[{"_1":2,"_3":-5,"_4":-5},"loaderData",{"_5":6,"_7":8},"actionData","errors","root",{"_137":-5,"_138":-5,"_139":140,"_141":142,"_143":144},"routes/clips.$id.$slug",{"_9":10,"_11":12},"clip",{"_13":14,"_15":16,"_17":-5,"_18":19,"_20":-5,"_21":22,"_23":24,"_25":26,"_27":28,"_29":30,"_31":32,"_33":34,"_35":36,"_37":38,"_39":40,"_41":-5,"_42":-5,"_43":-5,"_44":45,"_46":-5,"_47":48,"_49":50,"_51":-5},"canonicalUrl","https://howleaderslead.com/clips/2379/dont-solve-for-the-wrong-problem","id",2379,"title","Don’t solve for the wrong problem","subtitle","transcript","WEBVTT\n\n1\n00:00:00.000 --> 00:00:05.400\nI'll raise my hand. I've made the mistake that sometimes you see the problem in\n\n2\n00:00:05.400 --> 00:00:05.680\nfront of you,\n\n3\n00:00:05.680 --> 00:00:10.560\nand let's move quickly being action oriented. I've made the mistake sometimes\n\n4\n00:00:10.560 --> 00:00:11.600\nin terms of the\n\n5\n00:00:11.600 --> 00:00:17.300\ndesire to deal with or to solve whatever issue is on the table that everybody\n\n6\n00:00:17.300 --> 00:00:18.560\njumps in with both\n\n7\n00:00:18.560 --> 00:00:24.460\nfeet and you later realize you solved for the wrong problem. We talk a lot\n\n8\n00:00:24.460 --> 00:00:26.400\nabout, look, take a\n\n9\n00:00:26.400 --> 00:00:31.450\ndeep breath, take a few minutes and make sure that we understand the problem\n\n10\n00:00:31.450 --> 00:00:32.480\nthat we really need\n\n11\n00:00:32.480 --> 00:00:38.410\nto solve for. And then the second step is how do you define the guiding\n\n12\n00:00:38.410 --> 00:00:40.240\nprinciples in terms of\n\n13\n00:00:40.240 --> 00:00:44.900\ngoing about that? Because one of the things that I've come to appreciate, there\n\n14\n00:00:44.900 --> 00:00:45.840\nare so many things\n\n15\n00:00:45.840 --> 00:00:50.740\nthat come across our desk that perhaps the playbook has not been written and\n\n16\n00:00:50.740 --> 00:00:52.560\nyou're charting a new\n\n17\n00:00:52.560 --> 00:00:57.900\npath forward. That's especially true at CVS as we have worked to reinvent\n\n18\n00:00:57.900 --> 00:00:59.280\nourselves and change our\n\n19\n00:00:59.280 --> 00:01:04.330\nbusiness model to be more, not be more, be a health services company. And we\n\n20\n00:01:04.330 --> 00:01:05.600\nspend a lot of time,\n\n21\n00:01:05.600 --> 00:01:11.500\nwhat are the guiding principles that we will move forward to solve whatever is\n\n22\n00:01:11.500 --> 00:01:13.120\non the table? And we\n\n23\n00:01:13.120 --> 00:01:17.930\nuse those guiding principles as our guideposts, kind of our roadmap that as we\n\n24\n00:01:17.930 --> 00:01:19.280\n're dealing with the\n\n25\n00:01:19.280 --> 00:01:24.690\nthe unknown, I find myself oftentimes going back to those guiding principles\n\n26\n00:01:24.690 --> 00:01:25.520\nthen, how many of those\n\n27\n00:01:25.520 --> 00:01:32.090\ncan I check the box on? And if the answer is none, then that tells me I'm on\n\n28\n00:01:32.090 --> 00:01:33.680\nthe wrong road.\n\n29\n00:01:33.680 --> 00:01:37.500\nOkay, if the answer is no, you know what, I might not have checked every box,\n\n30\n00:01:37.500 --> 00:01:38.640\nbut I'm moving down the\n\n31\n00:01:38.640 --> 00:01:41.760\nright road and let's keep going. I love that idea.\n","pretty_transcript","start_time",527699,"end_time",626759,"keywords","mistake, problem, new path, guiding principles","slug","dont-solve-for-the-wrong-problem","origin","cms","mux_playback_id","02zImnv9CX029GavmrT3SoQoPznnC89dbpH02MIuWB01Lx00","mux_asset_id","0200WyZtrSY2YFJ4e02zgUsgaFnj8Dld00OgQm00SMrVrtK4","leader_id",128,"episode_id",276,"updated_at","2025-03-07T15:44:35.000000Z","meta_title","meta_description","og_image_media_id","web_url","https://www.howleaderslead.com/clips/2379/dont-solve-for-the-wrong-problem","og_image_url","leader",{"_13":36,"_101":102,"_103":104,"_105":106,"_25":107,"_108":109,"_62":110,"_59":110,"_111":112,"_69":113,"_39":114,"_115":-5,"_41":-5,"_42":-5,"_43":-5,"_116":117,"_89":118,"_44":119,"_120":121,"_122":123,"_46":-5,"_124":125,"_126":127,"_93":128,"_51":-5},"episode",{"_13":38,"_15":52,"_27":53,"_17":54,"_55":56,"_18":57,"_20":58,"_59":60,"_61":-5,"_62":60,"_63":-5,"_64":65,"_66":67,"_68":-5,"_69":-5,"_70":71,"_72":73,"_74":-5,"_35":36,"_39":75,"_41":-5,"_42":-5,"_43":-5,"_76":77,"_78":79,"_80":81,"_82":83,"_84":-5,"_85":-5,"_86":87,"_88":-5,"_89":-5,"_46":-5,"_90":91,"_92":-5,"_93":-5,"_51":-5},"og_image_media","Craft a Simple and Compelling Vision","craft-a-simple-and-compelling-vision","Learn how eight simple words transformed CVS Health – and unlocked a whole new level of revenue and growth. Plus, three clues to look for in your failures that indicate you’re actually on your way to success.","summary","

Today’s guest is Larry Merlo, CEO of CVS Health.

When Larry took the helm at CVS in 2011, they were doing about 100 billion dollars in revenue. That’s a lot of money. But guess what? Now they’re doing almost 250 billion in revenue. It’s a remarkable amount of growth.

But it’s not the most remarkable thing Larry has done. He also made the bold decision to remove tobacco products from CVS stores – even though they accounted for two billion dollars of revenue.

The story is incredible. But what’s even more incredible is why Larry and his team made that decision in the first place.

It came from a very simple statement of their purpose as a company. Literally eight words. And it changed everything for them.

As leaders, we all need to remember that the best vision in the world isn’t worth a thing if it doesn’t stick with people. This conversation with Larry shows us how to communicate our big ideas in simple, compelling terms.

That way, our team members can actually connect with it and apply it when they’re making their decisions each day.

You’ll also learn:

One thing Larry did early in his career that prepared him for the C-suite later on
How to know when it’s time to re-evaluate your organization’s vision
Why you may want to make it easy for your team members to fail – no, really
What to look for in customer feedback to help you identify consumer needs (and it’s probably not what you think)

Take your learning further. Get proven leadership advice from these (free!) resources:

The How Leaders Lead App: A vast library of 90-second leadership lessons to stay sharp on the go

Daily Insight Emails: One small (but powerful!) leadership principle to focus on each day

Whichever you choose, you can be sure you’ll get the trusted leadership advice you need to advance your career, develop your team, and grow your business.

","WEBVTT\n\n1\n00:00:00.000 --> 00:00:07.710\nWelcome to How Leaders Lead where every week you get to listen in while I\n\n2\n00:00:07.710 --> 00:00:08.520\ninterview some\n\n3\n00:00:08.520 --> 00:00:10.480\nof the very best leaders in the world.\n\n4\n00:00:10.480 --> 00:00:13.870\nI break down the key learning so that by the end of the episode, you'll have\n\n5\n00:00:13.870 --> 00:00:14.480\nsomething\n\n6\n00:00:14.480 --> 00:00:18.320\nsimple that you can apply as you develop into a better leader.\n\n7\n00:00:18.320 --> 00:00:21.040\nThat's what this podcast is all about.\n\n8\n00:00:21.040 --> 00:00:25.920\nAnd today's guest is Larry Merlow, CEO of CVS Health.\n\n9\n00:00:25.920 --> 00:00:30.850\nLarry is just an incredible leader and when he took the helm of CVS in 2011,\n\n10\n00:00:30.850 --> 00:00:31.520\nthey were\n\n11\n00:00:31.520 --> 00:00:35.000\ndoing about $100 billion in revenue.\n\n12\n00:00:35.000 --> 00:00:36.920\nNow that's a lot of money.\n\n13\n00:00:36.920 --> 00:00:38.160\nBut guess what?\n\n14\n00:00:38.160 --> 00:00:42.480\nNow they're doing almost $250 billion in revenue.\n\n15\n00:00:42.480 --> 00:00:45.520\nThat's just a remarkable level of growth.\n\n16\n00:00:45.520 --> 00:00:49.040\nBut it's not the most remarkable thing Larry has done.\n\n17\n00:00:49.040 --> 00:00:55.140\nHe also made the bold and honestly risky decision to remove tobacco products\n\n18\n00:00:55.140 --> 00:00:56.760\nfrom CVS stores.\n\n19\n00:00:56.760 --> 00:01:00.760\nAnd he did that even though they accounted for $2 billion of revenue.\n\n20\n00:01:00.760 --> 00:01:04.560\nHe'll tell you the whole story and it's incredible.\n\n21\n00:01:04.560 --> 00:01:08.420\nBut I really want you to listen for why he and his team made that decision in\n\n22\n00:01:08.420 --> 00:01:09.040\nthe first\n\n23\n00:01:09.040 --> 00:01:10.040\nplace.\n\n24\n00:01:10.040 --> 00:01:14.280\nIt came from a very simple statement of the purpose of their company.\n\n25\n00:01:14.280 --> 00:01:19.000\nLiterally eight words and it changed everything for them.\n\n26\n00:01:19.000 --> 00:01:23.810\nAs leaders, we all need the reminder, the best vision in the world ain't worth\n\n27\n00:01:23.810 --> 00:01:24.280\na lick\n\n28\n00:01:24.280 --> 00:01:28.680\nif our team can't connect with it and apply it each and every day.\n\n29\n00:01:28.680 --> 00:01:33.900\nThis conversation with Larry shows us just how to communicate our big ideas in\n\n30\n00:01:33.900 --> 00:01:34.440\nsimple\n\n31\n00:01:34.440 --> 00:01:36.280\ncompelling terms.\n\n32\n00:01:36.280 --> 00:01:46.100\nSo here's my conversation with my good friend and soon to be yours, Larry Mer\n\n33\n00:01:46.100 --> 00:01:47.120\nlow.\n\n34\n00:01:47.120 --> 00:01:50.040\nWell Larry, I appreciate you being on this show so much.\n\n35\n00:01:50.040 --> 00:01:51.040\nYou know what?\n\n36\n00:01:51.040 --> 00:01:54.240\nI've been looking at your career.\n\n37\n00:01:54.240 --> 00:01:57.160\nYou became CEO nine years ago.\n\n38\n00:01:57.160 --> 00:02:01.680\nAnd back then, CVS I think had a little over $100 billion in revenue.\n\n39\n00:02:01.680 --> 00:02:05.840\nAnd today it's $265 billion.\n\n40\n00:02:05.840 --> 00:02:12.950\nYou now have over 300,000 employees and you're number five on the Fortune 500\n\n41\n00:02:12.950 --> 00:02:13.640\nlist.\n\n42\n00:02:13.640 --> 00:02:17.160\nAnd to think, you started out as a pharmacist.\n\n43\n00:02:17.160 --> 00:02:19.000\nTell us about that journey.\n\n44\n00:02:19.000 --> 00:02:22.760\nWell David, it brings back a lot of memories.\n\n45\n00:02:22.760 --> 00:02:26.720\nI grew up in a small mill town.\n\n46\n00:02:26.720 --> 00:02:31.440\nThere was actually a Corning Glass Works plant that most people worked at.\n\n47\n00:02:31.440 --> 00:02:34.510\nAnd if they didn't work there, they worked at the Wheeling Pittsburgh Steel\n\n48\n00:02:34.510 --> 00:02:34.920\nplant across\n\n49\n00:02:34.920 --> 00:02:36.320\nthe river.\n\n50\n00:02:36.320 --> 00:02:37.720\nAnd I loved music.\n\n51\n00:02:37.720 --> 00:02:39.320\nI loved chemistry.\n\n52\n00:02:39.320 --> 00:02:44.040\nAnd I actually had a high school chemistry teacher that I think the world loved\n\n53\n00:02:44.040 --> 00:02:44.560\nto this\n\n54\n00:02:44.560 --> 00:02:45.560\nday.\n\n55\n00:02:45.560 --> 00:02:48.600\nAnd he actually steered me in the direction of pharmacy.\n\n56\n00:02:48.600 --> 00:02:53.400\nLarry, if you like chemistry and you like medicine, think about pharmacy as a\n\n57\n00:02:53.400 --> 00:02:54.200\ncareer.\n\n58\n00:02:54.200 --> 00:03:00.880\nAnd off I went to the University of Pittsburgh and five years later, graduated\n\n59\n00:03:00.880 --> 00:03:02.600\nas a pharmacist.\n\n60\n00:03:02.600 --> 00:03:05.800\nYou moved up the ladder from the pharmacist to CEO.\n\n61\n00:03:05.800 --> 00:03:09.560\nHow did you distinguish yourself and show that you had broader potential?\n\n62\n00:03:09.560 --> 00:03:11.120\nThat's a great question.\n\n63\n00:03:11.120 --> 00:03:14.160\nAnd oftentimes you get that question.\n\n64\n00:03:14.160 --> 00:03:18.400\nWell, when you start, did you have aspirations to be CEO?\n\n65\n00:03:18.400 --> 00:03:19.400\nAnd my answer was no.\n\n66\n00:03:19.400 --> 00:03:22.880\nI really had aspirations to be the very best pharmacist.\n\n67\n00:03:22.880 --> 00:03:27.080\nAnd as you got into that environment, you saw opportunities for growth.\n\n68\n00:03:27.080 --> 00:03:31.350\nAnd I had always set my goal in terms of, well, I went from being a pharmacist\n\n69\n00:03:31.350 --> 00:03:31.920\nto getting\n\n70\n00:03:31.920 --> 00:03:35.760\ninto management and field management and operations.\n\n71\n00:03:35.760 --> 00:03:41.250\nAnd I think one of the things that helped shape my learnings is that I was\n\n72\n00:03:41.250 --> 00:03:42.320\nnever afraid\n\n73\n00:03:42.320 --> 00:03:46.000\nto raise my hand for a special assignment.\n\n74\n00:03:46.000 --> 00:03:50.790\nAnd maybe it didn't result in a promotion, but it actually took me out of my\n\n75\n00:03:50.790 --> 00:03:51.480\ncomfort\n\n76\n00:03:51.480 --> 00:03:52.640\nzone.\n\n77\n00:03:52.640 --> 00:03:57.130\nAnd through the various experiences that I had, it actually taught me about\n\n78\n00:03:57.130 --> 00:03:57.720\nthings that\n\n79\n00:03:57.720 --> 00:04:02.360\nwere not core to my experience or my background.\n\n80\n00:04:02.360 --> 00:04:05.040\nAnd I think a lot about that.\n\n81\n00:04:05.040 --> 00:04:10.380\nAnd I think if I didn't have had those opportunities or took advantage of them,\n\n82\n00:04:10.380 --> 00:04:11.880\nI don't see myself\n\n83\n00:04:11.880 --> 00:04:14.120\nbeing in the role that I'm in today.\n\n84\n00:04:14.120 --> 00:04:17.390\nDid you have, Larry, when you were taking on those special assignments, did you\n\n85\n00:04:17.390 --> 00:04:17.680\nhave\n\n86\n00:04:17.680 --> 00:04:21.720\none of those that really sort of changed your career trajectory?\n\n87\n00:04:21.720 --> 00:04:25.850\nWhen I graduated from pharmacist, I went to work for a drug chain that many\n\n88\n00:04:25.850 --> 00:04:26.800\nwill remember\n\n89\n00:04:26.800 --> 00:04:29.280\nin the Washington, DC, or it called People's Drug.\n\n90\n00:04:29.280 --> 00:04:31.480\nIt was actually founded in 1904.\n\n91\n00:04:31.480 --> 00:04:36.040\nAnd this is now 1978 and had a wonderful experience there.\n\n92\n00:04:36.040 --> 00:04:40.760\nAnd 12 years later, the CVS actually acquired the People's Drug chain.\n\n93\n00:04:40.760 --> 00:04:42.680\nThat's how I got the CVS.\n\n94\n00:04:42.680 --> 00:04:48.460\nAnd through consolidation activities, which we can all appreciate, I found\n\n95\n00:04:48.460 --> 00:04:49.320\nmyself as the\n\n96\n00:04:49.320 --> 00:04:55.320\nmost senior person that remained in the Washington, DC area.\n\n97\n00:04:55.320 --> 00:05:02.360\nAnd that dynamic really helped shape, I would describe my leadership, because\n\n98\n00:05:02.360 --> 00:05:03.760\nnow I recognized\n\n99\n00:05:03.760 --> 00:05:06.720\nthat, okay, we were part of this new company.\n\n100\n00:05:06.720 --> 00:05:11.160\nThere were many things that CVS did differently than people's.\n\n101\n00:05:11.160 --> 00:05:15.890\nMany things that were very positive and some things that, this isn't going to\n\n102\n00:05:15.890 --> 00:05:16.480\nwork in the\n\n103\n00:05:16.480 --> 00:05:18.280\nwash to DC market.\n\n104\n00:05:18.280 --> 00:05:23.920\nAnd I found myself playing that role, that leadership role in terms of how do I\n\n105\n00:05:23.920 --> 00:05:25.520\nhelp educate my\n\n106\n00:05:25.520 --> 00:05:32.310\nboss and our new owners in terms of things that I think may be contradictory to\n\n107\n00:05:32.310 --> 00:05:32.560\nthat\n\n108\n00:05:32.560 --> 00:05:34.080\nparticular marketplace.\n\n109\n00:05:34.080 --> 00:05:40.880\nAnd it, at the same time, provide leadership four to time, about 10,000 of our\n\n110\n00:05:40.880 --> 00:05:42.200\nnew CVS colleagues\n\n111\n00:05:42.200 --> 00:05:47.500\nin terms of the leadership that they needed in terms of how are they going to\n\n112\n00:05:47.500 --> 00:05:48.240\naccept some\n\n113\n00:05:48.240 --> 00:05:52.970\nof the changes that we were all going to be better as a result of what we were\n\n114\n00:05:52.970 --> 00:05:53.920\ncollectively\n\n115\n00:05:53.920 --> 00:05:56.000\ndoing as a leadership team.\n\n116\n00:05:56.000 --> 00:05:58.760\nSo I learned an awful lot from that.\n\n117\n00:05:58.760 --> 00:06:02.240\nWell, you certainly have a company now that requires integration.\n\n118\n00:06:02.240 --> 00:06:03.920\nI want to get to that a little bit later.\n\n119\n00:06:03.920 --> 00:06:09.200\nBut I know you really think a lot about leadership, Larry.\n\n120\n00:06:09.200 --> 00:06:13.890\nCan you tell us a couple of stories about your personal guiding principles of\n\n121\n00:06:13.890 --> 00:06:14.880\nleadership?\n\n122\n00:06:14.880 --> 00:06:18.900\nBecause I understand that doing a little homework that you actually have 10\n\n123\n00:06:18.900 --> 00:06:19.920\nguiding principles.\n\n124\n00:06:19.920 --> 00:06:21.320\nWe don't have time for 10.\n\n125\n00:06:21.320 --> 00:06:24.680\nBut do you have a couple of stories on a few of the main ones that you could\n\n126\n00:06:24.680 --> 00:06:25.320\nshare with\n\n127\n00:06:25.320 --> 00:06:26.320\nus?\n\n128\n00:06:26.320 --> 00:06:27.320\nYeah.\n\n129\n00:06:27.320 --> 00:06:28.960\nAnd you brought up the 10.\n\n130\n00:06:28.960 --> 00:06:35.240\nAnd when I became CEO, that was back in early 2011.\n\n131\n00:06:35.240 --> 00:06:40.680\nAnd I still remember it was a Sunday night and I'm thinking a lot about how do\n\n132\n00:06:40.680 --> 00:06:41.160\nI get\n\n133\n00:06:41.160 --> 00:06:42.160\nstarted?\n\n134\n00:06:42.160 --> 00:06:46.740\nIt's an organization that I know and it's an organization that our colleagues\n\n135\n00:06:46.740 --> 00:06:47.160\nknow,\n\n136\n00:06:47.160 --> 00:06:48.600\nknow me and who I am.\n\n137\n00:06:48.600 --> 00:06:52.600\nBut obviously I was succeeding a very successful individual.\n\n138\n00:06:52.600 --> 00:06:57.330\nMy predecessor had been in that role for more than 15 years and was very well\n\n139\n00:06:57.330 --> 00:06:58.040\nrespected\n\n140\n00:06:58.040 --> 00:06:59.640\nacross the organization.\n\n141\n00:06:59.640 --> 00:07:06.280\nAnd how do I get our colleagues to see me in a different light as the CEO?\n\n142\n00:07:06.280 --> 00:07:10.080\nAnd that was the question that I was really wrestling with.\n\n143\n00:07:10.080 --> 00:07:14.250\nAnd I still remember that Sunday evening, just scribbling a whole bunch of\n\n144\n00:07:14.250 --> 00:07:15.520\nrandom thoughts.\n\n145\n00:07:15.520 --> 00:07:19.140\nAnd those thoughts ended up being 10 things that I believe in that I think have\n\n146\n00:07:19.140 --> 00:07:19.560\nhelped\n\n147\n00:07:19.560 --> 00:07:21.920\nshape me as a leader.\n\n148\n00:07:21.920 --> 00:07:28.550\nAnd David, one of those stories is I think about finding the sweet spot between\n\n149\n00:07:28.550 --> 00:07:29.040\nbeing\n\n150\n00:07:29.040 --> 00:07:32.080\na student and being a teacher.\n\n151\n00:07:32.080 --> 00:07:35.960\nAnd I think the higher you move up in any organization, I think there's an\n\n152\n00:07:35.960 --> 00:07:36.760\nexpectation\n\n153\n00:07:36.760 --> 00:07:39.320\nthat you have all the answers.\n\n154\n00:07:39.320 --> 00:07:42.560\nAnd the reality is as the CEO, you don't.\n\n155\n00:07:42.560 --> 00:07:47.280\nAnd I believe a strong leader takes pride in being both a student and a teacher\n\n156\n00:07:47.280 --> 00:07:47.560\n.\n\n157\n00:07:47.560 --> 00:07:51.040\nAnd being that student means that you're displaying humility.\n\n158\n00:07:51.040 --> 00:07:52.040\nOkay?\n\n159\n00:07:52.040 --> 00:07:56.040\nAnd at the same time, you're a good listener.\n\n160\n00:07:56.040 --> 00:08:00.600\nAnd it's something that I have really tried to stay true to.\n\n161\n00:08:00.600 --> 00:08:06.440\nAnd sometimes it's hard because in times of crisis, people do expect you, well,\n\n162\n00:08:06.440 --> 00:08:06.960\nLarry's\n\n163\n00:08:06.960 --> 00:08:08.600\ngoing to have the answer.\n\n164\n00:08:08.600 --> 00:08:11.480\nHe's going to know exactly what we need to do.\n\n165\n00:08:11.480 --> 00:08:15.600\nAnd there are times when you have to turn around and acknowledge that, look, I\n\n166\n00:08:15.600 --> 00:08:15.960\ndon't\n\n167\n00:08:15.960 --> 00:08:17.560\nhave the answer.\n\n168\n00:08:17.560 --> 00:08:19.320\nBut here's what we need to solve for.\n\n169\n00:08:19.320 --> 00:08:21.520\nAnd here's how we're going to go about doing that.\n\n170\n00:08:21.520 --> 00:08:26.280\nAnd I have found that that guiding principle has served me and I believe served\n\n171\n00:08:26.280 --> 00:08:27.440\nour organization\n\n172\n00:08:27.440 --> 00:08:28.440\nvery well.\n\n173\n00:08:28.440 --> 00:08:29.440\nThat's fantastic.\n\n174\n00:08:29.440 --> 00:08:30.440\nI just love it.\n\n175\n00:08:30.440 --> 00:08:33.320\nI love the fact that you codified your 10 principles too.\n\n176\n00:08:33.320 --> 00:08:36.960\nThe student as teacher is a way how you can solve problems.\n\n177\n00:08:36.960 --> 00:08:41.480\nHow do you take your team through solving a major problem?\n\n178\n00:08:41.480 --> 00:08:43.920\nWhat's your perspective on problem solving?\n\n179\n00:08:43.920 --> 00:08:47.760\nI think oftentimes in look, I'll raise my hand.\n\n180\n00:08:47.760 --> 00:08:52.000\nI've made the mistake that sometimes you see the problem in front of you and\n\n181\n00:08:52.000 --> 00:08:52.680\nlet's move\n\n182\n00:08:52.680 --> 00:08:55.000\nquickly being action oriented.\n\n183\n00:08:55.000 --> 00:08:59.940\nAnd I've made the mistake sometimes in terms of the desire to deal with or to\n\n184\n00:08:59.940 --> 00:09:01.000\nsolve whatever\n\n185\n00:09:01.000 --> 00:09:06.570\nissue is on the table that everybody jumps in with both feet and you later\n\n186\n00:09:06.570 --> 00:09:07.600\nrealize you\n\n187\n00:09:07.600 --> 00:09:09.680\nsolved for the wrong problem.\n\n188\n00:09:09.680 --> 00:09:15.700\nAnd we talk a lot about, look, take a deep breath, take a few minutes and make\n\n189\n00:09:15.700 --> 00:09:16.400\nsure that\n\n190\n00:09:16.400 --> 00:09:20.400\nwe understand the problem that we really need to solve for.\n\n191\n00:09:20.400 --> 00:09:25.860\nAnd then the second step is how do you define the guiding principles in terms\n\n192\n00:09:25.860 --> 00:09:27.040\nof going about\n\n193\n00:09:27.040 --> 00:09:28.040\nthat?\n\n194\n00:09:28.040 --> 00:09:31.460\nBecause one of the things that I've come to appreciate, there are so many\n\n195\n00:09:31.460 --> 00:09:32.120\nthings that\n\n196\n00:09:32.120 --> 00:09:37.190\ncome across our desk that perhaps the playbook has not been written and you're\n\n197\n00:09:37.190 --> 00:09:37.880\ncharting a\n\n198\n00:09:37.880 --> 00:09:39.840\nnew path forward.\n\n199\n00:09:39.840 --> 00:09:44.510\nThat's especially true at CVS as we have worked to reinvent ourselves and\n\n200\n00:09:44.510 --> 00:09:45.720\nchange our business\n\n201\n00:09:45.720 --> 00:09:50.400\nmodel to be more, not be more, be a health services company.\n\n202\n00:09:50.400 --> 00:09:55.530\nAnd we spend a lot of time, what are the guiding principles that we will move\n\n203\n00:09:55.530 --> 00:09:57.000\nforward to solve\n\n204\n00:09:57.000 --> 00:09:59.240\nwhatever is on the table?\n\n205\n00:09:59.240 --> 00:10:03.940\nAnd we use those guiding principles as our guideposts, kind of our roadmap that\n\n206\n00:10:03.940 --> 00:10:04.520\nas we're\n\n207\n00:10:04.520 --> 00:10:09.630\ndealing with the unknown, I find myself oftentimes going back to those guiding\n\n208\n00:10:09.630 --> 00:10:10.920\nprinciples then\n\n209\n00:10:10.920 --> 00:10:13.640\nhow many of those can I check the box on?\n\n210\n00:10:13.640 --> 00:10:20.240\nAnd if the answer is none, then that tells me I'm on the wrong road.\n\n211\n00:10:20.240 --> 00:10:24.290\nIf the answer is no, I might not have checked every box, but I'm moving down\n\n212\n00:10:24.290 --> 00:10:24.880\nthe right\n\n213\n00:10:24.880 --> 00:10:26.840\nroad and let's keep going.\n\n214\n00:10:26.840 --> 00:10:30.600\nI love that idea of taking a deep breath.\n\n215\n00:10:30.600 --> 00:10:33.860\nThere's so many times I could tell you when I just went charging ahead and\n\n216\n00:10:33.860 --> 00:10:34.520\nneeded to take\n\n217\n00:10:34.520 --> 00:10:36.400\na little bit of a time out.\n\n218\n00:10:36.400 --> 00:10:42.000\nWhen you became a CEO, a lot of us, we get into these new jobs.\n\n219\n00:10:42.000 --> 00:10:48.690\nWhat was the biggest anxiety you had to work through when you became the new\n\n220\n00:10:48.690 --> 00:10:49.320\nCEO?\n\n221\n00:10:49.320 --> 00:10:55.260\nI think one of the things that we wrestled with, and some of this goes back to\n\n222\n00:10:55.260 --> 00:10:55.840\nwhat we\n\n223\n00:10:55.840 --> 00:11:00.720\nwere just talking about in terms of our evolving strategy as a health services\n\n224\n00:11:00.720 --> 00:11:01.560\ncompany.\n\n225\n00:11:01.560 --> 00:11:07.680\nI remember sitting down and looking at at the time, we had our mission\n\n226\n00:11:07.680 --> 00:11:08.800\nstatement and\n\n227\n00:11:08.800 --> 00:11:10.720\nour vision statement.\n\n228\n00:11:10.720 --> 00:11:16.600\nI think back on that, we made the mistake of involving the consultants.\n\n229\n00:11:16.600 --> 00:11:22.560\nLook, there are times where consultants are invaluable and there are times\n\n230\n00:11:22.560 --> 00:11:23.240\nwhere you don't\n\n231\n00:11:23.240 --> 00:11:27.100\nneed a consultant and if you're going to do it right, you need to do it from\n\n232\n00:11:27.100 --> 00:11:27.720\nwithin.\n\n233\n00:11:27.720 --> 00:11:31.840\nWe had these very carefully worded paragraphs.\n\n234\n00:11:31.840 --> 00:11:35.720\nWhen you read them, it felt like we were solving for world hunger.\n\n235\n00:11:35.720 --> 00:11:40.880\nI could remember one of the very first leadership meetings that we had.\n\n236\n00:11:40.880 --> 00:11:46.520\nWe had about 400 people in the room and I put up the two paragraphs.\n\n237\n00:11:46.520 --> 00:11:49.640\nI asked everyone, which one is the mission?\n\n238\n00:11:49.640 --> 00:11:51.400\nWhich one is the vision?\n\n239\n00:11:51.400 --> 00:11:54.400\nYou got a 50% chance of getting it right.\n\n240\n00:11:54.400 --> 00:12:01.560\nBack then, we were using our phones to do the question.\n\n241\n00:12:01.560 --> 00:12:03.080\nThat's exactly what we got.\n\n242\n00:12:03.080 --> 00:12:07.240\n50% of the people got it right.\n\n243\n00:12:07.240 --> 00:12:10.670\nI still remember in that meeting making a commitment that, \"Look, this is the\n\n244\n00:12:10.670 --> 00:12:11.160\nlast time\n\n245\n00:12:11.160 --> 00:12:15.480\nyou're going to see this mission and this vision because we haven't been able\n\n246\n00:12:15.480 --> 00:12:16.720\nto operationalize\n\n247\n00:12:16.720 --> 00:12:23.120\nit in terms of bringing a day-to-day meaning to our work.\"\n\n248\n00:12:23.120 --> 00:12:26.840\nIf we can't answer that question as the leadership of the company, then how\n\n249\n00:12:26.840 --> 00:12:27.800\ngood a job are we\n\n250\n00:12:27.800 --> 00:12:33.220\ndoing leading the thousands of individuals that are counting on us for that\n\n251\n00:12:33.220 --> 00:12:34.280\nlevel of leadership\n\n252\n00:12:34.280 --> 00:12:36.120\nand focus and direction?\n\n253\n00:12:36.120 --> 00:12:42.440\nWe took a very small group of our colleagues and we said, \"Here's the challenge\n\n254\n00:12:42.440 --> 00:12:42.920\n.\"\n\n255\n00:12:42.920 --> 00:12:45.680\nThey did an absolute fantastic job.\n\n256\n00:12:45.680 --> 00:12:49.320\nThey came back and said, \"Larry, we need a purpose.\"\n\n257\n00:12:49.320 --> 00:12:52.720\nThat purpose is one sentence.\n\n258\n00:12:52.720 --> 00:12:59.100\nThis was back in 2011 and that purpose, it still stands to this day that our\n\n259\n00:12:59.100 --> 00:12:59.600\npurpose\n\n260\n00:12:59.600 --> 00:13:03.440\nas a company is helping people on their path to better health.\n\n261\n00:13:03.440 --> 00:13:05.600\nThat's so simple.\n\n262\n00:13:05.600 --> 00:13:07.160\nIt's simple.\n\n263\n00:13:07.160 --> 00:13:08.680\nIt's understood by everyone.\n\n264\n00:13:08.680 --> 00:13:16.610\nDavid, I knew that we hit the mark and I was visiting our stores and I still\n\n265\n00:13:16.610 --> 00:13:17.720\nremember\n\n266\n00:13:17.720 --> 00:13:19.680\nthis vividly.\n\n267\n00:13:19.680 --> 00:13:24.760\nWe were in Long Island and walked into the store with the region manager and I\n\n268\n00:13:24.760 --> 00:13:25.760\nhad observed\n\n269\n00:13:25.760 --> 00:13:33.750\none of our colleagues was helping an elderly customer taking bags off to her\n\n270\n00:13:33.750 --> 00:13:34.600\ncar.\n\n271\n00:13:34.600 --> 00:13:40.090\nOur employee comes back and I introduced myself and I said, \"Look, I just want\n\n272\n00:13:40.090 --> 00:13:40.760\nto take a minute\n\n273\n00:13:40.760 --> 00:13:41.760\nto thank you.\"\n\n274\n00:13:41.760 --> 00:13:46.880\nI said, \"I observed what you were doing in terms of that was great and thanked\n\n275\n00:13:46.880 --> 00:13:47.920\nthem.\"\n\n276\n00:13:47.920 --> 00:13:51.370\nThe employee said to me, \"Well, it's my way of helping people on their path to\n\n277\n00:13:51.370 --> 00:13:51.800\nbetter\n\n278\n00:13:51.800 --> 00:13:52.800\nhealth.\"\n\n279\n00:13:52.800 --> 00:13:56.880\nNow, this was someone who wasn't working in the pharmacy.\n\n280\n00:13:56.880 --> 00:14:02.000\nThey were working in what we call the front of store and they were able to\n\n281\n00:14:02.000 --> 00:14:03.040\ninternalize\n\n282\n00:14:03.040 --> 00:14:08.360\nwhat those words meant as to the job that they were doing every day.\n\n283\n00:14:08.360 --> 00:14:12.020\nI tell that story often because helping people on their path better helps\n\n284\n00:14:12.020 --> 00:14:13.200\nsomeone thinks,\n\n285\n00:14:13.200 --> 00:14:17.770\n\"Well, if I'm not filling a prescription or seeing a patient in one of our\n\n286\n00:14:17.770 --> 00:14:18.720\nclinics or\n\n287\n00:14:18.720 --> 00:14:24.630\nsome of the other health-related areas where you are providing health advice or\n\n288\n00:14:24.630 --> 00:14:25.000\nhealth care\n\n289\n00:14:25.000 --> 00:14:26.000\ntreatment.\"\n\n290\n00:14:26.000 --> 00:14:30.390\nThere are countless examples out there like that where people have internalized\n\n291\n00:14:30.390 --> 00:14:31.200\nthat in\n\n292\n00:14:31.200 --> 00:14:32.200\nvery meaningful ways.\n\n293\n00:14:32.200 --> 00:14:34.640\nI love the fact that you talked about the consults.\n\n294\n00:14:34.640 --> 00:14:35.640\nI had the first one.\n\n295\n00:14:35.640 --> 00:14:39.600\nI think it was all laminated but nobody really could internalize it.\n\n296\n00:14:39.600 --> 00:14:43.120\nIt's really interesting because I think the great visions are ones that you're\n\n297\n00:14:43.120 --> 00:14:43.160\ngoing to\n\n298\n00:14:43.160 --> 00:14:46.250\nmake and you can understand and then people can personalize it like you say and\n\n299\n00:14:46.250 --> 00:14:46.720\nsay, \"This\n\n300\n00:14:46.720 --> 00:14:51.160\nis how I can make it happen at my piece of CVS Health.\"\n\n301\n00:14:51.160 --> 00:14:53.160\nSo I can see how that really works.\n\n302\n00:14:53.160 --> 00:14:58.160\nLarry, great leaders have to make courageous calls.\n\n303\n00:14:58.160 --> 00:15:00.240\nTell us the story of how you made the decision.\n\n304\n00:15:00.240 --> 00:15:01.960\nI remember hearing this actually.\n\n305\n00:15:01.960 --> 00:15:05.130\nIt was in my own board room when people were talking about it and it was in the\n\n306\n00:15:05.130 --> 00:15:05.760\nWall Street\n\n307\n00:15:05.760 --> 00:15:07.520\nJournal.\n\n308\n00:15:07.520 --> 00:15:12.540\nYou became the first major retailer to take tobacco products out of your stores\n\n309\n00:15:12.540 --> 00:15:12.600\n.\n\n310\n00:15:12.600 --> 00:15:16.160\nTell us how you thought through that whole process.\n\n311\n00:15:16.160 --> 00:15:21.510\nWe talked earlier about our longer-term strategy was we wanted to be more of a\n\n312\n00:15:21.510 --> 00:15:22.440\nhealth care\n\n313\n00:15:22.440 --> 00:15:24.000\ncompany.\n\n314\n00:15:24.000 --> 00:15:28.710\nThat was being defined and there were things that we were doing whether it was\n\n315\n00:15:28.710 --> 00:15:29.280\nopening\n\n316\n00:15:29.280 --> 00:15:32.890\nwhat today is called \"Medic clinics in our stores\" or some of the things that\n\n317\n00:15:32.890 --> 00:15:33.360\nwe were\n\n318\n00:15:33.360 --> 00:15:38.940\ndoing in our pharmacies that went beyond just filling a prescription and we now\n\n319\n00:15:38.940 --> 00:15:39.240\nown\n\n320\n00:15:39.240 --> 00:15:43.910\nthe pharmacy benefit management company and the synergy that could be created\n\n321\n00:15:43.910 --> 00:15:44.280\nacross\n\n322\n00:15:44.280 --> 00:15:46.440\nthose two businesses.\n\n323\n00:15:46.440 --> 00:15:51.120\nI could remember going to several meetings with various health professionals.\n\n324\n00:15:51.120 --> 00:15:55.020\nIt could have been an integrated delivery system and it would be talking about\n\n325\n00:15:55.020 --> 00:15:55.320\nsome\n\n326\n00:15:55.320 --> 00:16:00.370\nof the things that we could do, recognizing our local presence and the fact\n\n327\n00:16:00.370 --> 00:16:01.320\nthat we would\n\n328\n00:16:01.320 --> 00:16:06.480\nsee millions of customers every day in our retail pharmacies.\n\n329\n00:16:06.480 --> 00:16:09.810\nWe would be having great conversations and halfway two-thirds of the way\n\n330\n00:16:09.810 --> 00:16:10.440\nthrough the\n\n331\n00:16:10.440 --> 00:16:12.120\nconversation.\n\n332\n00:16:12.120 --> 00:16:18.160\nSomeone would speak up and say, \"Well, Larry, but CBS sells tobacco.\"\n\n333\n00:16:18.160 --> 00:16:23.280\nThat drum beat, it played out more times than not in those meetings.\n\n334\n00:16:23.280 --> 00:16:28.200\nAnd David, what I found was the enthusiasm and the energy that was in the room.\n\n335\n00:16:28.200 --> 00:16:32.120\nWhen that question got asked, it just sucked all the air out of the room.\n\n336\n00:16:32.120 --> 00:16:36.100\nIt felt like you wanted to crawl under the table and oftentimes the meetings\n\n337\n00:16:36.100 --> 00:16:36.840\nended with\n\n338\n00:16:36.840 --> 00:16:40.640\n\"Thanks for coming\" and that was a very interesting conversation.\n\n339\n00:16:40.640 --> 00:16:47.340\nThe follow-up was, \"Yeah, we were really never able to get any momentum from\n\n340\n00:16:47.340 --> 00:16:49.800\nthose discussions.\"\n\n341\n00:16:49.800 --> 00:16:56.360\nI could remember coming back among our leadership team and we started talking\n\n342\n00:16:56.360 --> 00:16:57.960\nabout that.\n\n343\n00:16:57.960 --> 00:17:02.640\nAt the time, we generated about $2 billion of revenues.\n\n344\n00:17:02.640 --> 00:17:06.570\nWhat we were looking at was there was about a billion and a half of tobacco\n\n345\n00:17:06.570 --> 00:17:07.200\nsales.\n\n346\n00:17:07.200 --> 00:17:12.160\nThen, as we looked at what else did folks buy as part of purchasing a pack of\n\n347\n00:17:12.160 --> 00:17:13.200\ncigarettes,\n\n348\n00:17:13.200 --> 00:17:16.800\nyou would see gum or mince.\n\n349\n00:17:16.800 --> 00:17:20.540\nThe reality was you could see that those purchases, people were thinking of us\n\n350\n00:17:20.540 --> 00:17:21.640\nmore as a convenience\n\n351\n00:17:21.640 --> 00:17:22.640\nstore.\n\n352\n00:17:22.640 --> 00:17:25.910\nThere was $2 billion worth of revenues at stake, but we were having the\n\n353\n00:17:25.910 --> 00:17:27.080\ndiscussion that, \"Well,\n\n354\n00:17:27.080 --> 00:17:28.080\nhere's our strategy.\n\n355\n00:17:28.080 --> 00:17:29.960\nHere's our long-term strategy.\"\n\n356\n00:17:29.960 --> 00:17:34.120\nThis absolutely has proven to be a barrier in terms of getting any traction.\n\n357\n00:17:34.120 --> 00:17:37.320\nI remember we put a whole presentation together.\n\n358\n00:17:37.320 --> 00:17:43.040\nWe very quietly went out and surveyed some health professionals.\n\n359\n00:17:43.040 --> 00:17:47.580\nThe one thing that I was extremely concerned about is that hopefully everyone\n\n360\n00:17:47.580 --> 00:17:48.280\nis shocked\n\n361\n00:17:48.280 --> 00:17:51.640\nin a CBS pharmacy, but we sell candy.\n\n362\n00:17:51.640 --> 00:17:52.720\nWe sell chips.\n\n363\n00:17:52.720 --> 00:17:55.880\nWe sell soda.\n\n364\n00:17:55.880 --> 00:18:00.920\nWe even sell spirits and alcohol in states where it's permitted.\n\n365\n00:18:00.920 --> 00:18:05.360\nI was concerned in terms of, \"Well, if we stopped selling tobacco, where would\n\n366\n00:18:05.360 --> 00:18:06.080\nit stop?\n\n367\n00:18:06.080 --> 00:18:09.000\nWould it spill into those products?\"\n\n368\n00:18:09.000 --> 00:18:13.000\nI did get comfortable in talking to health professionals.\n\n369\n00:18:13.000 --> 00:18:16.280\nWhen you asked that question, they turned around and said, \"Larry, stop right\n\n370\n00:18:16.280 --> 00:18:17.320\nthere.\"\n\n371\n00:18:17.320 --> 00:18:22.360\nThere is no amount of tobacco use that could be considered safe.\n\n372\n00:18:22.360 --> 00:18:26.800\nThe other products that you rattled off, yes, there are challenges in our\n\n373\n00:18:26.800 --> 00:18:27.800\nsociety around\n\n374\n00:18:27.800 --> 00:18:32.630\nobesity, but those products taken in moderation have not been proven to cause\n\n375\n00:18:32.630 --> 00:18:34.080\nthe medical harm\n\n376\n00:18:34.080 --> 00:18:35.600\nthat tobacco does.\n\n377\n00:18:35.600 --> 00:18:38.760\nThey were essentially saying, \"We got your back on that.\"\n\n378\n00:18:38.760 --> 00:18:43.820\nI remember going to our board, and that was a very, very sleepless night before\n\n379\n00:18:43.820 --> 00:18:44.200\nthat\n\n380\n00:18:44.200 --> 00:18:45.480\nboard.\n\n381\n00:18:45.480 --> 00:18:49.400\nI can imagine $2 billion in revenue.\n\n382\n00:18:49.400 --> 00:18:53.490\nAs you might expect, I had socialized the thought with some of the, I'll say,\n\n383\n00:18:53.490 --> 00:18:53.960\nthe key\n\n384\n00:18:53.960 --> 00:18:57.720\nleaders on our board and had gotten their feedback.\n\n385\n00:18:57.720 --> 00:19:03.250\nDavid, it's probably a board meeting that I'll never forget because the support\n\n386\n00:19:03.250 --> 00:19:03.640\nfrom\n\n387\n00:19:03.640 --> 00:19:05.760\nthe board was unprecedented.\n\n388\n00:19:05.760 --> 00:19:09.080\nIt ended up becoming a very quick conversation.\n\n389\n00:19:09.080 --> 00:19:12.900\nI still remember one of our board members saying, \"Larry, look, it's the right\n\n390\n00:19:12.900 --> 00:19:13.280\nthing\n\n391\n00:19:13.280 --> 00:19:14.800\nto do.\"\n\n392\n00:19:14.800 --> 00:19:18.200\nOne of the things that I want to emphasize is, \"Don't be shy about telling the\n\n393\n00:19:18.200 --> 00:19:19.360\nstory.\n\n394\n00:19:19.360 --> 00:19:23.710\nJust go out there and you've got nothing to be embarrassed about in terms of\n\n395\n00:19:23.710 --> 00:19:24.280\nwalking\n\n396\n00:19:24.280 --> 00:19:26.240\naway from $2 billion.\n\n397\n00:19:26.240 --> 00:19:27.920\nYou'll be challenged.\n\n398\n00:19:27.920 --> 00:19:32.160\nThe investor community will scratch their head.\n\n399\n00:19:32.160 --> 00:19:36.080\nYou're going to talk about our journey as a healthcare company.\"\n\n400\n00:19:36.080 --> 00:19:41.000\nI vividly remember not just that meeting, but what transpired shortly after\n\n401\n00:19:41.000 --> 00:19:42.880\nbecause we put\n\n402\n00:19:42.880 --> 00:19:44.840\nthe plan together.\n\n403\n00:19:44.840 --> 00:19:50.930\nI remember it was in February of 2014 where we did some embargoed interviews\n\n404\n00:19:50.930 --> 00:19:51.600\nwith the\n\n405\n00:19:51.600 --> 00:19:55.160\nkey newspapers across the country.\n\n406\n00:19:55.160 --> 00:20:00.120\nThere was myself, our chief medical officer, our kind of marketing.\n\n407\n00:20:00.120 --> 00:20:04.470\nAfter the second or third interview, I remember asking folks, I said, \"Hey,\n\n408\n00:20:04.470 --> 00:20:05.400\nthere's a theme\n\n409\n00:20:05.400 --> 00:20:07.480\nthat's emerging here.\"\n\n410\n00:20:07.480 --> 00:20:09.480\nIt didn't matter who we were talking to.\n\n411\n00:20:09.480 --> 00:20:15.510\nAt the end of the interview, the reporter wanted to tell you their story about\n\n412\n00:20:15.510 --> 00:20:16.600\nhow tobacco\n\n413\n00:20:16.600 --> 00:20:19.320\nimpacted their life.\n\n414\n00:20:19.320 --> 00:20:21.400\nIt usually involved a family member.\n\n415\n00:20:21.400 --> 00:20:25.000\nThey told the story like it happened yesterday, even though it could have\n\n416\n00:20:25.000 --> 00:20:26.520\nhappened 10, 15,\n\n417\n00:20:26.520 --> 00:20:28.000\n20 years ago.\n\n418\n00:20:28.000 --> 00:20:31.520\nWe were able to take that thought, both internally and externally, with our\n\n419\n00:20:31.520 --> 00:20:32.400\nemployees as well\n\n420\n00:20:32.400 --> 00:20:38.240\nas the communities at large in terms of tell-a-shear story.\n\n421\n00:20:38.240 --> 00:20:42.240\nWe had a company with programs that we put in place in terms of how we could\n\n422\n00:20:42.240 --> 00:20:42.880\nhelp people\n\n423\n00:20:42.880 --> 00:20:45.800\nwho wanted to stop using tobacco products.\n\n424\n00:20:45.800 --> 00:20:50.200\nIt takes an individual on average seven times before they're successful in\n\n425\n00:20:50.200 --> 00:20:51.080\nterms of kicking\n\n426\n00:20:51.080 --> 00:20:53.040\nthe tobacco habit.\n\n427\n00:20:53.040 --> 00:21:01.920\nThere was a tremendous, tremendous outpouring of our employees, the communities\n\n428\n00:21:01.920 --> 00:21:02.640\nat large\n\n429\n00:21:02.640 --> 00:21:06.720\nin terms of support for that decision.\n\n430\n00:21:06.720 --> 00:21:13.950\nAs I look back on that, it'll be one of the highlights of my career because it\n\n431\n00:21:13.950 --> 00:21:14.840\nremoved\n\n432\n00:21:14.840 --> 00:21:16.440\nthat barrier.\n\n433\n00:21:16.440 --> 00:21:20.450\nI look at all the things that we've been able to do as a healthcare company\n\n434\n00:21:20.450 --> 00:21:21.840\nsince 2014,\n\n435\n00:21:21.840 --> 00:21:26.400\nthat I think back and I'm confident that I know many of those doors would never\n\n436\n00:21:26.400 --> 00:21:26.760\nhave\n\n437\n00:21:26.760 --> 00:21:29.440\nbeen opened had we not made that decision.\n\n438\n00:21:29.440 --> 00:21:33.680\nWhen did you make a decision, Larry, to go to the CVS Health?\n\n439\n00:21:33.680 --> 00:21:38.520\nDavid, we made the decision shortly thereafter because it was interesting.\n\n440\n00:21:38.520 --> 00:21:42.920\nWe made the announcement in February 14, as I mentioned.\n\n441\n00:21:42.920 --> 00:21:46.120\nAt the time, we had about 7,600 stores.\n\n442\n00:21:46.120 --> 00:21:50.680\nWe said we need six months to eliminate tobacco from our stores.\n\n443\n00:21:50.680 --> 00:21:54.800\nWe were going to sell down the inventory, etc., etc.\n\n444\n00:21:54.800 --> 00:21:59.360\nBased on the reaction that we got out of the gate, our corporate identity at\n\n445\n00:21:59.360 --> 00:21:59.960\nthe time\n\n446\n00:21:59.960 --> 00:22:05.320\nwas CVS Caremark, which there was nothing that resonated to the consumer about\n\n447\n00:22:05.320 --> 00:22:05.720\nthat\n\n448\n00:22:05.720 --> 00:22:07.040\nname.\n\n449\n00:22:07.040 --> 00:22:08.320\nWe said, \"You know what?\n\n450\n00:22:08.320 --> 00:22:11.400\nFrom the reaction that we got, the learnings that we've got, there is an\n\n451\n00:22:11.400 --> 00:22:12.320\nopportunity to\n\n452\n00:22:12.320 --> 00:22:19.360\nrebrand the company as more of a health company, recognizing that that was the\n\n453\n00:22:19.360 --> 00:22:20.360\njourney that\n\n454\n00:22:20.360 --> 00:22:21.360\nwe had begun.\n\n455\n00:22:21.360 --> 00:22:25.400\nEliminating tobacco was another step in that journey.\"\n\n456\n00:22:25.400 --> 00:22:28.920\nThere was a lot of things that we also began to do.\n\n457\n00:22:28.920 --> 00:22:32.770\nWe had a five-year program that we launched called Be the First, our goal\n\n458\n00:22:32.770 --> 00:22:33.280\nworking with\n\n459\n00:22:33.280 --> 00:22:37.880\ncommunity partners to create the first tobacco-free generation.\n\n460\n00:22:37.880 --> 00:22:41.360\nWe've got a lot of proof points that have demonstrated the progress that we\n\n461\n00:22:41.360 --> 00:22:43.120\nmade there.\n\n462\n00:22:43.120 --> 00:22:48.360\nSix months later, actually five months later, because it was September 3, 2014,\n\n463\n00:22:48.360 --> 00:22:49.360\nthat we announced\n\n464\n00:22:49.360 --> 00:22:51.400\nthat we were tobacco-free.\n\n465\n00:22:51.400 --> 00:22:56.480\nAs part of that announcement, we announced our new corporate name, CVS Health.\n\n466\n00:22:56.480 --> 00:22:57.480\nGreat.\n\n467\n00:22:57.480 --> 00:22:59.120\nThat's a great story.\n\n468\n00:22:59.120 --> 00:23:02.120\nYou talked about how everybody has a personal story with tobacco.\n\n469\n00:23:02.120 --> 00:23:04.320\nI understand that you have a personal story.\n\n470\n00:23:04.320 --> 00:23:08.160\nYour father died from cancer, of a cigarette-related disease.\n\n471\n00:23:08.160 --> 00:23:09.160\nYeah, David.\n\n472\n00:23:09.160 --> 00:23:12.200\nHe was my father passed away at a young age.\n\n473\n00:23:12.200 --> 00:23:13.200\nHe was 57.\n\n474\n00:23:13.200 --> 00:23:14.600\nI had to cancer.\n\n475\n00:23:14.600 --> 00:23:18.190\nHe worked in the glass factory, and he chewed tobacco during the day, and he\n\n476\n00:23:18.190 --> 00:23:18.920\nsmoked cigars\n\n477\n00:23:18.920 --> 00:23:19.920\nin the evening.\n\n478\n00:23:19.920 --> 00:23:26.830\nHe either had a chew going, or that cigar was attached to his lips, whether it\n\n479\n00:23:26.830 --> 00:23:27.560\nwas lit\n\n480\n00:23:27.560 --> 00:23:28.560\nor not.\n\n481\n00:23:28.560 --> 00:23:32.600\nLook, he was a wonderful individual.\n\n482\n00:23:32.600 --> 00:23:37.220\nI regret the fact that he died at such a young age, and the time that that took\n\n483\n00:23:37.220 --> 00:23:37.520\naway\n\n484\n00:23:37.520 --> 00:23:45.240\nfrom the two of us being able to spend time together as myself as a young adult\n\n485\n00:23:45.240 --> 00:23:45.400\n.\n\n486\n00:23:45.400 --> 00:23:46.400\nThink about him often.\n\n487\n00:23:46.400 --> 00:23:48.640\nYeah, I'm sure you do.\n\n488\n00:23:48.640 --> 00:23:55.260\nNow, Larry, as you've evolved as a health services company, you've got a really\n\n489\n00:23:55.260 --> 00:23:56.960\ninteresting model.\n\n490\n00:23:56.960 --> 00:23:58.640\nIt's totally unique in the industry.\n\n491\n00:23:58.640 --> 00:24:00.040\nIt's an interconnected model.\n\n492\n00:24:00.040 --> 00:24:02.400\nYou have over 10,000 pharmacies.\n\n493\n00:24:02.400 --> 00:24:04.120\nYou've got an insurance.\n\n494\n00:24:04.120 --> 00:24:07.640\nYou've got a pharmacy benefit management company.\n\n495\n00:24:07.640 --> 00:24:11.240\nHow are you bringing this whole company together?\n\n496\n00:24:11.240 --> 00:24:12.800\nWhat's your vision here?\n\n497\n00:24:12.800 --> 00:24:18.720\nThe vision is obviously everyone sees the challenges that exist in our health\n\n498\n00:24:18.720 --> 00:24:22.480\ncare system today.\n\n499\n00:24:22.480 --> 00:24:29.320\nIt's very complicated and can be confusing to access and navigate.\n\n500\n00:24:29.320 --> 00:24:35.000\nIt's become very costly and unfortunately unaffordable for many.\n\n501\n00:24:35.000 --> 00:24:39.560\nAs we think about how we can change the way care is delivered in the country,\n\n502\n00:24:39.560 --> 00:24:40.240\nwe really\n\n503\n00:24:40.240 --> 00:24:45.200\nthink about three imperatives that are associated with that.\n\n504\n00:24:45.200 --> 00:24:49.000\nThe first one is to make health care local and to meet people where they are,\n\n505\n00:24:49.000 --> 00:24:49.160\nwhether\n\n506\n00:24:49.160 --> 00:24:54.960\nit's in their community, in their home, or now in the palm of your hand.\n\n507\n00:24:54.960 --> 00:24:57.760\nThe second is to make health care simple.\n\n508\n00:24:57.760 --> 00:25:04.530\nWe believe that we can provide the information and the navigation so people can\n\n509\n00:25:04.530 --> 00:25:05.560\naccess what\n\n510\n00:25:05.560 --> 00:25:10.680\nthey need and the resources that they need to make an informed decision.\n\n511\n00:25:10.680 --> 00:25:15.960\nThe third, and we think about this one, David, is being our North Star.\n\n512\n00:25:15.960 --> 00:25:20.600\nGo back to that purpose of helping people on their path to better health.\n\n513\n00:25:20.600 --> 00:25:25.090\nYou look at today that we've got about two-thirds of our country that has one\n\n514\n00:25:25.090 --> 00:25:26.080\nor more chronic\n\n515\n00:25:26.080 --> 00:25:27.320\ndiseases.\n\n516\n00:25:27.320 --> 00:25:29.200\nWe know their names.\n\n517\n00:25:29.200 --> 00:25:34.160\nIt's hypertension, cardiovascular, diabetes, asthma.\n\n518\n00:25:34.160 --> 00:25:38.190\nThere are eight or nine of those chronic diseases that are accounting for\n\n519\n00:25:38.190 --> 00:25:39.720\nanywhere from 75 to\n\n520\n00:25:39.720 --> 00:25:42.760\n80 percent of all health care costs.\n\n521\n00:25:42.760 --> 00:25:48.590\nYet, those individuals with chronic disease are not achieving their best health\n\n522\n00:25:48.590 --> 00:25:50.040\noutcome.\n\n523\n00:25:50.040 --> 00:25:52.960\nI was sharing this story with someone.\n\n524\n00:25:52.960 --> 00:25:56.250\nThey stopped me in the middle of it and they said, \"Larry, it sounds like you\n\n525\n00:25:56.250 --> 00:25:56.800\nwant to cure\n\n526\n00:25:56.800 --> 00:25:57.800\ndiabetes.\"\n\n527\n00:25:57.800 --> 00:26:00.880\nI said, \"We're not going to be able to cure diabetes.\"\n\n528\n00:26:00.880 --> 00:26:04.320\nI said, \"We'll leave that to the researchers.\"\n\n529\n00:26:04.320 --> 00:26:09.160\nWe can help the 30-plus million individuals today that have diabetes.\n\n530\n00:26:09.160 --> 00:26:13.260\nWe can help them achieve their best health, making sure that they're staying\n\n531\n00:26:13.260 --> 00:26:13.880\nadherent\n\n532\n00:26:13.880 --> 00:26:15.080\nto their medications.\n\n533\n00:26:15.080 --> 00:26:18.720\nThey're getting the appropriate frequency of blood testing.\n\n534\n00:26:18.720 --> 00:26:23.280\nThey're following the instructions that they may have around diet, nutrition,\n\n535\n00:26:23.280 --> 00:26:24.680\nand exercise.\n\n536\n00:26:24.680 --> 00:26:28.870\nDavid, we look at our health care system today that that individual may be\n\n537\n00:26:28.870 --> 00:26:29.760\nvisiting their\n\n538\n00:26:29.760 --> 00:26:32.080\nphysician on a quarterly basis.\n\n539\n00:26:32.080 --> 00:26:34.000\nMaybe it's even less frequent.\n\n540\n00:26:34.000 --> 00:26:36.640\nThey leave with that care plan.\n\n541\n00:26:36.640 --> 00:26:42.190\nThe system fails way too many people because no one knows if that care plan is\n\n542\n00:26:42.190 --> 00:26:43.440\nbeing followed\n\n543\n00:26:43.440 --> 00:26:47.200\nuntil an unintended consequence happens.\n\n544\n00:26:47.200 --> 00:26:50.680\nAt that point, we would sit here and say it's too late.\n\n545\n00:26:50.680 --> 00:26:56.770\nThose are the imperatives that we have as an organization to change the\n\n546\n00:26:56.770 --> 00:26:58.000\ntrajectory of\n\n547\n00:26:58.000 --> 00:27:02.760\ncare and in doing so help people achieve a better health outcome.\n\n548\n00:27:02.760 --> 00:27:06.000\nAt the same time, we do so for all health care costs.\n\n549\n00:27:06.000 --> 00:27:10.870\nThe one thing that has been interesting, and obviously as a country, we've been\n\n550\n00:27:10.870 --> 00:27:11.480\ndealing\n\n551\n00:27:11.480 --> 00:27:16.830\nwith several crises over the last three months, the COVID-19 pandemic being\n\n552\n00:27:16.830 --> 00:27:17.840\nfront and center\n\n553\n00:27:17.840 --> 00:27:19.000\nfor many.\n\n554\n00:27:19.000 --> 00:27:25.400\nWe have seen our strategy come to life in very meaningful ways.\n\n555\n00:27:25.400 --> 00:27:31.360\nAll three of those dimensions of community in the home and in the hand.\n\n556\n00:27:31.360 --> 00:27:35.240\nWe've all heard about the need for testing and we have been able to bring\n\n557\n00:27:35.240 --> 00:27:36.040\ntesting into\n\n558\n00:27:36.040 --> 00:27:38.640\ncommunities all across the country.\n\n559\n00:27:38.640 --> 00:27:45.120\nWe've now tested as we sit here today over 400,000 individuals in communities.\n\n560\n00:27:45.120 --> 00:27:49.140\nWe have brought testing into the underserved communities where we've seen the\n\n561\n00:27:49.140 --> 00:27:49.680\npopulation\n\n562\n00:27:49.680 --> 00:27:57.850\nhelp data where the COVID-19 virus is disproportionately affecting the minority\n\n563\n00:27:57.850 --> 00:27:59.520\npopulations.\n\n564\n00:27:59.520 --> 00:28:04.110\nThe second thing is we've seen the pressure that the pandemic has put on\n\n565\n00:28:04.110 --> 00:28:05.080\nhospitals.\n\n566\n00:28:05.080 --> 00:28:07.320\nWe have worked with hospitals.\n\n567\n00:28:07.320 --> 00:28:12.130\nWe actually have a home infusion company to work collaboratively to discharge\n\n568\n00:28:12.130 --> 00:28:12.800\npatients\n\n569\n00:28:12.800 --> 00:28:19.640\nback into the home earlier than perhaps they would under normal circumstances.\n\n570\n00:28:19.640 --> 00:28:26.120\nWe've now made 80,000 visits into individuals homes providing infusion\n\n571\n00:28:26.120 --> 00:28:27.880\ntherapies in the comfort\n\n572\n00:28:27.880 --> 00:28:31.570\nand convenience of their home that would have otherwise been delivered from\n\n573\n00:28:31.570 --> 00:28:32.720\nwithin the hospital.\n\n574\n00:28:32.720 --> 00:28:36.560\nWe've freed up important bed capacity as a result.\n\n575\n00:28:36.560 --> 00:28:41.650\nThen we've seen a dramatic increase in the utilization of telemedicine where\n\n576\n00:28:41.650 --> 00:28:42.240\npeople are\n\n577\n00:28:42.240 --> 00:28:44.040\naccessing information.\n\n578\n00:28:44.040 --> 00:28:49.280\nThey're accessing care off of their iPads, their iPhones or their desktops.\n\n579\n00:28:49.280 --> 00:28:54.380\nThose are three ways that we have seen our strategy being accelerated as a\n\n580\n00:28:54.380 --> 00:28:55.360\nresult of\n\n581\n00:28:55.360 --> 00:28:57.600\nthe pandemic crisis.\n\n582\n00:28:57.600 --> 00:29:01.320\nLarry, congratulations to you and your team for the great job you've done\n\n583\n00:29:01.320 --> 00:29:01.920\nstepping up\n\n584\n00:29:01.920 --> 00:29:04.120\nwith COVID-19.\n\n585\n00:29:04.120 --> 00:29:07.720\nIt's been amazing and certainly appreciated by so many.\n\n586\n00:29:07.720 --> 00:29:11.650\nI thought that you as a leader did an absolutely terrific job working with\n\n587\n00:29:11.650 --> 00:29:12.680\nPresident Trump\n\n588\n00:29:12.680 --> 00:29:18.040\nto help form that private public partnership to get our country through the\n\n589\n00:29:18.040 --> 00:29:19.560\ntesting process.\n\n590\n00:29:19.560 --> 00:29:25.120\nHow did that come about and how did you see your role as a leader during that?\n\n591\n00:29:25.120 --> 00:29:31.880\nI'm glad you brought up public private partnership because there's so much that\n\n592\n00:29:31.880 --> 00:29:32.880\ngets discussed\n\n593\n00:29:32.880 --> 00:29:37.520\nabout should the government do this, government do this.\n\n594\n00:29:37.520 --> 00:29:43.360\nWe talk a lot about the role of the private sector and I believe that your\n\n595\n00:29:43.360 --> 00:29:44.360\nquestion is\n\n596\n00:29:44.360 --> 00:29:49.680\na perfect example of the importance of public private partnership.\n\n597\n00:29:49.680 --> 00:29:54.180\nThe government can write the rules and establish the guardrails, if you will,\n\n598\n00:29:54.180 --> 00:29:55.400\nbut handing things\n\n599\n00:29:55.400 --> 00:30:00.220\noff to the private sector, I think that's where competition, innovation becomes\n\n600\n00:30:00.220 --> 00:30:01.240\nso important.\n\n601\n00:30:01.240 --> 00:30:07.240\nThe one thing that I'm extremely proud of is we talk about the work of our CBS\n\n602\n00:30:07.240 --> 00:30:08.240\ncolleagues\n\n603\n00:30:08.240 --> 00:30:15.490\nand I could not be proud of how they've stepped up to the challenges that his\n\n604\n00:30:15.490 --> 00:30:16.760\ncreated as a\n\n605\n00:30:16.760 --> 00:30:17.760\nbusiness.\n\n606\n00:30:17.760 --> 00:30:20.760\nBut acknowledging that the same challenges that we've all dealt with as\n\n607\n00:30:20.760 --> 00:30:21.360\nindividuals\n\n608\n00:30:21.360 --> 00:30:25.050\nin our personal lives, our colleagues have been dealing with the same\n\n609\n00:30:25.050 --> 00:30:26.120\nchallenges but have\n\n610\n00:30:26.120 --> 00:30:30.410\nstepped up and done phenomenal things in supporting their customers and the\n\n611\n00:30:30.410 --> 00:30:31.400\ncommunities in which\n\n612\n00:30:31.400 --> 00:30:33.120\nwe live and serve.\n\n613\n00:30:33.120 --> 00:30:38.160\nThe second thing that I'll mention is within industry, sure, we're competitors\n\n614\n00:30:38.160 --> 00:30:38.440\nbut I'm\n\n615\n00:30:38.440 --> 00:30:42.800\nalso very proud of what we have done as an industry.\n\n616\n00:30:42.800 --> 00:30:48.160\nWe've been on the phone many times sharing our experiences and learning from\n\n617\n00:30:48.160 --> 00:30:49.080\none another\n\n618\n00:30:49.080 --> 00:30:56.760\nand all for the betterment of the individuals that we're serving.\n\n619\n00:30:56.760 --> 00:31:02.050\nI think it's something that, again, we can and should be proud of and I think\n\n620\n00:31:02.050 --> 00:31:02.920\nsomething\n\n621\n00:31:02.920 --> 00:31:07.560\nthat will carry us forward even after we get this pandemic behind us.\n\n622\n00:31:07.560 --> 00:31:10.930\nSpeaking of that, Larry, are you doing anything now from a proactive\n\n623\n00:31:10.930 --> 00:31:12.200\nperspective in terms of\n\n624\n00:31:12.200 --> 00:31:14.360\nplanning for when we get the vaccine?\n\n625\n00:31:14.360 --> 00:31:19.220\nDavid, another great question and we're doing a tremendous amount of planning\n\n626\n00:31:19.220 --> 00:31:20.080\naround that.\n\n627\n00:31:20.080 --> 00:31:25.860\nAs you think about, let's fast forward a bit and think about the fall timeframe\n\n628\n00:31:25.860 --> 00:31:26.640\nbecause\n\n629\n00:31:26.640 --> 00:31:31.080\nwe will have the return of what I'll call the seasonal flu.\n\n630\n00:31:31.080 --> 00:31:35.020\nThat's something that we did not have to deal with back in the March timeframe\n\n631\n00:31:35.020 --> 00:31:35.800\nwhen the pandemic\n\n632\n00:31:35.800 --> 00:31:37.440\nwas on us.\n\n633\n00:31:37.440 --> 00:31:42.960\nIf you think back to March, the seasonal flu was winding down and fast forward\n\n634\n00:31:42.960 --> 00:31:43.480\nto the\n\n635\n00:31:43.480 --> 00:31:48.460\nfall and early winter months that when the seasonal flu returns, think about\n\n636\n00:31:48.460 --> 00:31:49.000\nall of us\n\n637\n00:31:49.000 --> 00:31:53.780\nas individuals that we can probably recall a time where we had a mild case of\n\n638\n00:31:53.780 --> 00:31:54.360\nthe flu\n\n639\n00:31:54.360 --> 00:32:00.420\nand the sniffles and the head cold and we probably powered through, came to\n\n640\n00:32:00.420 --> 00:32:02.200\nwork and\n\n641\n00:32:02.200 --> 00:32:04.200\nthat's going to be different this time.\n\n642\n00:32:04.200 --> 00:32:08.630\nI think as individuals, as human beings, the first thing we're going to want to\n\n643\n00:32:08.630 --> 00:32:08.920\ncheck the\n\n644\n00:32:08.920 --> 00:32:13.540\nbox on is, \"Okay, I have symptoms. The symptoms are similar. Do I have the\n\n645\n00:32:13.540 --> 00:32:14.440\nseasonal flu or\n\n646\n00:32:14.440 --> 00:32:16.400\ndo I have COVID-19?\"\n\n647\n00:32:16.400 --> 00:32:22.160\nAnd we're going to want to get tested to bifurcate or to answer that important\n\n648\n00:32:22.160 --> 00:32:23.200\nquestion.\n\n649\n00:32:23.200 --> 00:32:27.440\nThe second thing, David, that we all talk a lot about, it's time to get your\n\n650\n00:32:27.440 --> 00:32:28.000\nflu shot\n\n651\n00:32:28.000 --> 00:32:33.920\nand we know less than 40% of individuals get the seasonal flu vaccine.\n\n652\n00:32:33.920 --> 00:32:38.090\nWe went out and surveyed some individuals three, four weeks ago and well over\n\n653\n00:32:38.090 --> 00:32:38.640\n60% of\n\n654\n00:32:38.640 --> 00:32:43.240\nindividuals said that, \"I'm going to be getting a flu shot this year.\"\n\n655\n00:32:43.240 --> 00:32:46.970\nIt makes sense, acknowledging what everyone has been going through over the\n\n656\n00:32:46.970 --> 00:32:48.400\nlast few months.\n\n657\n00:32:48.400 --> 00:32:54.300\nWe're planning for that fall timeframe with a real focus on getting as many\n\n658\n00:32:54.300 --> 00:32:55.920\npeople vaccinated\n\n659\n00:32:55.920 --> 00:32:58.640\nfor the seasonal flu vaccine.\n\n660\n00:32:58.640 --> 00:33:05.440\nAgain, continuing to ensure that our testing capabilities are sufficient for\n\n661\n00:33:05.440 --> 00:33:06.560\nsatisfying\n\n662\n00:33:06.560 --> 00:33:08.400\nthe need that will be out there.\n\n663\n00:33:08.400 --> 00:33:13.810\nAnd then to your point, I think that we all want to have some optimism that our\n\n664\n00:33:13.810 --> 00:33:14.840\nresearchers\n\n665\n00:33:14.840 --> 00:33:21.190\nwill crack the code on a COVID vaccine and we'll be ready, again, working with\n\n666\n00:33:21.190 --> 00:33:22.000\nthe public\n\n667\n00:33:22.000 --> 00:33:32.000\nsector to be able to be an access point for millions of Americans to be\n\n668\n00:33:32.000 --> 00:33:34.360\nvaccinated.\n\n669\n00:33:34.360 --> 00:33:40.370\nOur country, we've had through so much this year, 2020, we're now in the midst\n\n670\n00:33:40.370 --> 00:33:41.280\nof protests\n\n671\n00:33:41.280 --> 00:33:45.960\nand riots due to the brutal death of George Floyd.\n\n672\n00:33:45.960 --> 00:33:52.850\nHow has this impacted CVS and how have you as a leader stepped up to make\n\n673\n00:33:52.850 --> 00:33:54.440\nwhatever statement\n\n674\n00:33:54.440 --> 00:33:56.760\nneeded to be made for your company?\n\n675\n00:33:56.760 --> 00:34:06.440\nIt's a very important time in our company and in society in general.\n\n676\n00:34:06.440 --> 00:34:10.240\nThere's something different this time.\n\n677\n00:34:10.240 --> 00:34:17.160\nUnfortunately, it's another example of an act of, I'll describe it as inhumane\n\n678\n00:34:17.160 --> 00:34:18.080\ntreatment\n\n679\n00:34:18.080 --> 00:34:24.570\nof an individual that we have seen play out multiple times over the last few\n\n680\n00:34:24.570 --> 00:34:25.440\nyears.\n\n681\n00:34:25.440 --> 00:34:30.120\nAnd I know that we've held town hall meetings.\n\n682\n00:34:30.120 --> 00:34:36.410\nWe have colleague resource groups and I've met with our black colleague\n\n683\n00:34:36.410 --> 00:34:38.440\nresource group.\n\n684\n00:34:38.440 --> 00:34:44.720\nAnd look, we've talked openly in terms of what we've seen.\n\n685\n00:34:44.720 --> 00:34:50.220\nI believe that there's a different level of transparency that exists in these\n\n686\n00:34:50.220 --> 00:34:51.400\nconversations\n\n687\n00:34:51.400 --> 00:34:52.400\nthat we're having.\n\n688\n00:34:52.400 --> 00:34:58.440\nAnd as the leader of CVS, there's a new lens that we're approaching the\n\n689\n00:34:58.440 --> 00:34:59.880\ndiversity work\n\n690\n00:34:59.880 --> 00:35:04.440\nthat we do and a heightened sense of urgency.\n\n691\n00:35:04.440 --> 00:35:10.580\nAnd David, in listening to colleagues in our organization, one of the things\n\n692\n00:35:10.580 --> 00:35:11.520\nthat we're\n\n693\n00:35:11.520 --> 00:35:15.930\nembarking on, look, we have a lot of programs that are focused on colleague\n\n694\n00:35:15.930 --> 00:35:16.840\nengagement,\n\n695\n00:35:16.840 --> 00:35:21.940\ncolleague opportunities, things that we do in the communities to support our\n\n696\n00:35:21.940 --> 00:35:23.280\ncommunities.\n\n697\n00:35:23.280 --> 00:35:29.240\nAnd one of the things that we're undertaking is, look, we have an opportunity\n\n698\n00:35:29.240 --> 00:35:30.520\nhere to evaluate\n\n699\n00:35:30.520 --> 00:35:34.560\nall the things that we do and ask some very important questions.\n\n700\n00:35:34.560 --> 00:35:40.560\nMaybe this goes back to where we started in terms of taking time to understand\n\n701\n00:35:40.560 --> 00:35:41.200\nwhat's\n\n702\n00:35:41.200 --> 00:35:45.230\nthe issue that we're looking to solve and what are the guiding principles that\n\n703\n00:35:45.230 --> 00:35:45.720\nsupport\n\n704\n00:35:45.720 --> 00:35:47.200\nthose solutions.\n\n705\n00:35:47.200 --> 00:35:52.410\nAnd we're evaluating all the things that we do, what's working and why is it\n\n706\n00:35:52.410 --> 00:35:53.360\nworking?\n\n707\n00:35:53.360 --> 00:35:57.870\nAnd is there an opportunity to do more and accelerate the benefits that those\n\n708\n00:35:57.870 --> 00:35:58.360\nvarious\n\n709\n00:35:58.360 --> 00:36:00.440\nprograms might be providing?\n\n710\n00:36:00.440 --> 00:36:05.120\nAt the same time, what things aren't working and why aren't they working?\n\n711\n00:36:05.120 --> 00:36:06.920\nHow do we fix what may be broken?\n\n712\n00:36:06.920 --> 00:36:09.280\nAnd then, are there things that are missing?\n\n713\n00:36:09.280 --> 00:36:12.440\nAre there things that we're not doing that we need to?\n\n714\n00:36:12.440 --> 00:36:16.000\nIt's been very eye-opening for me.\n\n715\n00:36:16.000 --> 00:36:21.740\nDavid, I've gotten countless emails from colleagues of all ethnicity, males,\n\n716\n00:36:21.740 --> 00:36:22.880\nfemales.\n\n717\n00:36:22.880 --> 00:36:27.250\nAnd I think that what we've seen has, I've talked to a lot of our black\n\n718\n00:36:27.250 --> 00:36:28.240\nemployees in\n\n719\n00:36:28.240 --> 00:36:32.440\nterms of what they're feeling, but I've also got many emails from individuals\n\n720\n00:36:32.440 --> 00:36:33.000\nwho are\n\n721\n00:36:33.000 --> 00:36:34.000\nnot black.\n\n722\n00:36:34.000 --> 00:36:37.770\nAnd I say that because David, I read these emails and they're self-identifying\n\n723\n00:36:37.770 --> 00:36:38.560\nthemselves.\n\n724\n00:36:38.560 --> 00:36:43.770\nI read an email that Larry, I am a white female and here's where I work and\n\n725\n00:36:43.770 --> 00:36:46.560\nthey talk about\n\n726\n00:36:46.560 --> 00:36:51.520\ntheir experience in participating and listening in the town hall.\n\n727\n00:36:51.520 --> 00:36:55.750\nAnd then they talk about things that they want to do to be part of the solution\n\n728\n00:36:55.750 --> 00:36:55.880\n.\n\n729\n00:36:55.880 --> 00:37:01.240\nAnd has energized me in terms of what I've described as a new lens and a\n\n730\n00:37:01.240 --> 00:37:02.560\nheightened sense\n\n731\n00:37:02.560 --> 00:37:05.480\nof urgency to figure out what more we can do.\n\n732\n00:37:05.480 --> 00:37:09.200\nLarry, you're a tremendously visionary leader.\n\n733\n00:37:09.200 --> 00:37:14.490\nI don't know of too many people who could shape a company like you've shaped it\n\n734\n00:37:14.490 --> 00:37:14.800\nand\n\n735\n00:37:14.800 --> 00:37:17.360\ngrew it like you've shaped it.\n\n736\n00:37:17.360 --> 00:37:22.200\nTell us about as you look forward, how do you see your...\n\n737\n00:37:22.200 --> 00:37:26.840\nYou've got 10,000 pharmacies, what's your store of the future look like?\n\n738\n00:37:26.840 --> 00:37:30.140\nI've read about like so many people, your health ups, talk a little bit about\n\n739\n00:37:30.140 --> 00:37:30.600\nwhat you're\n\n740\n00:37:30.600 --> 00:37:31.600\ntrying to do there.\n\n741\n00:37:31.600 --> 00:37:35.520\nThanks for asking that because I love talking about this one.\n\n742\n00:37:35.520 --> 00:37:41.880\nBut David, it really goes back to the strategy of making healthcare local\n\n743\n00:37:41.880 --> 00:37:43.320\nsimple and what\n\n744\n00:37:43.320 --> 00:37:48.170\nwe can do to help individuals, especially those with chronic disease achieve a\n\n745\n00:37:48.170 --> 00:37:48.680\nbetter\n\n746\n00:37:48.680 --> 00:37:49.880\nhealth outcome.\n\n747\n00:37:49.880 --> 00:37:55.370\nAnd David, I remember wrestling with this discussion that I'm going to go back\n\n748\n00:37:55.370 --> 00:37:58.040\n40 years.\n\n749\n00:37:58.040 --> 00:38:03.170\nThose first stores that I worked in as a pharmacist and then a manager of the\n\n750\n00:38:03.170 --> 00:38:03.320\nstore,\n\n751\n00:38:03.320 --> 00:38:06.160\nI had a soda fountain in those stores.\n\n752\n00:38:06.160 --> 00:38:10.420\nAnd I could remember getting to the store at 6.30 in the morning because you\n\n753\n00:38:10.420 --> 00:38:11.000\nhad to fire\n\n754\n00:38:11.000 --> 00:38:14.280\nup the grill because it's 7 a.m., 7.15.\n\n755\n00:38:14.280 --> 00:38:16.160\nYou had breakfast on the griddle.\n\n756\n00:38:16.160 --> 00:38:18.200\nAnd the suits were filled.\n\n757\n00:38:18.200 --> 00:38:23.840\nAnd you've seen how the evolution of pharmacies has taken place.\n\n758\n00:38:23.840 --> 00:38:28.270\nAnd for years we wrestled with this question, are we a convenience store that\n\n759\n00:38:28.270 --> 00:38:28.840\nhappens to\n\n760\n00:38:28.840 --> 00:38:31.000\nhave a pharmacy in the back?\n\n761\n00:38:31.000 --> 00:38:35.160\nOr are we a pharmacy that has a convenience offering?\n\n762\n00:38:35.160 --> 00:38:38.780\nAnd I know that sounds like a very subtle difference, but the answer to those\n\n763\n00:38:38.780 --> 00:38:39.560\ntwo questions\n\n764\n00:38:39.560 --> 00:38:41.800\nis a mile wide.\n\n765\n00:38:41.800 --> 00:38:47.060\nAnd as we decided that our future was as a health care and health services\n\n766\n00:38:47.060 --> 00:38:47.960\ncompany,\n\n767\n00:38:47.960 --> 00:38:53.730\nwe answered that question that we're a pharmacy that will have a convenience\n\n768\n00:38:53.730 --> 00:38:54.800\noffering.\n\n769\n00:38:54.800 --> 00:39:00.440\nSo we begun the repurposing of our stores to bring that vision to life.\n\n770\n00:39:00.440 --> 00:39:04.040\nAnd we think about the role of what we call the front of store.\n\n771\n00:39:04.040 --> 00:39:07.800\nAnd yet you have all these health related items.\n\n772\n00:39:07.800 --> 00:39:12.000\nWe also think about the role of personal care, whether it's dental care\n\n773\n00:39:12.000 --> 00:39:14.040\nproducts or skin care\n\n774\n00:39:14.040 --> 00:39:16.680\nproducts, and then beauty.\n\n775\n00:39:16.680 --> 00:39:22.870\nAnd those three categories, health, beauty, personal care, they take up about\n\n776\n00:39:22.870 --> 00:39:23.680\ntwo thirds\n\n777\n00:39:23.680 --> 00:39:25.320\nof our front store.\n\n778\n00:39:25.320 --> 00:39:31.200\nAnd there is an element to those categories that today we think about health\n\n779\n00:39:31.200 --> 00:39:32.040\ncare when\n\n780\n00:39:32.040 --> 00:39:34.160\nsomething's raw.\n\n781\n00:39:34.160 --> 00:39:41.040\nAnd we sit here a lot and we think about, well, how do you think about health\n\n782\n00:39:41.040 --> 00:39:41.800\nas it relates\n\n783\n00:39:41.800 --> 00:39:47.210\nto wellness so that we can get in front of why do we only think about health\n\n784\n00:39:47.210 --> 00:39:48.040\ncare when\n\n785\n00:39:48.040 --> 00:39:51.000\nsomething's broke in our bodies?\n\n786\n00:39:51.000 --> 00:39:55.840\nAnd we think about those products, those categories.\n\n787\n00:39:55.840 --> 00:40:00.230\nAnd then we also think about what additional services can we bring to our\n\n788\n00:40:00.230 --> 00:40:01.400\nstores, whether\n\n789\n00:40:01.400 --> 00:40:06.400\nit's the role of our minute clinics and provide for more diagnostic services.\n\n790\n00:40:06.400 --> 00:40:15.920\nSo we'll have 1500 of these health hubs across the country by the end of 2021.\n\n791\n00:40:15.920 --> 00:40:20.710\nAnd from the ones that we have up and running, we're in six or seven markets at\n\n792\n00:40:20.710 --> 00:40:21.880\nthis point.\n\n793\n00:40:21.880 --> 00:40:25.160\nThe feedback from customers has been absolutely terrific.\n\n794\n00:40:25.160 --> 00:40:29.020\nAnd I believe that we're definitely on the right track in terms of needing an\n\n795\n00:40:29.020 --> 00:40:30.840\nunmet need\n\n796\n00:40:30.840 --> 00:40:33.800\nthat exists in the eyes of many of our customers today.\n\n797\n00:40:33.800 --> 00:40:37.890\nYeah, I've always found that if it makes sense from a customer perspective, the\n\n798\n00:40:37.890 --> 00:40:38.440\noperator\n\n799\n00:40:38.440 --> 00:40:40.080\nreally jump on board.\n\n800\n00:40:40.080 --> 00:40:45.070\nAnd that's what sounds like that's happening at CVS, which is great news for me\n\n801\n00:40:45.070 --> 00:40:46.040\nas a consumer.\n\n802\n00:40:46.040 --> 00:40:47.680\nI love it.\n\n803\n00:40:47.680 --> 00:40:55.410\nLarry, speaking of consumer, you and CVS, the experts say that you're really at\n\n804\n00:40:55.410 --> 00:40:56.320\nthe heart\n\n805\n00:40:56.320 --> 00:41:02.880\nof consumerism and healthcare, which is a major, major new happening.\n\n806\n00:41:02.880 --> 00:41:08.480\nHow do you go about really identifying consumer needs and gaps and innovating?\n\n807\n00:41:08.480 --> 00:41:10.560\nBecause you're doing a heck of a lot of it.\n\n808\n00:41:10.560 --> 00:41:15.080\nWell, David, a lot of that is we spend a lot of time listening to our customers\n\n809\n00:41:15.080 --> 00:41:15.320\n.\n\n810\n00:41:15.320 --> 00:41:20.730\nAnd look, I've learned through success and failure that you've really got to be\n\n811\n00:41:20.730 --> 00:41:21.240\na good\n\n812\n00:41:21.240 --> 00:41:26.800\nlistener because our customers, they won't tell us what to do.\n\n813\n00:41:26.800 --> 00:41:32.010\nBut if you listen and ask the questions the right way, they'll sure give you an\n\n814\n00:41:32.010 --> 00:41:32.520\nawful\n\n815\n00:41:32.520 --> 00:41:36.280\nlot of insights about what they don't like and what they're frustrated with.\n\n816\n00:41:36.280 --> 00:41:40.850\nAnd it becomes our job to take those listening skills to learnings and the\n\n817\n00:41:40.850 --> 00:41:43.400\nlearnings to solutions.\n\n818\n00:41:43.400 --> 00:41:46.880\nAnd that's what we've tried to do, what we're working to do in terms of\n\n819\n00:41:46.880 --> 00:41:47.960\nunderstanding what\n\n820\n00:41:47.960 --> 00:41:49.760\nthose unmet needs are.\n\n821\n00:41:49.760 --> 00:41:51.280\nAnd then bringing solutions.\n\n822\n00:41:51.280 --> 00:41:57.760\nNow, the other thing that is part of that that I get pretty excited about is I\n\n823\n00:41:57.760 --> 00:41:58.400\nthink\n\n824\n00:41:58.400 --> 00:42:04.210\nthe role of data analytics and technology, I describe it as there's this new\n\n825\n00:42:04.210 --> 00:42:05.400\nintersection\n\n826\n00:42:05.400 --> 00:42:11.920\nthat's forming and the opportunity to, as you look at all of that information\n\n827\n00:42:11.920 --> 00:42:12.600\nand how\n\n828\n00:42:12.600 --> 00:42:18.660\nyou can be predictive of, well, wait a minute, something as simple as Larry's\n\n829\n00:42:18.660 --> 00:42:20.000\non a statin\n\n830\n00:42:20.000 --> 00:42:21.720\nfor high cholesterol.\n\n831\n00:42:21.720 --> 00:42:26.320\nAnd he should have had his prescription refilled five days ago.\n\n832\n00:42:26.320 --> 00:42:27.600\nAnd he has it.\n\n833\n00:42:27.600 --> 00:42:29.680\nWe need to find out why.\n\n834\n00:42:29.680 --> 00:42:31.360\nAnd it's amazing what you learn.\n\n835\n00:42:31.360 --> 00:42:34.600\nHigh cholesterol is largely asymptomatic.\n\n836\n00:42:34.600 --> 00:42:39.240\nSo you hear comments like, I didn't feel any different after than I did before.\n\n837\n00:42:39.240 --> 00:42:41.200\nSo I didn't think it was working.\n\n838\n00:42:41.200 --> 00:42:44.420\nSo why do I want to spend the money for a prescription that's not making a\n\n839\n00:42:44.420 --> 00:42:45.280\ndifference?\n\n840\n00:42:45.280 --> 00:42:49.470\nOr you hear about, well, I started getting cramps in my legs and I didn't like\n\n841\n00:42:49.470 --> 00:42:50.160\nthose side\n\n842\n00:42:50.160 --> 00:42:51.160\neffects.\n\n843\n00:42:51.160 --> 00:42:52.160\nSo I stopped taking it.\n\n844\n00:42:52.160 --> 00:42:56.700\nIt's an opportunity to proactively engage and learn all those different things\n\n845\n00:42:56.700 --> 00:42:57.560\nand separate\n\n846\n00:42:57.560 --> 00:43:02.360\nfact from fiction, all with the goal of, again, helping people stay healthy.\n\n847\n00:43:02.360 --> 00:43:09.110\nSo David, I would say that we're in the early innings of triangulating data\n\n848\n00:43:09.110 --> 00:43:10.400\nanalytics and\n\n849\n00:43:10.400 --> 00:43:11.400\ntechnology.\n\n850\n00:43:11.400 --> 00:43:17.280\nAnd that was really the beauty of what made CBS and Ettna coming together as\n\n851\n00:43:17.280 --> 00:43:18.200\none so powerful\n\n852\n00:43:18.200 --> 00:43:24.460\nthat Ettna has a lot of that information resident about the members that they\n\n853\n00:43:24.460 --> 00:43:25.440\nserve.\n\n854\n00:43:25.440 --> 00:43:30.310\nAnd when you think about the assets that are resident within CBS, that we have\n\n855\n00:43:30.310 --> 00:43:31.400\nan opportunity\n\n856\n00:43:31.400 --> 00:43:35.640\nto face off with those customers because we see them on a regular basis.\n\n857\n00:43:35.640 --> 00:43:39.120\nAnd that gives you a big advantage, big advantage over the long term.\n\n858\n00:43:39.120 --> 00:43:43.020\nWell, everybody talks about Amazon, which is obviously an incredible company\n\n859\n00:43:43.020 --> 00:43:43.480\nand made\n\n860\n00:43:43.480 --> 00:43:46.680\nyou, it's disrupted almost every category.\n\n861\n00:43:46.680 --> 00:43:49.520\nYou know, how do you see countering them?\n\n862\n00:43:49.520 --> 00:43:51.280\nYou've obviously got the bricks and mortar.\n\n863\n00:43:51.280 --> 00:43:55.080\nDavid, we talk about, you know, Bob, how do you make sure that you don't leave\n\n864\n00:43:55.080 --> 00:43:55.600\nany white\n\n865\n00:43:55.600 --> 00:43:57.240\nspace for disruption?\n\n866\n00:43:57.240 --> 00:44:00.560\nAnd some of this goes back to listening to customers.\n\n867\n00:44:00.560 --> 00:44:04.440\nAnd, you know, and you're absolutely right.\n\n868\n00:44:04.440 --> 00:44:09.080\nAmazon has changed the landscape, you know, for many consumers.\n\n869\n00:44:09.080 --> 00:44:16.200\nAnd, you know, and we talk about, you know, so let's use home delivery today.\n\n870\n00:44:16.200 --> 00:44:20.040\nAnd, you know, we think that we've made it, you know, pretty convenient for\n\n871\n00:44:20.040 --> 00:44:20.520\ncustomers\n\n872\n00:44:20.520 --> 00:44:21.520\ntoday.\n\n873\n00:44:21.520 --> 00:44:26.010\nToday, you got more than 70% of the US population lives within, you know, three\n\n874\n00:44:26.010 --> 00:44:26.880\nmiles of the\n\n875\n00:44:26.880 --> 00:44:27.880\nCBS.\n\n876\n00:44:27.880 --> 00:44:31.840\nAnd, you know, a vast majority of our stores have drive-throughs.\n\n877\n00:44:31.840 --> 00:44:36.040\nSo you can, you know, get a prescription without ever getting out of your car.\n\n878\n00:44:36.040 --> 00:44:37.880\nIf that's your priority.\n\n879\n00:44:37.880 --> 00:44:40.800\nWe have mail order services.\n\n880\n00:44:40.800 --> 00:44:42.280\nWe now have home delivery.\n\n881\n00:44:42.280 --> 00:44:46.920\nSo, you know, David, a lot of people have talked about omni-channel.\n\n882\n00:44:46.920 --> 00:44:52.120\nAnd we're sitting here today saying, well, we offer that omni-experience that\n\n883\n00:44:52.120 --> 00:44:52.680\nyou can\n\n884\n00:44:52.680 --> 00:44:57.720\nbe whoever you want to be based on the priority at that point in time.\n\n885\n00:44:57.720 --> 00:45:01.280\nAnd look, we're thinking about the journey that we're on.\n\n886\n00:45:01.280 --> 00:45:04.280\nWe're defining what omni-channel means for health.\n\n887\n00:45:04.280 --> 00:45:06.040\nIf you think about it that way as well.\n\n888\n00:45:06.040 --> 00:45:08.280\nYeah, I love the consumer focus.\n\n889\n00:45:08.280 --> 00:45:09.280\nFantastic.\n\n890\n00:45:09.280 --> 00:45:10.680\nYou know, Larry, this has been so much fun.\n\n891\n00:45:10.680 --> 00:45:13.600\nAnd I want to have a little bit more before I let you go here.\n\n892\n00:45:13.600 --> 00:45:16.080\nI want to do a little lightning round here with you.\n\n893\n00:45:16.080 --> 00:45:17.080\nOkay?\n\n894\n00:45:17.080 --> 00:45:20.760\nSo, what three words would best describe you?\n\n895\n00:45:20.760 --> 00:45:23.120\nThat's passionate.\n\n896\n00:45:23.120 --> 00:45:26.680\nSometimes, well, that'd be four words.\n\n897\n00:45:26.680 --> 00:45:30.560\nI'd say passionate, passionate, impatient and humble.\n\n898\n00:45:30.560 --> 00:45:31.560\nAll right.\n\n899\n00:45:31.560 --> 00:45:37.280\nSo, you could take the place of one person for a day, who would it be?\n\n900\n00:45:37.280 --> 00:45:44.100\nDavid, I grew up in Western Pennsylvania and I had such admiration for Arnold\n\n901\n00:45:44.100 --> 00:45:45.000\nPalmer.\n\n902\n00:45:45.000 --> 00:45:48.600\nAnd I say that because I'm not a good golfer.\n\n903\n00:45:48.600 --> 00:45:50.720\nI like all.\n\n904\n00:45:50.720 --> 00:45:59.420\nBut I see Mr. Palmer as someone who excelled as a professional athlete, but\n\n905\n00:45:59.420 --> 00:46:00.440\nsomeone who\n\n906\n00:46:00.440 --> 00:46:05.000\nalso excelled as a business person and an entrepreneur.\n\n907\n00:46:05.000 --> 00:46:11.770\nAnd someone who never forgot his roots, never forgot where he came from and had\n\n908\n00:46:11.770 --> 00:46:12.760\nexpressed\n\n909\n00:46:12.760 --> 00:46:18.560\nan element of humility that I actually got to meet him once.\n\n910\n00:46:18.560 --> 00:46:21.600\nAnd I got to speak to him for about 10 minutes.\n\n911\n00:46:21.600 --> 00:46:25.280\nAnd at the end of 10 minutes, I felt like I knew him for 20 years.\n\n912\n00:46:25.280 --> 00:46:27.080\nHe made you that comfortable.\n\n913\n00:46:27.080 --> 00:46:34.520\nAnd what would be something that a few people would know about you, Larry?\n\n914\n00:46:34.520 --> 00:46:42.600\nWell, David, I actually was a musician.\n\n915\n00:46:42.600 --> 00:46:46.280\nI actually thought about majoring in music.\n\n916\n00:46:46.280 --> 00:46:53.130\nAnd as I was going through grade school in junior and senior high school, I\n\n917\n00:46:53.130 --> 00:46:53.720\nplayed the\n\n918\n00:46:53.720 --> 00:46:56.320\npiano, the flute.\n\n919\n00:46:56.320 --> 00:46:57.800\nThe saxophone.\n\n920\n00:46:57.800 --> 00:47:00.800\nAnd thoroughly enjoyed it.\n\n921\n00:47:00.800 --> 00:47:06.240\nIt helped pay for part of my college expenses.\n\n922\n00:47:06.240 --> 00:47:12.760\nAnd I still play the piano, but I think back to those days fondly.\n\n923\n00:47:12.760 --> 00:47:18.080\nIt's interesting because I do believe that music taught me discipline.\n\n924\n00:47:18.080 --> 00:47:19.880\nAnd I think a lot about that.\n\n925\n00:47:19.880 --> 00:47:25.480\nDid I remember playing the saxophone for about six months?\n\n926\n00:47:25.480 --> 00:47:30.600\nDo you have a hidden talent?\n\n927\n00:47:30.600 --> 00:47:31.600\nYou know what?\n\n928\n00:47:31.600 --> 00:47:32.760\nI'm not a very good athlete.\n\n929\n00:47:32.760 --> 00:47:35.880\nI'm a wannabe athlete.\n\n930\n00:47:35.880 --> 00:47:40.280\nProbably the music is what I would describe that as my hidden talent.\n\n931\n00:47:40.280 --> 00:47:42.200\nLarry, you've had so much success.\n\n932\n00:47:42.200 --> 00:47:46.220\nBut a lot of leaders have what they would call their epic fail or certainly a\n\n933\n00:47:46.220 --> 00:47:46.920\nfailure.\n\n934\n00:47:46.920 --> 00:47:51.220\nWhat would be your biggest failure that you've had and what did you learn from\n\n935\n00:47:51.220 --> 00:47:51.640\nit?\n\n936\n00:47:51.640 --> 00:47:54.440\nYou know what, David, there's two things that come to mind.\n\n937\n00:47:54.440 --> 00:47:59.000\nAnd we talked a lot about listening to our customers.\n\n938\n00:47:59.000 --> 00:48:04.980\nAnd I could remember, oh, God, this is probably maybe 20 years ago, maybe even\n\n939\n00:48:04.980 --> 00:48:06.040\na little further\n\n940\n00:48:06.040 --> 00:48:07.040\nthan that.\n\n941\n00:48:07.040 --> 00:48:13.360\nWe saw one of our competitors opening up drive-through windows for the pharmacy\n\n942\n00:48:13.360 --> 00:48:13.400\n.\n\n943\n00:48:13.400 --> 00:48:17.040\nAnd I can remember saying, well, we can't do that.\n\n944\n00:48:17.040 --> 00:48:18.560\nWell, what do you mean we can't do that?\n\n945\n00:48:18.560 --> 00:48:23.600\nWell, if they go through the drive-through, they won't come inside the store.\n\n946\n00:48:23.600 --> 00:48:27.050\nAnd the learning from that was, well, look, if they want to use the drive-\n\n947\n00:48:27.050 --> 00:48:27.720\nthrough and\n\n948\n00:48:27.720 --> 00:48:30.630\nyou don't have it, then they're not going to come to the store anyway because\n\n949\n00:48:30.630 --> 00:48:31.040\nthey're\n\n950\n00:48:31.040 --> 00:48:33.640\ngoing to go to somebody who does.\n\n951\n00:48:33.640 --> 00:48:39.820\nAnd that was an important learning that if you've got to meet the needs of the\n\n952\n00:48:39.820 --> 00:48:40.280\nconsumer\n\n953\n00:48:40.280 --> 00:48:44.570\nor they'll find someone who does, then the second thing that comes to mind in\n\n954\n00:48:44.570 --> 00:48:46.080\nthat is\n\n955\n00:48:46.080 --> 00:48:50.920\nwe talk a lot about innovation.\n\n956\n00:48:50.920 --> 00:49:00.440\nAnd I think that this is probably a bigger issue than an individual failure.\n\n957\n00:49:00.440 --> 00:49:05.600\nAs an organization, we would sit here and talk, we have a wonderful culture.\n\n958\n00:49:05.600 --> 00:49:09.240\nBut why are we so slow at innovating?\n\n959\n00:49:09.240 --> 00:49:15.950\nAnd what we realized was, well, there's fear of failure because of our culture\n\n960\n00:49:15.950 --> 00:49:16.640\ngets in\n\n961\n00:49:16.640 --> 00:49:20.610\nthe way of our culture supports that kind of success and people want to do the\n\n962\n00:49:20.610 --> 00:49:21.000\nright\n\n963\n00:49:21.000 --> 00:49:22.480\nthings.\n\n964\n00:49:22.480 --> 00:49:25.840\nBut we haven't made it easy for people to fail.\n\n965\n00:49:25.840 --> 00:49:33.480\nAnd years ago, David, we talked a lot about that as an organization.\n\n966\n00:49:33.480 --> 00:49:39.400\nAnd I still remember in a town hall meeting where we gave an award to someone\n\n967\n00:49:39.400 --> 00:49:40.360\nwho failed\n\n968\n00:49:40.360 --> 00:49:42.400\non a project.\n\n969\n00:49:42.400 --> 00:49:45.520\nAnd you could have heard a pin drop in the room.\n\n970\n00:49:45.520 --> 00:49:50.240\nAnd it was symbolic of what I was just describing.\n\n971\n00:49:50.240 --> 00:49:54.650\nAnd we talked about the learnings from that failure and how that failure was\n\n972\n00:49:54.650 --> 00:49:55.240\nreally a\n\n973\n00:49:55.240 --> 00:49:56.240\nsuccess.\n\n974\n00:49:56.240 --> 00:50:00.470\nAnd that was really where we started talking about that if we're not failing on\n\n975\n00:50:00.470 --> 00:50:02.120\nsome things,\n\n976\n00:50:02.120 --> 00:50:04.200\nwe're not pushing the envelope enough.\n\n977\n00:50:04.200 --> 00:50:11.030\nAnd we'll celebrate failure as long as we meet three criteria, fail fast, fail\n\n978\n00:50:11.030 --> 00:50:12.240\ncheaply,\n\n979\n00:50:12.240 --> 00:50:14.840\nand fail on something new.\n\n980\n00:50:14.840 --> 00:50:17.760\nAnd I'm happy to say that we've gotten better.\n\n981\n00:50:17.760 --> 00:50:22.680\nAlthough, David, we talked about the pandemic a minute ago.\n\n982\n00:50:22.680 --> 00:50:28.310\nAnd one of the things that we just did this as a leadership team about a week\n\n983\n00:50:28.310 --> 00:50:29.120\nago, and\n\n984\n00:50:29.120 --> 00:50:34.690\nI said earlier, I couldn't have been prouder of our organization in terms of\n\n985\n00:50:34.690 --> 00:50:35.320\nhow folks\n\n986\n00:50:35.320 --> 00:50:36.320\nstepped up.\n\n987\n00:50:36.320 --> 00:50:40.430\nBut one of the things that I know several of our senior leaders spoke up and\n\n988\n00:50:40.430 --> 00:50:41.600\nsaid, \"Man,\n\n989\n00:50:41.600 --> 00:50:45.960\nwe were quick in terms of making decisions and moving.\"\n\n990\n00:50:45.960 --> 00:50:49.360\nAnd someone made the comment that, \"You know what?\n\n991\n00:50:49.360 --> 00:50:54.480\nWe rolled out things that they weren't fully baked.\n\n992\n00:50:54.480 --> 00:51:01.170\nWe had a 75%, 80% solution, and we knew it, but we went with it anyway, and we\n\n993\n00:51:01.170 --> 00:51:01.880\niterated\n\n994\n00:51:01.880 --> 00:51:04.520\nthe balance along the way.\"\n\n995\n00:51:04.520 --> 00:51:09.550\nAnd there was a really good learning that came from that, that if we had waited\n\n996\n00:51:09.550 --> 00:51:10.040\nto get\n\n997\n00:51:10.040 --> 00:51:17.010\nit to 90 or 95%, then we perhaps would have missed meeting the need of\n\n998\n00:51:17.010 --> 00:51:18.400\nconsumers.\n\n999\n00:51:18.400 --> 00:51:21.680\nAnother big issue in our country today is opioids.\n\n1000\n00:51:21.680 --> 00:51:24.480\nAnd you've taken the lead on this front as well.\n\n1001\n00:51:24.480 --> 00:51:33.600\nYeah, David, it's, we've all seen the pain and frustration around that.\n\n1002\n00:51:33.600 --> 00:51:37.760\nIt's a situation that doesn't discriminate.\n\n1003\n00:51:37.760 --> 00:51:41.200\nIt's in the cities, it's in the suburbs, it's in rural America.\n\n1004\n00:51:41.200 --> 00:51:46.650\nAnd this is a good example of, I remember one of the first things that we did\n\n1005\n00:51:46.650 --> 00:51:47.160\nwas empty\n\n1006\n00:51:47.160 --> 00:51:49.160\nout your medicine cap.\n\n1007\n00:51:49.160 --> 00:51:51.520\nAnd we didn't know what to expect when we did that.\n\n1008\n00:51:51.520 --> 00:51:54.640\nWe were doing these drug take-back programs.\n\n1009\n00:51:54.640 --> 00:52:01.470\nAnd all of a sudden, the quantities that were coming back, it was like, \"Well,\n\n1010\n00:52:01.470 --> 00:52:01.920\nby the time\n\n1011\n00:52:01.920 --> 00:52:06.590\nwe empty every medicine cabinet in America, it'll be time to start over again\n\n1012\n00:52:06.590 --> 00:52:07.200\nbecause\n\n1013\n00:52:07.200 --> 00:52:08.760\nwe haven't solved for it.\n\n1014\n00:52:08.760 --> 00:52:12.400\nIt kind of gets back to what's the problem that we're solving for?\"\n\n1015\n00:52:12.400 --> 00:52:16.860\nAnd at the time, we didn't have a solution for why is this product getting in\n\n1016\n00:52:16.860 --> 00:52:17.640\nthe medicine\n\n1017\n00:52:17.640 --> 00:52:20.000\ncap that they begin with?\n\n1018\n00:52:20.000 --> 00:52:25.930\nAnd when we realized that, we went back and one of the things that we found and\n\n1019\n00:52:25.930 --> 00:52:26.400\nprobably\n\n1020\n00:52:26.400 --> 00:52:30.740\neverybody has an example about that whether it's going to the dentist or\n\n1021\n00:52:30.740 --> 00:52:31.800\nsomebody has an\n\n1022\n00:52:31.800 --> 00:52:39.280\nacute injury and they walk away with a prescription for 30 or 60 pain pills.\n\n1023\n00:52:39.280 --> 00:52:48.260\nAnd the reality is they might need six or eight because it's a cute short-term\n\n1024\n00:52:48.260 --> 00:52:48.960\npain.\n\n1025\n00:52:48.960 --> 00:52:53.720\nAnd those unused quantities is what was ending up in the medicine cabinet.\n\n1026\n00:52:53.720 --> 00:52:59.550\nAnd unfortunately, those were becoming a source for how people were entering\n\n1027\n00:52:59.550 --> 00:53:00.720\nthe opioid world\n\n1028\n00:53:00.720 --> 00:53:01.880\nto begin with.\n\n1029\n00:53:01.880 --> 00:53:09.630\nSo one of the actions that we took is if someone was new to therapy, we were\n\n1030\n00:53:09.630 --> 00:53:10.800\nnot going\n\n1031\n00:53:10.800 --> 00:53:15.760\nto dispense any more than a seven-day supply.\n\n1032\n00:53:15.760 --> 00:53:23.420\nAnd look, over the last several years, we've seen a dramatic decrease in both\n\n1033\n00:53:23.420 --> 00:53:24.560\nthe number\n\n1034\n00:53:24.560 --> 00:53:30.480\nas well as the quantity of opioid prescriptions that we have dispensed.\n\n1035\n00:53:30.480 --> 00:53:34.920\nAnd look, we think that that's made a meaningful improvement.\n\n1036\n00:53:34.920 --> 00:53:38.680\nBut look, we still have a lot of work to do there.\n\n1037\n00:53:38.680 --> 00:53:40.880\nOur pharmacists have gone into communities.\n\n1038\n00:53:40.880 --> 00:53:46.030\nWe've gone in and done our pharmacists have gone into schools and have now\n\n1039\n00:53:46.030 --> 00:53:46.880\ntouched more\n\n1040\n00:53:46.880 --> 00:53:50.820\nthan a half a million students in terms of talking about the dangers of\n\n1041\n00:53:50.820 --> 00:53:51.760\nprescription\n\n1042\n00:53:51.760 --> 00:53:52.760\ndrug abuse.\n\n1043\n00:53:52.760 --> 00:53:53.760\nThat's great.\n\n1044\n00:53:53.760 --> 00:53:58.140\nWell, Larry, one thing for sure, you have a tremendous talent of building a\n\n1045\n00:53:58.140 --> 00:53:58.960\ntremendous\n\n1046\n00:53:58.960 --> 00:53:59.960\nbusiness.\n\n1047\n00:53:59.960 --> 00:54:06.350\nAnd I don't know of anybody who's grown their business $150 billion in revenue\n\n1048\n00:54:06.350 --> 00:54:06.760\nin nine\n\n1049\n00:54:06.760 --> 00:54:07.760\nyears.\n\n1050\n00:54:07.760 --> 00:54:09.360\nThat's really something.\n\n1051\n00:54:09.360 --> 00:54:11.120\nSo hats off.\n\n1052\n00:54:11.120 --> 00:54:13.640\nJust one last question here.\n\n1053\n00:54:13.640 --> 00:54:17.380\nWhat would you say about your upbringing and just your personal family\n\n1054\n00:54:17.380 --> 00:54:20.240\nsituation that\n\n1055\n00:54:20.240 --> 00:54:24.040\nis really driving who you are today?\n\n1056\n00:54:24.040 --> 00:54:28.160\nDavid, I think about my upbringing.\n\n1057\n00:54:28.160 --> 00:54:33.680\nAnd I was fortunate to be the first member of my family to go to college.\n\n1058\n00:54:33.680 --> 00:54:38.850\nAnd my parents, they taught me the value of a strong work ethic and the value\n\n1059\n00:54:38.850 --> 00:54:39.760\nassociated\n\n1060\n00:54:39.760 --> 00:54:42.400\nwith being a good human being.\n\n1061\n00:54:42.400 --> 00:54:44.640\nI've always worked hard to do that.\n\n1062\n00:54:44.640 --> 00:54:50.530\nAnd I think embedded in there is it was something that struck me back to\n\n1063\n00:54:50.530 --> 00:54:52.160\nspeaking about Arnold\n\n1064\n00:54:52.160 --> 00:54:53.160\nPalmer.\n\n1065\n00:54:53.160 --> 00:54:58.360\nAnd one of those things I believe in is don't forget where you came from.\n\n1066\n00:54:58.360 --> 00:55:04.790\nAnd in thinking about individuals that had an impact on your life, whether it's\n\n1067\n00:55:04.790 --> 00:55:05.240\nin your\n\n1068\n00:55:05.240 --> 00:55:10.410\nbusiness life or your personal life, and the responsibility that we have as\n\n1069\n00:55:10.410 --> 00:55:11.360\nadults and\n\n1070\n00:55:11.360 --> 00:55:14.280\nas business leaders to pay that forward.\n\n1071\n00:55:14.280 --> 00:55:18.200\nAnd my wife and I have one child and we're proud of her as well.\n\n1072\n00:55:18.200 --> 00:55:21.320\nAnd I see those values in her as well.\n\n1073\n00:55:21.320 --> 00:55:24.280\nSo that's something that I take a lot of pride in.\n\n1074\n00:55:24.280 --> 00:55:25.280\nWell, fantastic.\n\n1075\n00:55:25.280 --> 00:55:28.320\nLarry, you know, this has just been amazing.\n\n1076\n00:55:28.320 --> 00:55:31.880\nAnd thank you for sharing your insights with other leaders.\n\n1077\n00:55:31.880 --> 00:55:33.600\nThere's so much we can all learn.\n\n1078\n00:55:33.600 --> 00:55:34.800\nSo thank you very much.\n\n1079\n00:55:34.800 --> 00:55:36.480\nNow, David, enjoy doing it.\n\n1080\n00:55:36.480 --> 00:55:46.480\nEnjoy the discussion.\n\n1081\n00:55:46.480 --> 00:55:50.300\nYou know, I can't think of a better example of how a simple and compelling\n\n1082\n00:55:50.300 --> 00:55:51.520\npurpose transformed\n\n1083\n00:55:51.520 --> 00:55:53.160\na company.\n\n1084\n00:55:53.160 --> 00:55:55.080\nBut it just didn't happen.\n\n1085\n00:55:55.080 --> 00:56:00.040\nLarry first had to throw out the convoluted missions and visions of the past.\n\n1086\n00:56:00.040 --> 00:56:04.400\nHe had to dial in to something simple and compelling, something people could\n\n1087\n00:56:04.400 --> 00:56:05.200\nreally get\n\n1088\n00:56:05.200 --> 00:56:09.850\non board with and something that people could relate to and make tough\n\n1089\n00:56:09.850 --> 00:56:11.560\ndecisions and actually\n\n1090\n00:56:11.560 --> 00:56:14.440\nbring that purpose statement to life.\n\n1091\n00:56:14.440 --> 00:56:17.560\nThis week is part of your weekly personal development plan.\n\n1092\n00:56:17.560 --> 00:56:20.200\nI want you to do something a little scary.\n\n1093\n00:56:20.200 --> 00:56:24.720\nI want you to just stop casually in the hall or ping some of your people on\n\n1094\n00:56:24.720 --> 00:56:25.640\nSlack and just\n\n1095\n00:56:25.640 --> 00:56:30.920\nask them, hey, without looking it up, what's our organization's purpose?\n\n1096\n00:56:30.920 --> 00:56:34.720\nOr ask them, what's the purpose of our team?\n\n1097\n00:56:34.720 --> 00:56:40.240\nAsk a few more people, listen to their responses and then see for yourself how\n\n1098\n00:56:40.240 --> 00:56:41.040\nwell or maybe\n\n1099\n00:56:41.040 --> 00:56:46.210\nhow not so well your vision is coming through to your team and your\n\n1100\n00:56:46.210 --> 00:56:47.760\norganization.\n\n1101\n00:56:47.760 --> 00:56:51.840\nYou might find there's an opportunity to simplify your organization's vision\n\n1102\n00:56:51.840 --> 00:56:53.640\nand purpose too.\n\n1103\n00:56:53.640 --> 00:56:58.070\nAnd hey, like CVS Health, there may be a whole new level of success waiting for\n\n1104\n00:56:58.070 --> 00:56:58.280\nyou\n\n1105\n00:56:58.280 --> 00:56:59.920\nout there when you do.\n\n1106\n00:56:59.920 --> 00:57:02.080\nSo do you want to know how leaders lead?\n\n1107\n00:57:02.080 --> 00:57:06.140\nWhat we learned today is the great leaders craft a simple and compelling\n\n1108\n00:57:06.140 --> 00:57:06.960\npurpose that\n\n1109\n00:57:06.960 --> 00:57:10.480\ntheir people can actually act upon.\n\n1110\n00:57:10.480 --> 00:57:14.680\nThanks again for tuning in to another episode of how leaders lead where every\n\n1111\n00:57:14.680 --> 00:57:15.600\nThursday you\n\n1112\n00:57:15.600 --> 00:57:20.000\nget to listen in while I interview some of the very best leaders in the world.\n\n1113\n00:57:20.000 --> 00:57:23.850\nI may get a point to give you something simple on each episode that you can\n\n1114\n00:57:23.850 --> 00:57:24.640\napply to your\n\n1115\n00:57:24.640 --> 00:57:28.440\nbusiness so that you will become the best leader you can be.\n\n1116\n00:57:28.440 --> 00:57:38.440\n[BLANK_AUDIO]\n\n1117\n00:57:38.440 --> 00:57:48.440\n[BLANK_AUDIO]","

David Novak 0:04

Welcome to How leaders lead where every week you get to listen in while I interview some of the very best leaders in the world, I break down the key learning so that by the end of the episode, you'll have something simple that you can apply as you develop into a better leader. That's what this podcast is all about. And today's guest is Larry mirlo, CEO of CVS Health, Larry is just an incredible leader. And when he took the helm of CVS in 2011, they were doing about $100 billion in revenue. Now, that's a lot of money. But guess what, now they're doing almost $250 billion in revenue. That's just a remarkable level of growth. But it's not the most remarkable thing Larry has done. He also made the bold and honestly risky decision to remove tobacco products from CVS stores. And he did that even though they accounted for $2 billion of revenue, he'll tell you the whole story. And it's incredible. But I really want you to listen for why he and his team made that decision in the first place. It came from a very simple statement of the purpose of their company, literally eight words, and it changed everything for them. As leaders, we all need the reminder, the best vision in the world ain't worth a lick. If our team can't connect with it and apply it each and every day. This conversation with Larry shows us just how to communicate our big ideas in simple compelling terms. So here's my conversation with my good friend, and soon to be yours, Larry mirlo.

Well, Larry, I appreciate you being on this show so much. And you know what I was, I know, I've been looking at your career, you know, you became CEO nine years ago. And back then, and CVS I think, had a little over $100 billion in revenue. And today, it's $265 billion dollars, you now have over 300,000 employees, and you're number five on the fortune 500 list. And to think you started out as a pharmacist, tell us about that journey? Well, as

Larry Merlo 2:19

David did, it brings back a lot of memories I grew up in up in a small mill town, there was actually a Corning Glass Works plant that most people worked at, if they didn't work there, they worked at the wheeling Pittsburgh steel plant across the river. And I loved music, I loved chemistry. And I actually had a high school chemistry teacher that I think the world of to this day, and he actually steered me in the direction of pharmacy. Larry, if you if you liked chemistry in any like medicine, you know, think about pharmacy as a career. And off I went to the University of Pittsburgh and and in five years later graduated as a pharmacist,

David Novak 3:02

you moved up the ladder from pharmacist to CEO. How do you distinguish yourself and show that you had broader potential?

Larry Merlo 3:09

That's a great question. And, you know, oftentimes you get that question. Well, when you started, did you have aspirations to be CEO? And my answer was no, I really had aspirations to be the very best pharmacist. And as you got into that environment, you saw opportunities for growth. And I had always set my goal in terms of Well, I went from being a pharmacist to getting into management and field management and operations. And I think one of the things that helped shape my learnings is that I was never afraid to raise my hand for a special assignment. And maybe it didn't result in a promotion. But it actually took me out of my comfort zone. And through the various experiences that I had. It actually taught me about things that were not core, to my experience or my background. And I think a lot about that. And, and I think if I didn't have had those opportunities, or took advantage of them, I I don't see myself being in the role that I'm in today.

David Novak 4:13

Did you have Larry, when you were taking on those special assignments? Did you have one of those that really sort of changed your career trajectory.

Larry Merlo 4:21

When I graduated from pharmacy school, I went to work for a drug chain that many will remember in the Washington DC area called people's drug. It was actually founded in 1904. And this is now 1978 and had a wonderful experience there. And 12 years later was CVS actually acquired the people's drug chain. That's, you know, that's how I got the CVS and through consolidation activities, which we can all appreciate. I found myself as the most senior person that remained in the Washington DC area. And that dynamic really helped you know, shape. I would just ascribe my leadership because now I recognize that okay, we were part of this new company, there were many things that CBS did differently than than people's many things that were very positive and some things that, you know, this isn't going to work in the Washington DC market. And I found myself playing that role, that leadership role in terms of how do I help educate my boss and our new owners in terms of things that I think may be contradictory to that particular marketplace, and at the same time, provide leadership for to time about 10,000 of our new CBS colleagues in terms of the leadership that they needed in terms of how are they going to accept some of the changes, that we weren't all going to be better as a result of what we were collectively doing is as a leadership team. So, you know, I learned an awful lot from that.

David Novak 5:58

Well, you certainly have a company now that requires integration. I want to get to that a little bit later. But, you know, I know you, you really think a lot about leadership. Larry, can you tell us a couple stories about your personal guiding principles of leadership? Because I you know, I understand that, you know, doing a little homework that you actually have 10 guiding principles, we don't have time for 10. But do you have a couple stories on on a few of the main ones that you could share with us?

Larry Merlo 6:25

Yeah. And you brought up the the 10. And when I became CEO, that was back in, in, in early 2011. And I still remember, it was a Sunday night. And, and I'm thinking a lot about, you know, how do I get started, it's an organization that I know, and, and it's an organization that our colleagues know, know me and who I am. But obviously, I was succeeding, a very successful individual. My predecessor had been in that role for more than 15 years, and was very well respected across the organization, and how do I get our colleagues to see me in a different light as the CEO? And that was the question that I was really wrestling with. And I still remember that Sunday evening, just scribbling a whole bunch of random thoughts. And those thoughts ended up being 10 things that I believe in, that I think have helped shape me as a leader. And, and David, one of those stories is I think about finding the sweet spot between being student and being a teacher. And, and I think the higher you, you move up in any organization, I think there's an expectation that you have all the answers. And the reality is as the CEO, you don't, and I believe a strong leader takes pride in being both a student and a teacher, and being that student means that you're displaying humility, okay. And at the same time, you're a good listener. And it's something that I have really tried to stay true to. And sometimes it's hard because in times of crisis, people do expect you well, Larry's going to have the answer. He's going to know exactly what we need to do. And there are times when you have to turn around it and acknowledge that look, I don't have the answer. But here's what we need to solve for. And here's how we're going to go about doing that. And I have found that that guiding principle has, you know, has served me and I believe served our organization very well.

David Novak 8:28

That's fantastic. You know, I just love that I love the fact that you codified your 10 principles to the students, teachers way how you can solve problems, you know, how do you how do you take your team through solving a major, major problem? What's your perspective on problem solving?

Larry Merlo 8:43

I think oftentimes, and look, I'll raise my hand, you know, I've made the mistake that sometimes you see the problem in front of you, and let's move quickly, being action oriented. And I've made the mistake sometimes in terms of the desire to, to deal with or to solve whatever issue is on the table that everybody jumps in with both feet, and you later realize you solved for the wrong problem. And we talk a lot about look, take a deep breath, take a few minutes and make sure that we understand the problem that we really need to solve for. And then the second step is how do you define the guiding principles in terms of going about that, because one of the things that I've come to appreciate there's so many things that come across our desk that perhaps the playbook has not been written, and you're charting a new, a new path forward. That's especially true at CVS is as as we have worked to reinvent ourselves and change our business model to be more not be more be a health services company. And we spend a lot of time what are the guiding principles that we will move forward to solve whatever is on the table and we use those guiding principles as our guideposts kind of our roadmap that as we're dealing with the unknown, I find myself oftentimes going back to those guiding principles. And how many of those Can I check the box on? And and, you know, if, if the answer is none, then that tells me, I'm on the wrong road. Okay? If the answer is no, you know, what, I might not have checked every box, but I'm moving down the right road, and let's keep going.

David Novak 10:26

I love that idea of, of taking a deep breath. There's so many times I could tell you, when I just went charge that I had needed to take a little bit of a timeout, when you became CEO, and a lot of us we get into these new jobs, what was the biggest anxiety you had to work through when you became the new CEO?

Larry Merlo 10:48

You know, I think one of the things that, that we wrestled with, and and some of this goes back to what we were just talking about, in terms of our evolving strategy as a health services company, I remember, you know, sitting down and looking at, at the time, we had our mission statement, and our vision statement, is, I think back on that, you know, we made the mistake of involving the consultants and and, look, there are times where consultants are invaluable. And there are times where, you know, what, you don't need a consultant. And if you're gonna do it, right, you need to do it from within. And we had these very carefully worded paragraphs. And when you read them, it felt like we were solving for world hunger. And I can remember one of the very first leadership meetings that we had, we had about 400 people in the room, and, and I put up the two paragraphs, and I asked everyone, which one is the mission? Which one is the vision, you got a 50% chance of getting it? Right, and back, then we were using our phones to, to do the question, okay. And that's exactly what we got, when 50% of the people got it. Right. Okay. And, you know, and I still remember that meeting, making a commitment that, look, this is the last time you're going to see this mission, and this vision, because we haven't been able to operationalize it in terms of bringing, you know, day to day meaning to our work. And, you know, if we can't answer that question is the leadership of the company, then, how good a job are we doing leading the 1000s of individuals that are counting on us, okay, for that level of, of leadership and focus and direction. So we took a very small group of our colleagues, and we said, here's the challenge. And they did an absolute fantastic job, they came back and said, Larry, we need a purpose. And that purpose is one sense. And this was back in 2011. And, and that purpose, that it still stands to this day, that our purpose as a company is helping people on their path to better health. And so something it's simple, you know, it's understood by everyone and David I, I knew that we that we hit the mark. And, you know, I was, you know, visiting our stores. And as I still remember this, vividly, we were in Long Island, and walked into the store with the region manager. And I had observed one of our, one of our colleagues was helping an elderly customer taking bags up to her car. So our employee comes back, and I introduced myself and, and I said, Look, I just want to take a minute to thank you, I said, I observed what you were doing in terms of that was great, and thank them and, and the employee said to me, Well, it's my way of helping people on their path to better health. Okay, now, this was someone who wasn't working in the pharmacy, they were working in what we call the front of store, and they were able to internalize what those words meant as to the job that they were doing every day. And I tell that story often because helping people on their path to better health, someone thinks, well, if I'm not filling a prescription or seeing a patient in one of our clinics, or some of the other health related areas where you are providing health advice or health care treatment, and there are countless examples out there like that, where people have internalized that in in very meaningful ways.

David Novak 14:32

I love the fact that you talked about the consultants had the first one, you know, it was all laminated, but nobody really could internalize it. It's really interesting because I think the great visions are ones that you can understand and then people can personalize it like you say and say this is how I can make it happen. And at my piece of CVS health, so I can see how that really works. You know, Larry, great leaders have to make courageous calls. And, you know, tell us the story of how you made this I remember hearing this actually it was in, in my own boardroom and people were talking about it. And it was in the Wall Street Journal, if you became the first major retailer to take tobacco products out of your stores, tell us how you thought through that whole process. Yeah,

Larry Merlo 15:15

we talked earlier about our longer term strategy was we wanted to be more of a health care company. And that was being defined. And there were things that we were doing, whether it was opening, what today is called medic clinics in our stores, or some of the things we were doing in, in our pharmacies that went beyond just filling a prescription. And we now owned a pharmacy benefit management company and the synergy that could be created across those two businesses. And I can remember going to several meetings with various health professionals that could have been an integrated delivery system. And in would be talking about some of the things we could do, you know, recognizing our local presence and the fact that we would see millions of customers every day in our in our retail pharmacies, and we would be having great conversations and halfway, two thirds of the way through the conversation, someone would speak up and say, well, where but CVS sells tobacco. Right. And that drum be it played out more times than not in those meetings. And, and David, what I found was the enthusiasm and the energy that was in the room, when that question got asked, it just sucked all the air out of the room, you felt like you wanted to crawl under the table. And oftentimes the meetings ended with thanks for coming. And that was a very interesting conversation. And the follow up was, yeah, we were really never able to get any momentum from those from those discussions. And I could remember, coming back among our, our leadership team, and we started talking about that. And at the time, we generated about $2 billion of revenues. And what we were looking at was, there was about a billion and a half of tobacco sales. And then, as we looked at what else did folks buy, as part of a purchasing a pack of cigarettes? You would see gum or, or immense? And, yeah, and the reality was, you could see that those purchases, people were thinking of us more as a convenience store. So there was $2 billion worth of revenues at stake. But we were having the discussion that look, here's our strategy, here's our long term strategy, this absolutely has proven to be a barrier in terms of getting any traction, I remember, we put a whole presentation together, we very quietly went out and surveyed some health professionals. And the one thing that I was extremely concerned about is that hopefully everyone is you know, shopped at a CVS pharmacy, but we sell candy, we sell chips, we sell soda, and and and we even sell, you know, spirits and alcohol in states where it's permitted. And I was concerned in terms of, well, if we stopped selling tobacco, where would it stop? Would it spill into those products? And, and I did get comfortable in talking to health professionals. When you asked that question, they turned around and said, Larry, stop right there. There is no amount of tobacco use that could be considered safe. The other products that you rattled off, yes, there are challenges in our society around obesity. But those products taken in moderation, have not been proven to cause the medical harm that tobacco does. And they were essentially saying, We got your back on that. I remember going to our board. And that was a very, very sleepless night before that board.

David Novak 18:45

And I can imagine $2 billion in revenue.

Larry Merlo 18:48

And, you know, as you might expect, I had socialized the thought with some of the, I'll say the key leaders on our board and had gotten their feedback. And, and David, it's probably a board meeting that I'll never forget, because the support from the board was unprecedented. It ended up becoming a very quick conversation. And I still remember one of our board members saying, Larry, look, it's the right thing to do. And one of the things that I want to emphasize is don't be shy about telling the story. Just go out there and you've got nothing to be embarrassed about in terms of walking away from $2 billion, you'll you'll be challenged, the investor community will scratch their head. Okay, and you're going to talk about our journey as a health care company. I vividly remember not just that meeting, but what transpired shortly after because we put the plan together. And I remember it was in February of 2014, where we did some embargoed interviews with the key newspapers across the country. And there was myself our chief medical officer, our our Head of Marketing and you know And after the second or third interview, I remember asking folks, I said, Hey, there's a theme that's emerging here. And it didn't matter who we were talking to at the end of the interview, the reporter wanted to tell you their story about how tobacco impacted their life. And it usually involves a family member. And they told the story like it happened yesterday, even though it could have happened 1015 20 years ago, we were able to take that thought, both internally and externally with our employees, as well as the communities at large in terms of tell us your story. And you know, and that accompanied with programs that we put in place in terms of how we can help people who wanted to stop using tobacco products, it takes an individual on average, seven times before they're successful in terms of kicking that tobacco habit. There was a tremendous outpouring of, you know, our employees, the communities at large in terms of support for that decision. And as I look back on that, it, it's, it's one of the, you know, it'll be one of the highlights of my career, because it removes that barrier. And I look at all the things that we've been able to do as a healthcare company since 2014. That I think back and I I'm confident that I know, many of those doors would never have been opened, have we not made that decision?

David Novak 21:29

When did you make the decision, Larry to go to CVS health?

Larry Merlo 21:33

You know, David, we we made the decision shortly thereafter, because it was interesting, we made the announcement in in February 14, as I mentioned, at the time, we had about 7600 stores. So we said we need six months to eliminate tobacco from our stores, we were going to you know, sell down the inventory, etc, etc. And based on the reaction that we got out of the gate, our corporate identity at the time was CVS Caremark which there was nothing that resonated to the consumer about that name. And we said, You know what, from the reaction that we got the learnings that we've got, there is an opportunity to rebrand the company as more of a health company recognizing that that was the journey that we had begun. Eliminating tobacco was another step in that journey. And there was a lot of things that we also began to do. We had a five year program that we launched, called Be the first our goal working with community partners to create the first tobacco free generation. And we've got a lot of proof points that have demonstrated the progress that we've made there. But six months later, actually, five months later, because it was September 3 2014, that we announced that we were tobacco free. And as part of that announcement, we announced our new corporate names cbsl.

David Novak 22:56

Great, that's that's a great story. You know, you talked about how everybody has a personal story with tobacco. I understand that you you have a personal story. Your father died from cancer, that's cigarette related disease.

Larry Merlo 23:08

Yeah, David, he was my father passed away. At a young age, he was 57. He had cancer, he worked in the glass factory, and he chewed tobacco during the day. And he smoked cigars in the evening. So he either had a chew going, okay, or that cigar was, was attached to his lips, whether it was lit or not. And what he was wonderful individual. And I regret the fact that he died at such a young age and the time that that took away from the two of us being able to spend time together as myself as a young adult. And think about them often.

David Novak 23:46

Yeah, I'm sure you do, you know. And now, Larry, as you've evolved as a health services company, you've got a really interesting model. It's totally unique in the industry. It's an interconnected model that where you have over 10,000 pharmacies, you've got Aetna Insurance, you've got a pharmacy benefit management company, how are you bringing this whole company together? And what's your vision here?

Larry Merlo 24:12

What the vision is, you know, obviously, everyone sees the challenges that exist in our healthcare system today. It's, it's, it's very, it's very complicated and can be confusing to, to access in and navigate and, and it's become, you know, very costly and, and unfortunately, unaffordable for many, and as we think about how we can change the way care is delivered in the country, we really think about, you know, three imperatives that are associated with that. And, you know, the first one is to make health care local and to meet people where they are, whether it's in their community, in their home or now in the palm of your hand. The second is to make healthcare simple, and we believe that we can provide Get the information and the navigation so people can can access what they need and the resources that they need to make an informed decision. In the third, and we think about this one, David is being our Northstar, and go back to that purpose of helping people on their path to better health. And, you know, you look at today that we got about two thirds of our country that has one or more chronic diseases, we know their names, you know, it's hypertension, cardiovascular, diabetes, asthma. And there are eight or nine of those chronic diseases that are accounting for anywhere from 75 to 80%, of all health care costs. And yet, those individuals with chronic disease are not achieving their their best health outcome. And I was sharing this story with with someone and they stopped me in the middle of it. And they said, Larry, it sounds like you want to cure diabetes. And I said, Well, we're not going to be able to cure diabetes. So we'll leave that to the researchers. But we can help the 30 plus million individuals today that have diabetes, we can help them achieve their best health, making sure that they're staying adherent to their medications, they're getting their the appropriate frequency of blood testing, that they're following the instructions that they may have around diet, nutrition and exercise. And in David, we look at it our healthcare system today that that individual may be visiting their physician on a quarterly basis. And it may be it's even less frequent, and they leave with that care plan. And the system fails, way too many people because no one knows if that care plan is being followed until an unintended consequence happens. And at that point, we would sit here and say it's too late. So those are the imperatives that we have, you know, as an organization to change the trajectory of care and, and in doing so help people achieve a better health outcome and, and at the same time, reduce overall healthcare costs. The one thing that has been interesting, and obviously, as a country, we've been dealing with several crises over the last three months, and, you know, the COVID, 19 pandemic being, you know, front and center for many, and we have seen our strategy come to life in very meaningful ways, and, you know, across, you know, all three of those dimensions of community in the home and in the hand. And, you know, we've all heard about the need for testing and, and we have been able to bring testing into communities, you know, all across the country, we've now tested, as we sit here today, over 400,000 individuals and communities. And we have brought testing into the underserved communities where, you know, we've seen the population health that are where the, the COVID-19 virus is disproportionately affecting the minority populations. The second thing is, we've seen the pressure that the pandemic has put on hospitals, and we have worked with hospitals, we actually have a home infusion company to work collaboratively to discharge patients back into the home, you know, earlier than perhaps they would under normal circumstances. And we've now made 80,000 visits into individuals homes, providing infusion therapies, you know, in the comfort and convenience of their home that would have otherwise been delivered from within the hospital and we freed up important bed capacity as a result. And then we've seen a dramatic increase in the utilization of of telemedicine, where people are accessing information, they're accessing care off of their iPads, their iPhones or their desktops. So, those are three ways that we have seen our strategy being accelerated as a result of the pandemic crisis.

David Novak 28:57

Well, Larry, congratulations to you and your team for the great job you've done stepping up with COVID-19. It's, it's been amazing and certainly appreciated by so many, you know, and I thought that you as a leader did an absolutely terrific job working with President Trump to help form that private public partnership to get our country through the testing process. How did that how did that come about? And how did you see your role as a leader during that?

Larry Merlo 29:25

I'm glad you brought up, you know, public private partnership, because, you know, there's there's so much that gets discussed about should the government do this government do this and, and we talk a lot about, you know, the role of the private sector and, and, and I believe that your question is, is a perfect example of the importance of public private partnerships that the government can write the rules and establish the guardrails, if you will, but, you know, handing things off to the private sector. I think that's where competition innovation becomes. So important. And the one thing that I would, that I'm extremely proud of is we talked about the work of our CVs colleagues, and I could not be prouder of how they've stepped up to the challenges that, you know, that, you know, this, you know, has created as a business, but acknowledging that the same challenges that we've all dealt with as individuals in our personal lives, our colleagues have been dealing with the same challenges, but have stepped up and done phenomenal things in supporting their customers and, and the communities in which we live in serve. The second thing that I'll mention is, you know, within industry, sure, we're competitors, but I'm also very proud of what we have done as an industry. You know, we've been on the phone many times, sharing our experiences and, and learning from one another, and, you know, all for the betterment of, you know, the the individuals that we're serving. And, you know, I think it's something that, again, we can and should be proud of, and I think something that will carry us forward, even after we get this pandemic behind

David Novak 31:06

us. And speaking to that, Larry, how are you? Are you doing anything now from a proactive perspective in terms of planning for when we get the vaccine?

Larry Merlo 31:14

Well, David, another great question. And we're doing a tremendous amount of planning around that, as you think about, well, let's fast forward a bit. And think about the fall timeframe, because we will have the return of what I'll call the seasonal flu. That's something that we did not have to deal with back in the March timeframe, when when the pandemic was on us, if you if you think back to March, the seasonal flu was winding down and fast forward to the fall and early winter months that when the seasonal flu returns, think about all of us as individuals that, you know, we can probably recall a time where we had a mild case of the flu and the sniffles and head cold, and we probably, you know, powered through came to work. And that's going to be different this time. Yeah. And I think as individuals as human beings, the first thing we're going to want to check the box on is okay, I have symptoms, the symptoms are similar. Do I have the seasonal flu? Or do I have COVID-19? And we're going to want to get tested to bifurcate? Or to answer that important question. The second thing, David, that, you know, we all talk a lot about, you know, it's time to get your flu shot. And we know less than 40% of individuals get the seasonal flu vaccine. We went out and surveyed some individuals three, four weeks ago, and well over 60% of individuals said that I'm going to be getting a flu shot this year, it makes sense, acknowledging what everyone has been going through over the last few months. So, you know, we're planning for, you know, that fall timeframe, with a real focus on getting as many people vaccinated for the seasonal flu vaccine, again, continuing to ensure that, you know, our testing capabilities are, you know, are sufficient for, you know, satisfying the need that will be out there. And then, you know, to your point, I think that, you know, we all want to have some optimism that, you know, the our researchers will crack the code on a COVID vaccine, and, you know, and we'll be ready, again, working with the public sector to be able to be an access point, you know, for millions of Americans to be vaccinated in

David Novak 33:34

our country, we've been through so much this year 2020. We're on now in the midst of protests and riots due to the brutal death of George Floyd. How has this impacted CVS and and how have you, as a leader stepped up to make whatever statement needed to be made for your company?

Larry Merlo 33:56

It's a very important time in our company, and in society, in general, that and there there's something different this time, unfortunately, it's another example of, of an act of I'll describe it as, you know, inhumane treatment of an individual that we have seen play out multiple times over the last few years. And, and I know that we've held townhall meetings, we have, you know, colleague resource groups, and you know, and I've met with our black colleague resource group, and in Look, we've talked openly in terms of what we've seen. You know, I believe that there's a different level of transparency that, you know, that exists, you know, at least conversations that we're having and as the leader of CVS, you know, there's a new lens that we're approaching, you know, the diversity work that We do in and a heightened sense of urgency. And, and, and David I in in listening to colleagues in our organization, one of the things that we're we're embarking on look, we have a lot of programs that are focused on colleague engagement, colleague opportunities, things that we do in the communities to support our communities. And one of the things that we're undertaking is, we have an opportunity here to evaluate all the things we do and ask some very important questions. Maybe this goes back to where we started in terms of taking time to understand what's the issue that we're looking to solve? And what are the guiding principles that support those solutions? And we're evaluating all the things that we do what's working? And why is it working? And is there an opportunity to do more and accelerate the benefits that those various programs might be providing it the same time? What things aren't working? And why aren't they working? How do we fix what may be broken? And then, you know, are there things that are missing? Are there things that we're not doing that, that we need to? It's been very eye opening for me, David, I've gotten countless emails from colleagues of all ethnicity, males, females, and and I think that, like we've seen has, I've talked to a lot of our black employees in terms of what they're feeling. But I've also gotten many emails from individuals who are not black. And I say that because David, I read these emails, and they're self identifying themselves, I read an email that, you know, Larry, I am a white female. And here's where I work. And they talk about, you know, their experience in participating and listening in the town hall. And, and, and then they talk about things that they want to do to be part of the solution. It has energized me in terms of, you know, what I described as a new lens and a heightened sense of urgency to figure out what more we can do.

David Novak 37:05

Laura, you're tremendously visionary leader. I mean, you know, I don't know of too many people who could shape a company like you've shaped it and grow it like you've shaped it. And, you know, tell us about as you look forward, you know, how do you see your your you've got 10,000 pharmacies, what's your store the future look like? I've read about, like so many people, your health apps, talk a little bit about what you're trying to do there.

Larry Merlo 37:31

Thanks for asking that, because I love talking about this one. But yeah, but David, it really goes back to the strategy of making healthcare local, simple, and what we can do to help individuals, especially those with chronic disease, achieve a better health outcome. And, David, I remember wrestling with this discussion that I'm gonna go back 40 years, you know, those first stores that I worked in as a pharmacist, and then a manager of the store, I had a soda found in those stores. And I could remember getting, you know, getting to the store at 630 in the morning, because she had a fire up the grill, because it's 7am 715, you know, you had breakfast on the griddle. Okay, and the seats were filled. Okay. And, you know, in in, you've seen how the evolution of pharmacies has taken place. And for years, we wrestled with this question, are we a convenience store that happens to have a pharmacy in the back? Or are we a pharmacy that has a convenience offering? And I know that sounds like a very subtle difference, but the answer to those two questions is a mile wide. And as we decided that our future was as a healthcare a health services company, we answered that question that we're a pharmacy that is that will have a convenience offering. So we're repurposing we've begun the repurposing of our stores to bring that vision to life. And we think about the role of what we call the front of store in the app, you have all these health related items. But we also think about the role of personal care, whether it's dental care products or skincare products, and then beauty. And you know, those three categories health, beauty, personal care, they take up about two thirds of our front store, and there is an element to those categories that today we think about health care when you know something's wrong. And we and you know, in, we sit here a lot and we think about, well, how do you think about health as it relates to wellness, you know, so that we can get in front of why do we only think about health care when something's broke in our bodies, okay. And we think about those those products, those categories, and then we also think about what additional services can we bring to our stores, whether it's the role of our minute clinics and provide for more diagnostic services, so we'll have 1500 of these health pumps across the country by the end of 2021. And from the ones that we have up and running were wary and Sixers, seven markets at this point, the feedback from customers has been absolutely terrific. And I believe that we're we're definitely on the right track in terms of meeting an unmet need that exists in the eyes of many of our customers today.

David Novak 40:34

Yeah, I've always found that if it makes sense, from a customer perspective, the operators really jump on board and add, so add snap, what sounds like that's happening at CVS, which is great news for all. For me, as a consumer, I love it. You know, you know, Larry, speaking of consumer, you and CVS, you know, the experts say that you're really at the heart of consumerism, and in health care, which is a major, major new happening, you know, how do you go about, you know, really identifying consumer needs and gaps and innovating, because you're doing a heck of a lot of it?

Larry Merlo 41:10

Well, David, a lot of that is we spend a lot of time listening to our customers. And look, I've learned through success and failure, that, you know, you've really got to be a good listener, because our customers, they won't tell us what to do. But if you listen and ask the questions the right way, they'll sure give you an awful lot of insights about what they don't like and what they're frustrated with. And, and it becomes our job to take those listening skills, to learnings and the learnings to solutions. And that's what we've tried to do what we're working to do in terms of understanding what those unmet needs are, and then bringing solutions. Now, the other thing that is part of that that I get pretty excited about is, I think the role of data, analytics and technology. I describe it as there's this new intersection that's forming, and the opportunity to as you look at all of that information, and how you can be predictive of well wait a minute, something as simple as wearing a sauna on a statin for high cholesterol, and he should have had his prescription refilled five days ago. And he has, we need to find out why. It's amazing what you learn high cholesterol is largely asymptomatic. You know, so you hear comments, like, I didn't feel any different after than I did before. So I didn't think it was working. So why do I want to spend the money for a prescription that's not making a difference? Or you hear about Well, I started getting cramps in my legs, and I didn't like those side effects. So I stopped taking, it's an opportunity to proactively engage and learn all those different things and separate fact from fiction all with the goal of again, helping people stay healthy. So David, I would say that we're that we're in the early innings of triangulating data analytics and technology. And that was really the beauty of what made CVS and Aetna coming together as one so powerful that Aetna has a lot of that information resident, about the members that they serve. And when you think about the assets that are resident within CVS that we have an opportunity to face off with those customers, because we see them on a regular basis.

David Novak 43:35

And that gives you a big advantage, big advantage over the long term. You know, everybody talks about Amazon, which is obviously an incredible company and major, it's disrupted almost every category, you know, how do you see countering them? You've obviously got the bricks and mortar.

Larry Merlo 43:51

Okay, but we talked about how do you make sure that you don't leave any white space for disruption. And some of this goes back to listening to customers and, and like you. And you're absolutely right, Amazon has has changed the landscape, you know, for many consumers, and, you know, and we talk about so let's use home delivery today. And, you know, we think that we've made it pretty convenient for customers today. Today, you got more than 70% of the US population that lives within, you know, three miles of a CVS and, you know, a vast majority of our stores have drive throughs so you can, you know, get a prescription without ever getting out of your car, if that's your priority. We have mail order services, we now have home delivery. So, you know, they've been a lot of people have talked about omni channel and we're sitting here today saying, well, we offer that on the experience that you can be whoever you want to be based on the priority at that point in time. And look we're thinking about The journey that we're on, we're defining what omni channel means for health, if you think about it that way as well. Yeah, I love the

David Novak 45:07

consumer focus. Fantastic. You know, Larry, this has been so much fun. And I want to have a little bit more before I let you go hear it. I want to do a little lightning round here with you. Okay, so what three words would best describe you?

Larry Merlo 45:21

That's passionate. Sometimes, well, that'd be four words of say passionate, passionate, impatient and humble.

David Novak 45:30

Alright, if you could take the place of one person for a day, who would it be?

Larry Merlo 45:37

David, I grew up in western Pennsylvania. And I had such admiration for Arnold Palmer. And I say that because I, I'm not a good golfer. I like golf. But I see Mr. Palmer as someone who excelled as a professional athlete. But someone who also excelled as a business person and an entrepreneur. And someone who never forgot his roots, never forgot where he came from, and had expressed an element of humility that I actually got to meet him once. And I got to speak to him for about 10 minutes. And at the end of 10 minutes, I felt like I knew him for 20 years, he made sure that comfortable,

David Novak 46:26

you know, and what would be something that, you know, few people would know about you, Larry?

Larry Merlo 46:34

Well, David, um, I actually was a musician. I thought I actually thought about majoring in music. And I, as I was going through grade school, junior, and senior high school, I played the piano, the flute, the saxophone and thoroughly enjoyed it, it it helped. It helped pay for part of my college expenses, and I still play the piano. But you know, I think back to those days fondly, you know, it's interesting, because I do believe that your music taught me discipline. And I think a lot about that.

David Novak 47:20

Did I remember playing the saxophone for about six months? Do you have a hidden talent?

Larry Merlo 47:29

I, you know what, I'm not a very good athlete. Okay, I'm a want to be athlete. You know, probably the music is what I would describe that as my is my hidden talent.

David Novak 47:40

Larry, you've had so much success. But you know, a lot of leaders have what they would call their epic fail, or certainly a failure, what would be your biggest failure that you've had and what you learn from it?

Larry Merlo 47:51

You know, what, David, there's two things that that come to mind. And we talked a lot about listening to our customers. And, you know, and I can remember, God, that was probably maybe 20 years ago, maybe even a little further and that, you know, that we saw one of our competitors, opening up drive thru windows for the pharmacy. And, and, and I can remember saying, well, we can't do that. What do you mean, we can't do it? Well, if if they go through the drive thru, you know, they won't come inside the store, okay. And, in the learning from that was, well, look, if they want to use the drive thru and you don't have it, then they're not going to come to the store anyway, because they're going to go to somebody who does and, and, and that was an important learning that, you know, if you've got to meet the needs of the consumer, you know, or they'll find someone who does. And the second thing that comes to mind in that is, we talk a lot about, you know, about innovation. And, and I think that this is probably a bigger issue than an individual failure as, as an organization, you know, we would sit here and talk, we have a wonderful culture, and, but, you know, why are we so slow at innovating, and in what we realized was, well, there's fear of failure, because of, you know, our culture gets in the way of, you know, our culture supports that kind of success, and people want to do the right things, and, but we haven't made it easy for people to fail. And years ago, David, we, you know, we talked a lot about that as an organization. And, you know, in and I still remember at a town hall meeting where we gave an award to someone, you know, who failed on a project, okay. And you could have heard a pin drop in the room, okay. And it was symbolic of what I was just describing. And we talked about the learnings from that failure in how that failure was really a success. And that was really where we started talking about it. If we're not failing on some things, we're not pushing the envelope enough. And we'll celebrate failure as long as we meet three criteria, fail fast, fail cheaply and fail on something new. And, and I'm happy to say that we've gotten better. Although, David I, we talked about the pandemic a minute ago. And one of the things that we just did this as a leadership team about about a week ago, and I said earlier, I couldn't have been prouder of, you know, our organization in terms of how folks stepped up. But one of the things that I know, several of our senior leaders spoke up and said, Ma'am, we were quick in terms of making decisions and moving and someone made the comment that you know, what, we, we rolled out things that, you know, we didn't, they weren't fully baked, you know, and we had a 75% 80% solution, and we knew it, but we went with it anyway. And we iterated the balance along the way. And there was a really good wording that came from that, that if we had waited to get it to 90 or 95%, then we we perhaps would have missed, you know, meeting the need of consumers.

David Novak 51:17

Another big issue in our country today is opioids. And you've taken the lead on this front as well.

Larry Merlo 51:24

Yeah. David, it's, we've all seen the pain and frustration around that, that, you know, it's a situation that, that doesn't discriminate. It's in the cities, it's in the suburbs, it's in rural America. And this a good example of, I remember, one of the first things that we did was empty out your medicine cabinet. And we didn't know what to expect, when we did that we were doing these drug take back programs. And all of a sudden, the quantities that were coming back, it was like, well, by the time we empty Every medicine cabinet in America, it'll be time to start over again, because we haven't solved for you, it kind of gets back to what's the problem that we're solving for. And at the time, we didn't have a solution for why is this product getting in the medicine cabinet to begin with. And when we realized that we went back and, and one of the things that we found, and probably everybody has an example of that, that, you know, whether it's going to the dentist or somebody has an acute injury, and they walk away with a with a prescription for, you know, 30 or 60 pain pills. And the reality is, you know, they might need, you know, six or eight, because it's it's acute short term pain. And those unused quantities, is what was ending up in the medicine cabinet. And unfortunately, those were becoming a source for how people were entering the opioid world to begin with. So one of the actions that we took is, you know, if, if someone was new to therapy, we were not going to dispense any more than a seven day supply. And, and look, we over the last few last several years, we've seen a dramatic decrease in both the number as well as the quantity of opioid prescriptions that we have dispense them. Look, we think that that's made a meaningful improvement. But look, we still have a lot of work to do there. Our pharmacists have gone into communities, we've, we've gone in and done our pharmacist have gone into schools and have now touched more than a half a million students in terms of talking about the dangers of prescription drug abuse.

David Novak 53:52

That's great. Well, Larry, one thing for sure, you have a tremendous talent of building a tremendous business. And, you know, I don't know of anybody who has grown their business $150 million in revenue in nine years. That's, that's really, really something. And so hats off. Just one last question here. You know, what would you say about your upbringing and just your personal family situation that that that is really driving who you are today?

Larry Merlo 54:24

Dave? Yeah, I think about my my upbringing and what I was fortunate to be the first member of my family to go to college and my parents, they taught me the value of a strong work ethic and the value associated with being a good human being. I've always worked hard to do that. And I think embedded in there is it was something that struck me back to speaking about Arnold Palmer and one of those things I believe in is don't forget where you came from, and in thinking about it individuals that had an impact on on your life, whether it's in your business life or your personal life, and the responsibility that we have as adults and as business leaders to pay that forward, and my wife and I have one child, and we're proud of her as well. And I see those those values in her as well. So that's something that, that I take a lot of pride in.

David Novak 55:24

Oh, fantastic, Larry, you know, this has just been amazing. And thank you for sharing your insights with with other leaders, there's so much we can all learn. So thank you very much,

Larry Merlo 55:35

David enjoyed doing it enjoyed the discussion.

David Novak 55:46

You know, I can't think of a better example of how a simple and compelling purpose transformed a company. But it just didn't happen. Larry first had to throw out the convoluted missions and visions of the past, he had to dial into something simple and compelling, something people could really get on board with, and something that people could relate to and make tough decisions, and actually bring that purpose statement to life. This week, as part of your weekly personal development plan, I want you to do something a little scary. I want you to just stop casually in the hall, or ping some of your people on Slack. And just ask them, hey, without looking it up, what's our organization's purpose? Or ask them? What's the purpose of our team? Ask a few more people, listen to their responses, and then see for yourself how well or maybe how not so well. Your vision is coming through to your team in your organization, you might find there's an opportunity to simplify your organization's vision and purpose to and hey, like CVS Health, there may be a whole new level of success waiting for you out there when you do. So do you want to know how leaders lead? What we learned today is the great leaders craft a simple and compelling purpose that their people can actually act upon? Thanks again for tuning in to another episode of how leaders lead where every Thursday you get to listen in while I interview some of the very best leaders in the world. I make it a point to give you something simple on each episode that you can apply to your business so that you will become the best leader you can be

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