Company Leadership

Biographical Background Information on the CEO

President and CEO of CVS Caremark (CVS) is Larry J. Merlo, age 57. Larry Merlo is a professional pharmacist with 30 years experience. He has gotten initial pharmacy health care education in the University Of Pittsburgh School Of Pharmacy (“Larry J. Merlo,”n.d.). Merlo’s career started at People’s Drug, which was acquired by CVS in 1990 (“Larry J. Merlo,”n.d.).

In the CVS Corporation, his skills and knowledge have developed to the extent that allowed him holding positions of increasing responsibility. In 1998, Larry Merlo was assigned Executive Vice President—Stores of CVS Pharmacy. Two years later, he advanced to the position of Executive Vice President—Stores of CVS Corporation. In 2007, Merlo got new higher positions – Executive Vice President of CVS Caremark Corporation and President of CVS/pharmacy. In 2010, Merlo became President and Chief Operating Officer of CVS. Ultimately, in March 2011, he assumed charge of President and CEO of the largest pharmacy health care provider in the United States (Form 10-K, 2012, p. 32).

Under his leadership built on the legacy of his predecessor Tom Ryan, the company was ranked 18th on the 2012 FORTUNE 500 list by Fortune magazine that annually ranks the U.S. companies by revenue. At present, Merlo keeps leading the company in a way of developing its competitive advantages and moving forward market leadership. As President and CEO of CVS, he intends to expand and empower the role of the pharmacist in “helping people on their path to better health” through improving health outcomes and lowering overall healthcare costs (Merlo, n.d.).

The corporate Strategies

To accomplish their strategic intents – to lower costs and improve health care, the company has utilized the corporate strategy defined by Merlo as reinventing pharmacy with a focus on innovations (Merlo, n.d.). Based on the integrated pharmacy services model, reinventing pharmacy implies implementing innovative pharmaceutical solutions, exceptional client service, responsiveness to customers, product diversification and price cutting (CVS Caremark, 2011).

Obstacles

According to Merlo, the health care system faces the three major problems: worsening demographic situation that causes the long-term increase of demand for services; the transformation of the health care system that increases the level of confusion and complexity; and “the projected shortage of primary care physicians” that affects the cost and quality of services (2012).

Leader Special Skills and Personality Traits

The most important trait of Larry Merlo as a leader is his visionary leadership that refers tocomplete understanding the big clearly communicable picture of what he wants his organization to be in the future (Richter, n.d., p. 342). Merlo’s vision that manifests in setting clear goals and defining challenges is accompanied by his ethical quality, trustworthiness, and excellent communication skill observed in his speeches (“Concept of leadership”, 2006; Merlo, 2012). These skills are in the center of his influence on followers.

CEO’s Management and Leadership Techniques

These techniques focus on designing and implementing intrinsically motivating environments that involve engaging the team, establishing ways for skill enhancement through regular training programs, and evaluating through recognition and compensation programs (CVS Caremark, 2011, p. 27, 73, 73; Richter, n.d., p. 350). Moreover, it is supported by fostering the company’s culture of skill development and lifelong learning and sustaining trustworthiness (CVS Caremark, 2011, p. 28, 64).