Change is frightening

The phone wasn’t just a better telegraph—it was a new paradigm. Likewise, digital technology isn’t just a new channel; it’s a new way of doing business.

The story of Alexander Graham Bell and the initial rejection of the telephone is a classic case of disruptive innovation being misunderstood—a pattern that repeats across industries, including pharma. The big boy of that era, Western Union Telegraph Company – then into telegraphs, now into financial services - dismissed the telephone as a "toy" because it didn't fit their existing mental model or business model, which was built on telegraphy. They couldn’t see its transformative potential beyond the lens of their current success.

This lesson was repeated by Thomas J Watson, the co-founder of IBM when he said “I think there is a world market for maybe five computers.” Fun fact: Watson was the first person to receive a telephone call. He was assisting Graham Bell in its invention. The same man made the same mistake when it came to computers. Personal computers didn’t fit the mental model of IBM.

This wasn’t the end of it: Kodak did it, Nokia did it, Microsoft did it, and most recently Intel did it. Nobody, it seems, learns from history.

So, why are transformative technologies ignored?

Could be cognitive biases, where people and companies tend to evaluate new innovations using old frameworks. Intel concentrated on traditionally developing chips for PC and server applications, neglecting the potential of AI.

Another reason is the fear of cannibalization. Established companies often fear that new technology will eat into their existing business. Kodak felt that embracing digital photography meant undermining printed photographs into which they had invested billions.

Or is it just a lack of imagination? The full use-case and business potential of transformative technology often isn’t obvious early on. The idea of a smart phones and their full potential, didn’t exist yet.

Another reason could be the underestimation of user adoption. People overestimate how hard it will be for users to adapt. Nokia thought that tough, hard, difficult to break dumb phones at <Rs 10,000 price points were good. Delicate smartphones at >Rs.50,000 prices wouldn’t work. To be fair, even Steve Jobs didn’t think that the iPhone was for everyone.

The pharma industry is now in a similar position with digital technology—AI, digital therapeutics, precision marketing, remote detailing, and omnichannel engagement.

We use old metrics for new mediums. Like Western Union using telegraphy metrics to judge the phone, pharma often judges digital marketing by outdated rep-centric KPIs. “How many Rx did you get from that email campaign?”

We make regulatory inertia our pet excuse. Many pharma firms hide behind regulations to avoid innovation, much like legacy players said phones weren’t secure or reliable. Like I tell anyone who cares to listen, “Don’t become a law firm that also sells medicines!”

And our favourite, cultural resistance. Pharma’s conservative culture breeds suspicion toward change—especially if it comes from outside (e.g., startups, tech firms).

So is there something we can do to avoid a similar fate? To be sure, an industry isn’t being compared to single companies here. But if industries change, they don’t do so because they have a choice. They only do it when they don’t. And when industries change, they sacrifice a few companies to that change. The larger ones may survive if they pivot fast enough, but those that can’t, disappear.

To be fair, we are of course, doing some things right. A few companies are experimenting early and often. They are testing AI, digital reps, personalised content, and telemedicine integrations. But, the scale is tiny. It needs to grow now—before competitors (like digital health companies and other digital first players) define the space.

But, there are things we need to get right

1. We should migrate tech adoption from upstream ops (drug discovery, clinical trials, manufacturing, finance, inventory and supply chain) to downstream ops (customer and partner/stakeholder engagement).

2. We must reframe success metrics to move from reach and frequency to engagement, outcomes, and experience. Treat HCPs, pharmacists, patients and caregivers as users, not just targets.

3. Building a digital-first culture is paramount. This includes upskilling teams (half-day workshops do not count), recruit digital natives (and learn how to engage them), and reward risk-taking (“I didn’t wait for approvals, I just got it done” is not risk)

4. We must invest (as opposed to paying third parties for shared services agreements) in scalable infrastructure such as data lakes, cloud platforms, content factories—these are the rails of modern pharma marketing. We must OWN them.

5. Most importantly, learn from health techs, consumer brands, and SaaS companies. Don’t let legacy blind spots become liabilities.

Alexander Graham Bell’s phone wasn’t just a better telegraph—it was a new paradigm. Likewise, digital technology isn’t just a new channel; it’s a new way of doing business. Pharma companies that ignore it risk becoming the next Western Union—powerful once, but paralysed by their own success. Those that adapt will shape the future of healthcare.