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Get out of the 'arms race'

Published on 16/12/03 at 10:06am

As healthcare consumers take more responsibility for their health, analysts predict the dynamic between the traditional pharma sales force, healthcare professionals and consumers is set to undergo considerable change.

As this change takes place, pressure on sales managers will mount. Within this context, a useful starting point is to examine what is meant by an effective sales force? The short answer is 'one that sells a lot', but there is research, most recently by the Gallup Organisation, that a large proportion of the sales force doesn't get around to doing a lot of selling.

According to a Gallup survey even in the top companies, 35% of the sales force did not have the talents necessary to achieve acceptable results predictably.

Making the most of your sales force, including reaching the 35% level, boils down to two things: do you have the right resources - people, messages and technologies - and are these resources being deployed effectively? There is also a need to distinguish between macro-level solutions, which affect the sales force as a whole, and those at the micro-level where they affect individual rep performance. Finally, there is a need to distinguish between cultural issues, in particular motivation, compensation and psychology, and technical solutions which can all add value to the equation.

The recipe for creating a superior sales force seems to be one part technological to four or five parts cultural. Nigel Huxtable of solutions provider StayInFront says that one of the technological aspects is the change from push to pull messaging. Under the push model, a rep sees a prescriber four or five times a year, changing prescribing behaviour in some manageable way with an  impact on what the prescriber offers to the patient.

An effective sales force now, says Mr Huxtable, is one that has the right message at the right time. Some of this message can now be delivered through technology, but the trick is to push a meaningful message to the prescriber to enable that change to occur.

What makes a good sales force?

There are three elements to this: the macro and sales force level, and the micro or rep level. At a macro level, companies with data-driven services can help you achieve a number of things.

They can conduct competitive before and after launch analyses to gauge and spur sales effectiveness. Prescribing patterns can be correlated with sales call frequency and a decison can be made on when to use internal or external sales resources for a particular territory. Market share can be monitored over time and the prescribers driving brand performance identified. Another key issue to address is sales force structure and deployment, and there are a number of key sales objectives to consider:

  • Maximize call planning within budget.
  • Identify a promotional mix to maintain 'top-of-mind' awareness among prescribers.
  • Pinpoint sales territory size and structure for optimal deployment.
  • Increase product market share by minimizing sales call time to impact.

At the micro level, you need to assess several performance management fundamentals. Building a positive workplace, promoting loyalty and encouraging talented reps to reach high targets are important. Setting the right business expectations and performance goals for each rep is another step to take.

Motivate outstanding performances by giving appropriate pay and recognition and study top sales performers and sales managers to benchmark best practices. Invest in the best by developing the talents and strengths of top salespeople and hire reps who will sell more, develop engaged customers, and stay longer. Develop sales managers who attract, develop, and retain high sales performers.

Those are the issues, but what drives success in the first place? The answer is hitting targets. But when those targets come from the salesmen themselves perhaps you begin to see the problem!

What salesperson would keep his job if he or she predicted that they were not going to meet the quarterly quota? None. The pressure that reps feel to make optimistic predictions and please their managers creates stress throughout the company. The sales person predicts closing dates he has no control over, the sales manager takes the heat from top management, and the rest of the company has to clean up.

One way of solving this problem would be to take forecasting away from reps and give it to their managers. This would motivate sales managers to get more involved in assessing leads, rating their quality, and working to set mutually agreed objectives. No amount of training or money will make an unqualified salesperson successful. Sales managers must know what attributes, skills and motivations mark out top performers and how to interview to hire more of them.

Used properly, technology can help less capable salespeople to achieve stretch targets, by selling smarter. Unlike other industries where the manufacturers have a direct channel to the consumer, for pharma the prescriber steps in between them, something that is unlikely to change.

Demand is changing from push to pull, with the watchword being to deliver the right message at the right time. That extends to the face-to-face meeting with the prescriber. If the prescriber wants a drug other than the one being detailed, you will need to focus on what he is interested in, and that means having facts at your fingertips about other drugs.

"The rep spends five times as much time waiting for a prescriber as he does in seeing him. This downtime can be put to more productive use studying up on the key messages, and the details of what prescribers have been pulling from other channels," adds Mr Huxtable.

At the heart of this is effective selection. Successful players will develop an ideal candidate profile by studying your top performers. What makes them excel? Turn those qualities into an ideal candidate profile that your sales managers can use in the hiring process.

Big may not be better

The top 40 pharma companies have doubled the size of their sales forces in the last five years but prescribing has only increased by 15%. More than 175 NHS supplier companies are chasing falling face time with field forces from over 1,200 at Pfizer to sometimes less than six.

Total sales headcount fluctuates and is hard to get a fix on, but estimates say there are 14,000 to 20,000 reps employed in the UK. Typically, this growth has taken the form of an 'arms race'.Just as the USA and Soviet Union increased their nuclear capability in response to escalation by their opponents during the cold war, so pharma companies scale-up the size of their sales forces in response to competitor increases.

In addition, prescribers have less time to spend with reps. In the US, prescribers have already reached what Cap Gemini Ernst & Young call 'time saturation', with UK and European prescribers having only so many hours in the day and only so many reps that prescribers can see and still get their work done.

Gareth Thomas of Cegedim adds: "It's a big decision for the first company to cut back rep numbers in a major way, to really be able to prove whether that's effective or not.

"The more reps there are, and given that there not an equivalent growth in prescriber numbers, the harder it becomes to get appointments, which tend to be shorter. There's a lot of time spent in the waiting room and it's quite difficult to get quality time.

Training for effectiveness

Training is also likely to change. In the traditional classroom model the company brings reps together, providing them with information, gives them any new collateral and sends them back on the road.

This is expensive both in direct costs - accommodation, travel - but also in opportunity costs, because reps are pulled out of the field for one or two potential selling days. In a pull solution model, the rep receives electronic updates, which supplement the classroom sessions by providing reminders about the key messages, telling them about new benefits. The rep can catch up on this during downtime outside the surgery door.

Two new cultural developments are becoming available, in the HR field, which are increasingly becoming mainstream. These involve matching sales training to the individual needs of your sales force. Sales training needs a prior assessment of each participant's strengths and weaknesses.

The other development involves offering listening skills' programmes in self-management, assertiveness, technical training, sales coaching, presentation skills, and approaches to prospecting. This must be presented to sales managers with a quantifiable ROI. Managers don't want people distracted from the field unless you can show them a profitable benefit.

The role of technology

Vendors freely admit that sales force automation and CRM was too complex in the early days. The tools now available from vendors can have software deployed on PDAs for data capture, backed up by fully synched remote laptops. The PC is the main link back to the database with the PDA carried by a rep for record keeping and updating, containing the key messages.

"Technology only plays a small part in making a sales force effective. Clearly it revolves around things like the quality of the individual, management, and the structure and culture of the organisation, which have a huge impact on whether a particular company is going to be successful or not," concludes Cegedim's Gareth Thomas.

Motivating, and retaining top performers is also an important factor. Industry pundits casually talk of an average turnover rate of 19% and sometimes technology can help improve this.

Reps will often be sitting waiting with other reps, casting surreptitious glances at each other's working styles. If one notices the other has better technology, and finds out that it also allows them to make a quick and effective capture of information before they go home, and that KPIs and information are recoded more efficiently,  they are more likely to use them.

At a cultural level, money talks. Performance assessment and compensation is a key issue for pharma companies, who invest heavily in training and motivating their sales teams. Given limited face-time with the prescriber, the trick is in putting specific plans in place to retain the best sales reps and ensure they fully optimise their physician contact.

The market model has changed to a pull system and the Internet is playing a key part. The patient has access to websites, he learns about drugs and then he asks the prescriber about them. The prescriber can pull information through the channel of his choice and the web is the ultimate pull medium. Websites are always accessible which means some big changes to CRM, and Pharmafocus will be looking in detail at those in a future issue!

For now, the key point, says Nigel Huxtable, is that CRM needs to show how the prescriber has researched the product. That involves a move from an electronic territory management tool, which lists the physical or phone contacts with the prescriber, to an enterprise-wide solution for sales and marketing.

The trick here is to open up all the main contact points with the prescriber. A good sales force is delivering the right message at the right time. It needs to be coordinated, so that a drug launch reaches the widest number of prescribers simultaneously.

Motivating a sales force

It also needs to be responsive, accepting that a prescriber is not just a passive recipient of information, but also an active participant in dialogue. If they query something, the rep needs to answer them quickly and competently. The rep must also anticipate likely questions and he can predict them from the prescriber's online dialogues.

This can be managed through a judicious use of technology, for example to encourage prescribers to engage through a company portal. Using technology and providing it to the field force is only half the battle. Persuading people to use it effectively is the really clever trick. Studies by AMR Research show that hard-sell techniques  like cutting commissions are not the way to get sales staff to accept CRM. Show them it can help do their job better and adoption will soar.

Employee buy-in of a CRM application usually tends to be the forgotten piece of a successful CRM implementation. This is never truer than with the sales staff. However, it is not an insurmountable problem.

Consider the thought process of a sales rep: according to Deloitte Consulting's report How To Eat the CRM Elephant they may think the new sales force automation system means less time to sell; spelling out exactly what the new system can do for employees is essential. Deloitte calls it "minding your gives and gets."

"Making CRM work is a matter of effectively managing political capital," the report says. "To get your stakeholders to play the game, you need a lot of 'gives' from them. So, in return, you should be prepared to offer them 'gets' - something of value you can deliver."

"Technology is an enabler not a solution. Improving sales force effectiveness is about using and changing information: improving communications to the right business users will lead to informed decisions," says Mr Thomas.

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