Pharmaceutical Executive Europe - January 2008 - (Page 31) Pharmaceutical Executive Europe January 2008 The Mix 31 The Mix Strategies, tactics, insights and opportunities New Models of Excellence Stephan Danner, Aleksandar Ruzicic and Martin Oelschlegel discuss the results of a recent study surveying attitudes to ‘commercial excellence’ in the pharma industry. he commercial operating model traditionally used by the pharmaceutical industry is under growing strain. Financial pressure, regulatory changes and an increasing number of decision-makers in the healthcare sector are among the factors calling into question the industry’s current approach. Companies must now look towards ‘commercial excellence’ if they want to succeed in these turbulent times. Commercial excellence was the subject of an interactive study (conducted by Roland Berger Strategy Consultants at the 6th Annual Eyeforpharma Sales Force Effectiveness Conference [2007]), which surveyed over 250 participants and interviewed executives from more than 40 companies. This article presents the study’s key results and examines new emerging business models. T therefore reach far beyond the activities of the sales force to embrace all commercial interactions with customers. Ultimately, it aims to optimize impact by maximizing profit contributions at all levels. Since the end of 2005, ten leading pharmaceutical companies have announced cost-cutting programmes that have dispensed with 50000 jobs. The three dimensions of commercial excellence Commercial excellence as we understand it has three dimensions: sales excellence, customer excellence and new business models. As outlined below, these can be distinguished based on their requirements for change and business impact. Sales excellence. In recent years, sales excellence has become something of a standard in the pharmaceutical industry. Still, more can be done to increase sales effectiveness and efficiency. In fact, 85% of those surveyed believe that efforts to improve sales excellence could boost profits by 5% or more. According to the interactive survey participants, in the coming two years, the industry will focus on the traditional levers targeting call quality as well as performance and people. Since further improvements will continue to deliver A radical rethink Since the end of 2005, ten leading pharmaceutical companies have announced cost-cutting programmes that have dispensed with 50000 jobs. Many companies have downsized their sales forces by more than a third, while others are planning major cuts. Nearly 40% of respondents to the commercial excellence survey expected their firm to reduce the pharmaceutical sales representative headcount between 5% and 40% over the next two years. But cutting back the sales force is no longer a sufficient response to major market changes. Customer focus is also a decisive factor. Indeed, customers must become the central focus of operations. Commercial excellence must benefits, it is not surprising that the vast majority of companies are still investing heavily in sales excellence. These investments are very unlikely to decline in the future, as changes in the healthcare environment and competitive dynamics continuously alter the objectives of sales excellence. Customer excellence. Customer excellence aims to maximise the impact of interactions with an ever-larger group of customers, including governments and other payers, providers and patients. The study revealed that the relative importance of individual and organizational stakeholders in the healthcare sector is shifting across Europe. While specialist doctors, opinion leaders, health authorities, payers and health insurers now exert greater influence, the power of general practitioners (GPs) is waning, and the majority of drug companies have taken these aspects into account. However, the potential of customer excellence lies in an integrated approach that should focus on the most promising areas. The commercial excellence survey and interviews showed that in light of new regulations and guidelines, customer strategy/customer relationship management (CRM) has great potential to increase profits. Other areas with strong potential include an aligned organisation; new functions such as key account management and market access; and optimization of the promotional mix. As a result, the majority of pharmaceutical firms have been reviewing their customer strategies. More than 50% of the managers interviewed said that this shake-up would be critical to future
Table of Contents Feed for the Digital Edition of Pharmaceutical Executive Europe - January 2008 Pharmaceutical Executive Europe - January 2008 Contents From the Editor News and Analysis Calendar Corporate Strategy: Walking the Line Executive Profile: The Pharmacist’s Friend Q&A: An End to Drug Counterfeiting Healthcare Cost Assessment: Ready to Make NICE? Pricing and Reimbursement: Through the Reimbursement Barriers Generics: India Inc. The Mix: New Models of Excellence Last Word: Mid-size Matters Pharmaceutical Executive Europe - January 2008 Pharmaceutical Executive Europe - January 2008 - Pharmaceutical Executive Europe - January 2008 (Page 1) Pharmaceutical Executive Europe - January 2008 - Pharmaceutical Executive Europe - January 2008 (Page 2) Pharmaceutical Executive Europe - January 2008 - Contents (Page 3) Pharmaceutical Executive Europe - January 2008 - From the Editor (Page 4) Pharmaceutical Executive Europe - January 2008 - From the Editor (Page 5) Pharmaceutical Executive Europe - January 2008 - News and Analysis (Page 6) Pharmaceutical Executive Europe - January 2008 - News and Analysis (Page 7) Pharmaceutical Executive Europe - January 2008 - News and Analysis (Page 8) Pharmaceutical Executive Europe - January 2008 - News and Analysis (Page 9) Pharmaceutical Executive Europe - January 2008 - News and Analysis (Page 10) Pharmaceutical Executive Europe - January 2008 - News and Analysis (Page 11) Pharmaceutical Executive Europe - January 2008 - Calendar (Page 12) Pharmaceutical Executive Europe - January 2008 - Calendar (Page 13) Pharmaceutical Executive Europe - January 2008 - Corporate Strategy: Walking the Line (Page 14) Pharmaceutical Executive Europe - January 2008 - Corporate Strategy: Walking the Line (Page 15) Pharmaceutical Executive Europe - January 2008 - Corporate Strategy: Walking the Line (Page 16) Pharmaceutical Executive Europe - January 2008 - Corporate Strategy: Walking the Line (Page 17) Pharmaceutical Executive Europe - January 2008 - Executive Profile: The Pharmacist’s Friend (Page 18) Pharmaceutical Executive Europe - January 2008 - Executive Profile: The Pharmacist’s Friend (Page 19) Pharmaceutical Executive Europe - January 2008 - Q&A: An End to Drug Counterfeiting (Page 20) Pharmaceutical Executive Europe - January 2008 - Q&A: An End to Drug Counterfeiting (Page 21) Pharmaceutical Executive Europe - January 2008 - Healthcare Cost Assessment: Ready to Make NICE? (Page 22) Pharmaceutical Executive Europe - January 2008 - Healthcare Cost Assessment: Ready to Make NICE? (Page 23) Pharmaceutical Executive Europe - January 2008 - Healthcare Cost Assessment: Ready to Make NICE? (Page 24) Pharmaceutical Executive Europe - January 2008 - Pricing and Reimbursement: Through the Reimbursement Barriers (Page 25) Pharmaceutical Executive Europe - January 2008 - Pricing and Reimbursement: Through the Reimbursement Barriers (Page 26) Pharmaceutical Executive Europe - January 2008 - Pricing and Reimbursement: Through the Reimbursement Barriers (Page 27) Pharmaceutical Executive Europe - January 2008 - Generics: India Inc. (Page 28) Pharmaceutical Executive Europe - January 2008 - Generics: India Inc. (Page 29) Pharmaceutical Executive Europe - January 2008 - Generics: India Inc. (Page 30) Pharmaceutical Executive Europe - January 2008 - The Mix: New Models of Excellence (Page 31) Pharmaceutical Executive Europe - January 2008 - The Mix: New Models of Excellence (Page 32) Pharmaceutical Executive Europe - January 2008 - The Mix: New Models of Excellence (Page 33) Pharmaceutical Executive Europe - January 2008 - The Mix: New Models of Excellence (Page 34) Pharmaceutical Executive Europe - January 2008 - Last Word: Mid-size Matters (Page 35)
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