Creating A Data-Driven Culture
With the connection between data-driven decision making and financial performance firmly established, what can pharma do to embed a data-driven culture into their organisations?
Companies that rate themselves substantially ahead of their peers in their use of data are three times more likely to rate themselves as substantially ahead in financial performance, according to findings from the Economist Intelligence Unit (“Fostering a Data-Driven Culture”). But creating a data-driven culture is not straightforward and there is still considerable flawed thinking when it comes to integrating data into day-to-day decision making.
Pharma more than any other industry has access to data on our customers and forward-thinking companies will embrace it and use it to foster change".
Appreciating the power of data is, of course, only the first step on the road to a data-driven culture. For older companies, especially those that have achieved success with minimal use of data, the transition to a data-driven culture does not necessarily come naturally. According to Florent Edouard, Commercial Excellence Director, Astra Zeneca, pharma are still playing catch up compared to other industries. “In the past the pharma industry didn’t need to have strong analytics like other industries such as FMCG or financial services; if they wanted more sales they increased their share of voice and more noise equalled more sales. Precise analytics was not part of pharma’s commercial culture because it never needed to be, due to high margins. Now there is a more pressing need to become data-driven and that is a challenge for most as they don’t have the right systems to combine disparate data sources easily, pulling together information about physicians, prescriptions, sales, physician marketing strategies, geography and more to create a clear picture of what's working best. Much of the analytics is centred around controlling what sales representatives are doing instead of gaining insight into physician preferences. Developing a data-driven culture starts with management belief in the benefits of data analysis and putting the right infrastructure in place to facilitate data-driven decision making. Pharma more than any other industry has access to data on our customers and forward-thinking companies will embrace it and use it to foster change”.
Five Steps for Success
The Economist Intelligence Unit report “Fostering a Data-Driven Culture” explores the challenges in nurturing a data-driven culture, and what companies can do to meet them. The report is based on a survey of 530 senior executives from around the globe, together with interviews with four leading industry experts. It outlines five key components to fostering a data-driven culture.
1. Start at the Top
Change often has to start at the top and, without support from the C-suite, it may be impossible to create a data-driven culture. Asked about the strategies that have proved successful in promoting a data-driven culture, half of respondents mention top-down mandates and guidance.
2. Data Sharing
Data often exists in silos sometimes overseen by protective divisional heads. But more than half of respondents from top-performing companies say that promotion of data-sharing has helped generate a data-driven culture in their organisation.
Increased availability of training is a further factor to consider. Around one in three respondents say it is “very important” to have programs or partnerships in place to make employees more data-literate.
4. Communication of the Benefits
The benefits of data are being seen in almost all parts of the companies. When asked to rate the importance of data to different organizational units, 43% of respondents say that data are “extremely important” to strategic decision making. Under 40% say data are extremely important to marketing and communications, as well as finance and accounting.
5. Skills Shortage
Nearly 70% say that it is “somewhat” or “very” difficult to recruit and retain people who are effective at analysing data. The causes of this problem are diverse, but respondents single out a lack of professional expertise among applicants, a shortage of analysts in their sector and high salary costs demanded by data specialists as some of the principal reasons.
Knowing your market and addressing physician needs has taken on added significance and utilising data to reduce waste and target efforts where it will yield most results is a competency that will only grow in importance".
It isn’t easy to create a data driven culture but in terms of the ultimate goal, it is worth pursuing. “Pharma has certainly come late to the big data revolution as the burning platform did not exist previously as profitability was so high. The downward pressure on pricing will propel the industry to catch up and judging by the number that are engaging third-party analytics experts, pharma are redoubling their efforts, using advanced analytics to better direct on-the-ground marketing efforts. Knowing your market and addressing physician needs has taken on added significance and utilising data to reduce waste and target efforts where it will yield most results is a competency that will only grow in importance”, concludes Edouard.
Over the next five years, the marketing function needs to undergo fundamental change to stay on top of changing consumer behavior and channel proliferation. The new marketing organization, powered by analytics and technology and focused on value outcomes, will play a critical integration role across channels and business units. Creating consistent, multichannel experiences that meet customers’ needs, expectations and demands for relevance will be essential to survival in the global marketplace.
Florent Edouard will be speaking at Marketing Excellence Japan, May 13-14th 2014. For more information on his presentation or on other speakers click here.
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