Barcelona 2015

Mar 24, 2015 - Mar 26, 2015, CCIB, Barcelona

Your Customer is in Charge.

Can KAMs build true partnerships with clients?

Compliance issues may be hampering the commercial co-creation process between pharma and its key customers, Anja Schmidt-Fink of Novartis tells Nick de Cent.



Key account managers have moved on from the stage of being “super-reps” to much more of an entrepreneurial focus. However, their ability to be creative and craft solutions for the clients is heavily constrained by regulation, argues Anja Schmidt-Fink, Head of Key Account/Channel Management for Novartis in Germany.

At the same time, the marketplace is primarily driven by cost and political concerns.

“The government is driving the idea of how we deal with healthcare,” she tells eyeforpharma. “That is driving what KAM can do to supply the patients.”

The twin drivers of cost and regulation mean that KAMs have to work hard to avoid negotiations based around simply offering more rebate or bundling other brands. Nevertheless, there are opportunities to be creative and these run beyond strategies such as funding a conference or supporting exhibitions.

They’re more entrepreneurial in their thinking and they have more freedom and responsibility. We want to understand what drives value.

"Big pharma companies can also provide advice to payers and providers, perhaps in relation to generating supply chain efficiencies or by providing specialized scientific knowledge and support as well as learning opportunities; this might include privileged information relating to specific patient pathways or insight around certain combinations of products. That said, pharma company lawyers tend to be “very cautious” about relationships that can be perceived as too close. “It’s super sensitive,” Schmidt-Fink admits, “90% of the time we’re not allowed to do this kind of activity.”

As a result of such constraints, pharma KAMs remain very product-centric in comparison with many other industries, albeit that their aims are similar: to grow an account rather than simply shift a specific product. Their remit is to develop a broader and deeper relationship with clients, which in Germany tend to be the large hospital chains, purchasing groups and payers.

“In the past, a KAM was just a kind of rep for hospitals,” she explains. Now, they are much more autonomous with a requirement to have access to all kinds of management levers within the client account. Today, they manage their company’s whole brand portfolio, while reps are dedicated to a brand or group of products. “They’re more entrepreneurial in their thinking and they have more freedom and responsibility. We want to understand what drives value.”

Customer perspective

Clients’ perception of KAM has moved on too, so that they are looking for a sustainable and reliable relationship. It is this strength of relationship that enables KAMs, for instance, to trouble-shoot supply issues on behalf of a client while maintaining a positive perception of their company. Consequently, there’s a lot of internal marketing involved, with the KAM representing the client back to the company. “If a hospital pharmacist has an issue, he calls the KAM first.”

So what makes a good KAM from the customer’s perspective? “If a person asks a question, you will answer very quickly". The role involves listening, understanding and then coming up with a tailored solution or else you need to be open and say “Sorry, we can’t do this”, she explains.

Schmidt-Fink has ten KAMs working with her. Some are former reps: “It’s not so easy for them to forget their former ways,” she agrees. So what kind of qualities does a good KAM need in her view? She lists several qualities:

  • Understanding of the full system including all the commercial aspects and the political dimension, along with the ability to cascade this down to the account level – this includes a full understanding of all the product benefits;
  • The ability to be creative with the customer in an entrepreneurial way;
  • Good communications ability;
  • Being good at negotiation;
  • Can’t be too young – a good KAM needs “a certain seniority”;
  • A facility to communicate internally that the KAM understands the needs of the account – this may involve a lot of internal marketing; and
  • The ability to balance sales skills with entrepreneurial and management skills – to take the account to the next level, like it’s your own business.

This latter element is critical, Schmidt-Fink stresses. “The KAM has to understand the management side of the role. There is no daily schedule but every month I am looking for a positive experience. KAMs are targeted in a different way from reps, and with specific KPIs less aligned to call rates. Also, because they are more autonomous, developing a good account plan is an intrinsic part of the process". 

Working on behalf of the customer within the KAM’s own company is also an essential element of the role and this includes operating alongside reps, the marketing department and market access specialists. KAMs may also accompany medical liaisons but strict German regulations separate medical and commercial operations. “A KAM can bring a medical person to a meeting but the KAM has to leave the room,” Schmidt-Fink explains.

The future of KAM

What can pharma KAMs learn from other industry sectors? Again, they are heavily constrained by compliance concerns but Schmidt-Fink is particularly interested in finding ways for account managers to sit down with their accounts and work alongside each other to develop the best solution together. “You go on that journey together. It’s something I really like; there’s a lot of connection.”

This kind of co-creation is rarely feasible in Germany today, although it can happen – “It’s a slow process,” she acknowledges. That said, Schmidt-Fink does insist that her KAMs have a deep understanding of what drives their account, including their business model. “It’s something I like the KAM to understand, beyond just offering rebates.”

As co-creation progresses, with less emphasis placed on traditional negotiation, there is an opportunity for it to play a role as part of the Novartis Customer First concept, Schmidt-Fink suggests. Further down the line, she predicts that KAMs will behave less and less like traditional salespeople and engage in a different type of collaboration, using more of a consultancy sales approach, with KAMs positioning themselves as partners with their clients.

To achieve this, KAMs will need to push back when internal colleagues expect a quick win or short-term commercial solution. “There is no such thing asa quickwin in sustainable key account management", she concludes.


Anya Schmidt-Fink of Novartis will be presenting at Barcelona 2015, March 24-26th. For more information, click here.



Barcelona 2015

Mar 24, 2015 - Mar 26, 2015, CCIB, Barcelona

Your Customer is in Charge.