RESOURCES
Build synergy within and create co-opetition in the industry

Co-Opetition oleh Bank-bank Syariah

SHARED RESOURCES
Build synergy within and create co-opetition in the industry

Sharing BTS Antar Sesama Operator Telekomunikasi

SHARED RESOURCES
Build synergy within and create co-opetition in the industry

2011, BI Sinkronisasi Jaringan ATM

Marketing 3.0

Mayo Clinic

Thank You

Extra Session:

Creating Value Through Integrating Marketing & Finance

INTEGRATING MARKETING & FINANCE

WHY WHAT

HOW

INTEGRATING MARKETING & FINANCE

Half the money I spend on advertising is wasted. The trouble is I dont know which half.
Lord Leverhulme Unilever

INTEGRATING MARKETING & FINANCE

Chief Executive Officer are growing impatient with marketing. They feel that they get accountability for their investments in finance, production, information technology, even purchasing, but dont know what their marketing spending is achieving

Source: strategy+business. Issue 37 Winter 2004

INTEGRATING MARKETING & FINANCE

WHY WHAT

HOW

INTEGRATING MARKETING & FINANCE The Compromise Effort

THE FIRST ERA - CONFLICT

Financers and Marketers Are ENEMIES

Marketers are asking bigger budget for bigger marketing exposure

Financers are cutting budget for cost reduction to increase the bottom line

INTEGRATING MARKETING & FINANCE

THE SECOND ERA - COMPROMISE

Financers and Marketers Are FRIENDS

Financers are trying to understand marketers

Marketers are trying to learn financial knowledge

Marketing for Non-Marketers

Finance for NonFinancers

INTEGRATING MARKETING & FINANCE

WHY WHAT
HOW

INTEGRATING MARKETING & FINANCE The Compromise Effort

The Compromise Effort

Marketers Learn The Finance Term

Financial statements, principally consists of:

1.Balance Sheet
2.Income Statement

3.Cash Flow Statement

Source: Robert C. Higgins (2001) Analysis for Financial Management-6th edition

INTEGRATING MARKETING & FINANCE The Compromise Effort

The Balance Sheet

The basic relationship is:

Assets = Liabilities + Shareholders Equity

Source: Robert C. Higgins (2001) Analysis for Financial Management-6th edition

INTEGRATING MARKETING & FINANCE The Compromise Effort

Figure 2 The Timberland Company, Balance Sheets ($ million)

The Balance Sheet (contd)

December 31 1997 1998 Change in Account

Assets Cash and marketable Accounts receivable Inventories Prepaid expenses and other current assets Total current assets Property, plant, and equipment Less accumulated depreciation and amortization Net property, plant, and equipment Intangible assets Other assets Total assets Liabilities and Shareholder's Equity Accounts payable Wages payable Income taxes payable Other accrued expenses Total current liablities Long-term debt Deffered income taxes Total liabilities Common stock Additional paid-in-capital Retained earnings Less treasury stock Total shareholder's equity Total liabilities and shareholders' equity

98,8 $ 75,8 142,6 24,9 342,1 116,5 (63,6) 52,9 20,9 4,2 420,1

151,9 $ 79,0 131,2 25,4 387,5 131,2 (74,3) 56,9 19,2 5,8 469,4

53,1 3,2 (11,4) 0,5 14,7 (10,7) 4,0 (1,7) 1,6

20,4 $ 28,2 17,7 32,8 99,1 100,0 6,0 205,1 0,1 68,6 146,3 -0,1 214,9 420,0

25,9 $ 22,1 18,2 29,5 95,7 100 7,5 203,2 0,1 74,7 207,7 -16,3 266,2 469,4

5,5 (6,1) 0,5 (3,3)

1,5

51,3

Source: Robert C. Higgins (2001) Analysis for Financial Management-6th edition

INTEGRATING MARKETING & FINANCE The Compromise Effort

The Income Statement

The basic relationship is:

Net Sales

Cost of Goods Sold

Operating Expenses

Non Operating Expenses

Taxes

Earnings

Source: Robert C. Higgins (2001) Analysis for Financial Management-6th edition

INTEGRATING MARKETING & FINANCE The Compromise Effort

Figure 2 The Timberland Company, Income Statements ($ million)

The Income Statement (contd)

December 31 1997 1998

Net sales Cost of sales Gross profit Selling expenses General and aministrative expenses Depreciation and amortization Amortization of goodwill Total operating expenses Operating income Interest expense Other expense (income) Total non-operating expenses Income before income taxes Provision for income taxes Net Income
Source: Robert C. Higgins (2001) Analysis for Financial Management-6th edition

796,5 $ 464,2 332,3 174,7 51,7 20,3 1,7 248,4 83,9 14,8 1,4 16,2 67,7 20,3 47,4 $

862,2 501,1 361,1 195,7 50,9 18,2 1,7 266,5 94,6 9,5 (1,9) 7,6 87,0 27,8 59,2

INTEGRATING MARKETING & FINANCE The Compromise Effort

The Cash Flow-Production Cycle

Cash
Collection of Receivables Credit sales Cash Sales

Accounts Receivable
Production

Inventory
Depreciation

Investment

Fixed Assets

Source: Robert C. Higgins (2001) Analysis for Financial Management-6th edition

INTEGRATING MARKETING & FINANCE The Compromise Effort

THE SECOND ERA - COMPROMISE

The Cash Flow Statement

Basically, a cash flow statement simply expands and rearranges the sources and uses statement, placing each source or use into one of three board categories.

The category classified as follows: 1. Cash flows from operating activities 2. Cash flows from investing activities 3. Cash flows from financing activities

INTEGRATING MARKETING & FINANCE The Compromise Effort

The Cash Flow Statement (contd)

($ Millions)

INTEGRATING MARKETING & FINANCE The Compromise Effort

DuPont Formula

R
S
Net Income Sales

X
X X

S
A
Sales Assets

X
X

A
E

R
E
ROE
Return on Equity

Assets_____ Shareholders equity

Profit margin

Assets turnover

Financial leverage

ROA (Return on Assets)

INTEGRATING MARKETING & FINANCE The Compromise Effort

THE SECOND ERA - COMPROMISE

DuPont Formula

Shows the interrelationship between five key financial ratios: 1. 2. 3. 4. 5. Profit margin Asset turnover Return on Assets (ROA) Financial leverage Return on Equity (ROE)

INTEGRATING MARKETING & FINANCE The Compromise Effort

THE SECOND ERA - COMPROMISE

Economic profits

Economic Income versus Accounting Income Accountant Operating income Interest expense Other nonoperating expenses (income) Cost of equity Income before tax Provision for taxes Accounting earnings Economic earnings $ 94,6 9,5 -1,9 87,0 27,8 59,2 $ Econonomist $ 94,6 9,5 -1,9 31,9 55,1 27,8 27,3

INTEGRATING MARKETING & FINANCE

Thank You