(gentle music)
Bob: Welcome everyone,
and thank you for joining our CEO Fireside Chat
on leading medtech during COVID and beyond.
I'm Bob Lavoie, a Senior Partner
and Managing Director at BCG.
I'm humbled and privileged to be hosting Geoff Martha,
the CEO of Medtronic with me today.
Geoff, welcome.
It's great to see you again, and thanks for being here
given everything you've got going on.
Geoff: Yeah, thanks Bob, I'm thrilled to be here.
Very excited to talk the pandemic,
especially as it has been going on for quite a while.
We've got lots of good things to share.
-: Well, we really appreciate you being here Geoff thank you.
First, let me start by commending you,
the Medtronic leadership team, and all the employees
for the incredible response
that you guys have all delivered regarding COVID.
I think ventilator production went up five times or so.
I think you've had to find some non-traditional partners
to help make that happen.
What was all that like in the moment?
-: In the moment it was intense.
I remember it was a Sunday afternoon in March
and I was trying to get some exercise in
and I made the mistake of keeping my phone next to me.
And it kept ringing, matter of fact,
it was bouncing across the table.
And getting calls from the White House,
from different heads of state,
of countries outside the United States,
a bunch of different governors.
Everybody was very concerned about ventilators,
they wanted to learn more and they want lots more of them.
And the spike in demand was orders of magnitude
over anything that the industry had ever provided
or could even comprehend.
And so that was a real important moment for the company.
We really rallied around this crisis,
and did a lot of things.
We went up to over 1,000 ventilators per month
out of our own manufacturing facilities.
And that took a lot of creativity
and a lot of, like I said,
blood, sweat, and tears, and courage.
Because these are factories
that when you're working seven days a week, 24/7,
you do run the risk of some COVID outbreaks.
And we've had some, and employees really did not
let those plants shut down for very long.
It was hours, and they were right back in there
after cleaning and really putting their own health
at a bit of risk here.
And we try to keep it as safe as possible
but they knew what this meant for the world.
And I just can't commend them enough,
I can't say enough great words about them.
And then our leadership recognizing the seriousness
of the moment and that it took a different bold action.
And we put one of our key ventilators online,
the one that we thought had the most impact,
potential impact, positive impact for this pandemic.
And we put those plans online, everything,
everything about the ventilator-thousands
and thousands of documents.
It took us like two, three days just
to load all the documents online
and gave out a royalty-free license for anybody
that wanted to either take this information
and run with it on your own, or partner with us.
And we had a couple of companies that did both.
We had over 250,000 people
and different entities download the documents.
And out of this, we had a couple of companies
that were able to just pick this up
and manufacture it themselves.
These are medical device companies.
We had one called Baylis Medical in Canada
that was really taking this on for the country of Canada.
We had other partners that were contract manufacturers
with very strong supply chain capabilities
that helped us overcome some of the supply constraints.
And are making these ventilators
for other parts of the world, like India and Bangladesh,
as well as here in the United States,
and making it for areas like Latin America.
And then we had another category of partners,
of more technology partners,
that helped us overcome technology problems.
Or in this case, opportunities where physicians reached out
and said, "We'd really like to have new functionality
on the ventilator so we can operate them remotely
and monitor patients remotely."
And so that entailed some technology changes, improvements,
and we partnered with companies like Intel and SpaceX.
And like I said, Elon Musk himself personally got involved
in these projects.
And it really was a testament to the human spirit as well.
These are engineers in these companies
that once they saw our plans online,
and on their own time, decided over the weekend
or at night or whenever to look at these drawings
and understand the product,
thought that they had the capabilities
at their respective companies to help.
And they reached out to us, both Intel and and SpaceX.
And here we are, they helped us solve major issues
or opportunities, and we've got new products
serving new patients because of it.
-: I know we've been speaking about the part
of the portfolio specific to and critical
to the COVID medical response, in the heat of the battle.
Now what about those elective procedures
that we've seen a shift in dynamics
between the patient-doctor approaches
given the nuances of working more remotely.
What are a few of the most critical lasting changes
that will have implications for Medtronic
and the medtech industry more broadly,
and how do you think global medtech companies need
to respond and adapt going forward
in order to be successful?
-: Well, I think there are some changes
that I think are here to stay as a result of COVID.
Anything that can be done, remote or virtual,
effectively, is preferred.
And I think we're learning that more things,
more activities than we previously had considered,
can be not just done remotely or virtually,
but done effectively.
And I think that technology provides that solution
and it's not just connectivity and 5G, and video,
things like Zoom like we're on today,
it's also the different product features
that medtech provides.
And cardiac rhythm is a good example,
plantable pacemakers, and defibrillators.
So that's what I mean, the technology,
whether it's the digital technologies, things like Zoom
and 5G, better connectivity,
but also the medtech products
are just different.
So that is one change that I believe is here to stay.
-: So in that context, what has this crisis shown you
about how you might adapt,
and what some of the big capabilities are
that you might need to work into the portfolio?
-: Well, I think a couple of things.
I mentioned earlier the ventilator experience,
it really for us has been profound,
and in a number of ways.
Beyond just when you really focus on something
that's critical, what you can do in a short period of time.
So there's the whole idea of focus,
and that's something I want to carry forward
for Medtronic, is to make sure we don't get caught
up and try to do everything,
and just focus on the critical things
we can really have a meaningful impact on.
But more specifically, I would say that the partnerships
that came out of this, to innovate,
I think there's a convergence.
We're in a time right now where technology
is moving so quickly.
And at medtech, we tend to be focused on really
a stable suite of technologies and the intersection
of those technologies and the physiology of the human body.
But now you're seeing the convergence
of digital technologies and the medtech as well
to help support the virtual piece of it.
And so that is something I think that...
so you hear about data and AI,
I think that's really going to change medtech,
we've really got to keep our eye on that.
In addition to that, just
the computational power that Silicon Valley is putting
out in their new products.
We need to think about how that's going to change medtech.
So, you know, lots of opportunity here.
And finally, I think the partnerships,
and partnerships with hospitals,
and partnerships with other companies
outside of medtech, outside of our industry.
So I do think in this new phase,
hospitals are looking for less vendors and more partners,
and there is a big difference
between a vendor and a partner.
And then the second is, I think medtech
companies really do need to look outside
of the medtech industry to learn some things.
Like I said, some of the digital capabilities
that are out there as well as some
of the supply chain capabilities
that we see in other industries,
whether it be the automotive industry which
I've learned a lot about over the last couple of weeks,
industries like that.
So lots to learn for us if we,
in some respects broaden our horizons,
but in other respects, laser-focus
on the things that really matter.
-: I'm taking away three things: focus,
supercharging tech in medtech,
so putting the tech back in medtech,
and using partnerships to get there.
How do you think the medtech industry
is going to have to respond going forward?
-: You know, you may not need
to have a 60-year-old mission for this.
I think companies just need to start playing bigger.
And look, it's all about attracting and retaining
and developing the right talent.
And I think part of a company's value proposition
for employees does have to extend beyond
providing them with salary and benefits,
but also providing them with a place
that they're proud to work
and is contributing to society in multiple ways.
-: I agree, Geoff, in fact, there's an old saying
that a company's response to crisis reveals a lot
about its leadership, its culture, and its people.
And if you take the current context today,
the social unrest that people have been dealing with,
the geopolitical uncertainty in the world,
the global pandemic, the US presidential elections,
that's a lot.
If you think about the increase
in cognitive load being experienced by everyone,
Medtronic colleagues included,
what insights have you been able to gain
in the last six months regarding corporate culture, values,
and specifically leadership, that might've come to light?
-: Well, look, you mentioned the mission
and like I mentioned earlier, it has these six tenets,
and it really is more than just words.
And one of the tenets, the sixth one, talks
about being a good corporate citizen.
And back in 1960, that wasn't a phrase.
Today that is a common phrase,
but back in 1960, this was not a common phrase.
And it's something that has permeated Medtronic's
culture all that time.
And really, in this time of crisis,
it really paid off where we focused on employees,
and especially during the social unrest,
as well as this pandemic, we really took a position.
A position of ... we were decisive
on where our priorities were,
and we took a position on social issues
and many companies have been hesitant
to weigh in on social issues.
And I'm not saying we can weigh in on every social issue,
but I do think in today's day and age,
companies need to play bigger than just business.
And that's what I think good
corporate citizenship really means.
-: Absolutely, we see it ourselves at BCG.
We work with a lot of companies
and we see this acknowledgement
that they just need to play bigger.
They need to play beyond just commerce,
to include social responsibility.
And we really appreciate
what Medtronic has done on that front.
You know, Earl's vision way back 60 years ago
was, I think, critical in setting that tone.
Back then it was only a glimmer
in a few folks' eyes,
and now it's core to how a lot of companies operate.
Geoff, I want to thank you again for your time today.
Appreciate your leadership,
the partnership with BCG over the years,
and certainly your time today.
-: Stay safe. -: Thank you.