How to drive commercial excellence through analytics: lessons from two leading pharmacos

Advanced analytics can help pharma companies make better decisions on connecting with customers, with impressive results for those who get it right.

In the pharmaceutical industry, as in all other types of business, there is buzz around advanced analytics. For years, the industry has been at the forefront of using analytics to enable better decisions about how to connect with customers. This article examines how companies use analytics, with examples from two pharmaceutical companies considered pioneers with this business strategy – Novartis and Roche Diagnostics. These case studies provide insights that can guide today's sales leaders on how to use advanced analytics to propel their sales organisations to higher performance.

Analytics for continuous sales force improvement

Beginning in 2001, Novartis used analytics to drive constant improvement across its global sales organisation. Annual sales force effectiveness (SFE) reviews drove at least six consecutive years of growth. Each year, the company identified high-priority SFE projects, executed an improvement plan and measured progress.

Several initiatives led to these significant enhancements. For example, in one analysis the company used customer potential to improve targeting, leading to a large sales increase and improved productivity. Another initiative used 'performance frontier' analytics to identify top-performing salespeople and isolate the 'success principles' that differentiated their performance.

"We propagated these success principles throughout the sales ranks with a goal of boosting the performance of the entire sales force"

According to Greg Schofield, a former executive vice president and head of global sales for Novartis, "We propagated these success principles throughout the sales ranks with a goal of boosting the performance of the entire sales force to levels that had already been achieved by our best salespeople."

By aligning sales force decisions and programmes (e.g. sales process, competency models, a training curriculum) with the success principles, Novartis improved customers' perception of the salespeople and achieved sales growth well above the industry average. Based on its success in the US, Novartis implemented the approach globally.

Roche builds and sustains an analytics-based culture

Roche Diagnostics, another pioneer in the field, was guided by a vision and charter for using analytics to support decisions. The company's sales force achieved an ambitious goal of increasing its market share by three points in just a year-and-a-half.

Bill Lister, former senior vice president and general manager at Roche Diagnostics, explained, "Developing an analytics-based sales culture started at the top. We created a sales strategy to achieve our goals by analysing data using numerous statistical models. We broke down opportunities by market segment and major customers and discovered a targeting and customer coverage strategy that could work. Data and analysis were critical to the process of educating the sales force and securing commitment. By showing salespeople exactly what they needed to achieve their market share goals, we eliminated much of the emotion involved."

Several tactics enabled the company to create and sustain this culture, including a strong and highly respected sales analytics team, processes for using analytics to support every decision and metrics for tracking success.

New technologies help sales analytics reach greater heights

Today's leading-edge pharma companies take advantage of the convergence of mobile, social, cloud and other information to leverage analytics in new ways that transform sales processes and create more customer focus and value.

For example, they can gather analytics from emerging and increasingly important digital channels (e.g. email, virtual detailing and social media) to track customer channel preferences and determine the sales force and other channels' roles in the sales process. Many companies centralise their data and establish centres of excellence that improve sales and customer analytics across countries and regions.

These companies move beyond simply driving guidelines and best practices (e.g. for customer targeting strategies or Key Performance Indicators [KPIs]) and are also creating analytics capabilities. This includes forming analytics centres of excellence, investing in analytical tools or partnering with analytics firms to support business decision-making, enable business processes and drive efficiency.

Big pharma provides three essential lessons

Today's pharma companies can improve their initiatives in using data and advanced analytics by considering three lessons from the Novartis and Roche Diagnostics stories:

1. Create an enabling culture: Start at the top of the organisation and set expectations for analytically-based decision-making. Build and sustain this mindset and culture by putting in place the right team, processes and metrics.

2. Foster continuous improvement: Analytics are not a one-time exercise. When companies implement processes for using analytics to improve decisions on a continuous and ongoing basis and track metrics that measure their success, they can drive constant improvement in how they connect with customers.

3. Focus on decisions before technology: Investments in sales data, technology and analytics can only live up to their promise when companies focus first on understanding the dynamics of the fundamental decisions and processes of salespeople, sales managers and leaders.

Companies that heed these lessons from the past will be most successful in using today's advanced analytics to help their sales organisations create a new level of customer focus and value.

About the authors:

Iain Fratter is a principal with ZS and is based in the firm's London office. He has nearly 20 years' expertise in both sales and marketing, bringing strong analytical solutions to both strategic and operational business problems. His primary focus is to implement technology solutions and operational models to support his clients' commercial organisations.

Stephen Redden is the managing principal of ZS's Operations Capability Group and is based in the firm's Illinois office. He previously led ZS's New Delhi, India office. He has worked with companies across the world to leverage analytics, technology and innovative work models to improve business outcomes. He is also a co-author of The Power of Sales Analytics, written by more than 20 thought leaders from ZS.

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