Strengthening Sales Success

John Moran looks at how value delivered to offices can be used as a key metric of sales force performance.

What's the current state of the physician-sales rep relationship?

John Moran. Physicians continue to cut back on time spent with pharmaceutical sales representatives in the office during practice hours. This is in response to increasing patient loads, escalating administrative requirements, and tighter formulary restrictions. IMS Health physician research conducted in the first half of 2009 indicates that physicians are giving office access to fewer, select reps on the basis of who delivers more value to the physician and staff. Physicians define value in very specific ways, and these vary according to the physician's specialty, size of practice, geography, characteristics of patients under care and certain personal preferences.

A three-year longitudinal analysis of IMS value metrics shows that value received correlates more strongly with prescribing preference and market share than traditional sales force effectiveness (SFE) metrics, which overemphasize the mechanics of the rep-physician interaction. By identifying the primary drivers of value for distinct segments of physicians, and adding these to activity metrics, US sales forces can reverse the gradual decline in strength of relationship with physicians and achieve greater field productivity.

Why haven't traditional SFE initiatives improved these relationships?

JM. Since the early 2000s, when more systematic evaluation of sales forces using physician research was coined, companies have invested millions in understanding the quality of their selling effort. Today, just about every major US pharma or biotech company evaluates SFE by gathering physician feedback about rep interactions. Typically, a company will spend $3 million to $5 million per year to capture and analyze these data. This does not include the cost of internal resources to manage, interpret and communicate results, and it also excludes the opportunity cost of focusing the field on things that do not drive market share.

According to commercial executives interviewed about SFE initiatives, few have been able to point to significant ROI on these initiatives. Executives identify two primary reasons for this: research findings are not specific enough or geographically focused to be actionable; and these findings do not inspire the confidence and trust of the sales force. Given this disappointing track record, managers have lowered their expectations of SFE. What was originally implemented as a tool to drive rep productivity and measurable share gain has become comparative research that provides general 'strategic' insights about physician interactions. Worse, there is a proliferation of published industry rankings of sales forces, which is usually broken out by primary care and specialists that leave managers with contradictory insights about who really is performing well and why. Commercial organizations clearly need better metrics and analytics to explain and predict market share, which generate specific guidance for improving performance.

Focusing on the things that your customers value most and implementing actions to improve your delivery is an exciting way to re-energize SFE and deliver stronger, more improved ROI.  Companies focused on transforming SFE into value for the customer are surpassing their competitors.

What questions should be considered for tracking SFE?

JM. SFE, or customer effectiveness, metrics were largely developed when companies deployed selling models heavily weighted to reach-and-frequency. With few exceptions, metrics have not kept up with the sweeping change in how prescribing decisions are made or forced upon prescribers. Companies that rely solely on traditional SFE metrics are not leveraging all the information that exists about physicians, reimbursement, patients and group practice influences.

A rigorous, high-impact, customer value-based approach should consider several key questions to establish a cross-functional discipline of excellence, such as how many of the metrics have been set based on historical notions of what used to drive prescribing behavior? Have these metrics been statistically tested to determine if they move share today? When was the last time you interviewed physicians to get their perspective on what reps should be measured on? Are you using a methodology that relies on physicians' 'intent to prescribe', not today's advanced patient level data, as a way to predict impact? Are you measuring customer performance at the local level and communicating these results to district managers? What significant actions have resulted from your SFE measurement program in the past 6-12 months?

Experience alone is not enough to drive decisions. There is a new requirement for a higher standard of evidence, including data, analysis and fact-based insight.

What are successful companies doing to improve SFE?

JM. The leaders of these companies are overcoming four common value obstacles. The first obstacle is an organizational mindset that treats SFE as a process check rather than a competitive differentiator. The goal of SFE research should be to find ways to increase market share locally – either at the territory or district level. A second obstacle is generating significant amounts of data, but little proof. The type of proof that generates excitement in the field requires advanced local-level influence analysis, considering promotion, reimbursement and practice influences. The third obstacle is to not making findings relevant for district managers. Perhaps the greatest cost of traditional SFE measurement isn't the cost of the research, but the lost revenue from not pursuing true, verifiable drivers of prescribing. Finally, the fourth obstacle is not paying enough attention to the physician-sales rep relationship. IMS estimates that fewer than five percent of US commercial organizations routinely track their biggest intangible asset – relationships with physicians.

Furthermore, through extensive tracking research with thousands of physicians, IMS has identified four categories of rep behavior that help explain relationship strength and ability to influence prescribing. These include: one, building a mutually beneficial relationship, as physicians seek reps that are valuable to them and their practice; two, removing prescribing barriers as commercial organizations need to understand why prescribers can't write their brand and remove these obstacles; three engaging in valuable information exchange, as physicians and staff value learning and a perception of objectivity; and four, customizing information, tools and resources to the practice, as this drives access and additional opportunities to be valuable.

How can companies better equip their sales reps to enter the physician's inner circle?

JM. Companies can do three things to better equip their reps. First the role of the representative must be defined in terms of value delivery. Reps who deliver high value have more advanced and different skills compared to traditional selling model reps. Understanding the key drivers of value is critical for each specialty area, so that skills can be tuned to exact customer needs and motivations. Two, commercial organizations need to shift focus from rep activity to value received by prescribers. Value delivery is not just the responsibility of the sales organization. Marketing, managed markets and analytics must be equally involved to provide reps with the tools and information needed to be successful. Finally, create a business case to drive the implementation of value-focused execution. Due to the limited impact of traditional SFE programs in the past, many sales and marketing organizations are skeptical of new measurement and tracking initiatives. Since a customer-value focused program goes beyond general information to provide specific market share opportunities and quantifies the impact of improving, a business case can be reviewed with commercial leaders to drive organizational commitment.

What's at stake?

JM. While physicians today are providing less access to their practices than ever before, they are allowing entry to a select number of reps who they believe are providing true value. A customer value program focused on the items valued most by physicians and designed to increase rep productivity can achieve significant results. Despite four common value obstacles, specific steps can be taken to re-energize SFE and deliver ROI. Companies committed to transforming SFE into value for the customer are gaining entry into 'inner circles' and an invaluable leg-up on the competition.

For more information please contact jmoran@us.imshealth.com.

John Moran is Global Leader for the Commercial Optimization Center of Excellence for IMS Health. He has more than 20 years of Rx, OTC and consumer marketing and sales experience spanning a broad range of marketing and sales disciplines. Moran works with many of the world's top pharma organizations, developing new commercial effectiveness models with emphasis on strategies that enable greater customer focus and value.