Big Bucks, but no Bang?
Why SFE initiatives fail, and what can be done about it
By on Oct 29, 2007Why SFE initiatives fail, and what can be done about it
Achieving more with less has become a prime strategic necessity for pharmaceutical companies to be able to sustain profit growth. It requires reviewing and changing key sales and marketing processes, structures and culture.
In response to this challenge, many pharmaceutical companies have created internal SFE groups - usually on a global or region level which have the mission to create and drive programs to enhance sales effectiveness in the affiliates.
While the mission is clear, the success record is patchy. Many SFE initiatives produce lots of documents, but little change. Projects tend to lose momentum after the diagnostic phase. Guidelines and best practices are agreed upon, shared and ignored (or forgotten). Even if companies try to enforce standards, many are not, or only partially, implemented, or are re-interpreted.
Why does this happen, and what can be done about it?
In discussions with many participants of SFE initiatives, both in central and affiliate roles, we have found that the reason is usually not - perhaps contrary to common belief - plain resistance from the affiliates, or weak appeal and quality of the recommendations. Nor is it lack of persuasion of the SFE Group.
Often affiliates want to implement, but cant execute the program. The main reason is that it is in the nature of any guideline and best practice recommendation to be just that: a recommendation, an idea.
It is like giving a novice chess player a rule book and a stack of strategy manuals and tip sheets by Garry Kasparov and Bobby Fisher, which are proven to work (for them). However motivated, it will not immediately make him a word-class chess player. It takes much more to build a capability. It takes practice, and ongoing support. But if that is provided, an intelligent player can become very good indeed.
What are the key issues SFE groups need to take into account to create real change with impact on business results?
Enabling implementation is the area that is most commonly under-managed. Affiliates need to be supported beyond the SFE summits and workshops, where guidelines are published, experiences shared, and priorities agreed upon. Back home, for most types of initiatives the affiliates need not only templates, but also user-friendly tools, resources to help drive the initiatives, and involvement of people who have actually done this before.
There is also a real temptation and risk - of trying to achieve too much at the same time, and to trust that giving a toolbox and process outline to the affiliates will do it.
Creating effective sales effectiveness means changing the way the people in the organization work. Like in any change exercise, SFE groups should be prepared to spend significant time in the affiliates getting their hands dirty in the practical implementation to add real value.
The engagement model with the countries needs to be clearly defined upfront. While affiliate ownership is an important part of the process, a define and collaborate approach has proven to be the most effective: best practices are defined and elaborated by the SFE group, the approach is customized with local experts to the needs of the affiliate, and the implementation is a collaborative effort with shared responsibility.
This means SFE groups have to think carefully about which initiatives they could drive themselves, for what areas they should seek outside assistance, and how to internalize this experience over time.
Before committing to priorities and initiatives, they need to make decisions about what type of a team they need to build, what roles and skills they should have internally, and how they will find the right people. Some specific skills may be in short supply, and contingency plans should be in place how to contract support in these areas temporarily.
How much business impact can be expected, and how quickly will it materialize? Realistically, SFE initiatives, even if implemented successfully, will require a multi-year horizon to show significant P&L results.
Being extremely focused and purposeful helps minimize this window - SFE groups need to resist the temptation to be all-encompassing and complete. It is key to spend little time on diagnosis - just enough to create motivation for change and reach agreement on the key improvement areas - and zoom-in on growth drivers quickly. The vast majority of time and resources for SFE initiatives should be dedicated to develop, pilot and implement solutions.
Companies must get SFE initiatives right the first time to maintain momentum and credibility. While SFE is all about learning and developing best practices, looking across the industry today, there is still a lot of room to grow in the running of SFE initiatives themselves, so that more will actually live up to their ambitious expectations.
The path to reach this goal is clear. How many will venture boldly down that path not lured away by the promise of a quick fix remains to be seen.
Torsten v. Bernewitz is a Principal with ZS Associates, a management consulting firm specializing in sales force and marketing management issues, with particular focus on the pharmaceutical industry.
Based in Princeton, New Jersey, he has worked with leading pharmaceutical companies in the US, in Europe, and in the Far East in designing and managing their selling organizations, increasing selling productivity, and managing organizational change.
Contact: ZS Associates
150 College Road West
Princeton, NJ 08540 USA
Tel. +1 609 419 3890
www.zsassociates.com
email:
torsten.bernewitz@zsassociates.com
Author: Torsten v. Bernewitz , Principal, ZS Associates