eyeforpharma Barcelona 2014

Mar 18, 2014 - Mar 20, 2014, Barcelona, Spain

The Future of Pharma

The Path to KAM Implementation: Moving Towards Collaborative Partnerships

Deirdre Coleman investigates the practical complexities of implementing a Key Account Management structure in the pharmaceutical industry and how the correct approach can pay dividends.



More and more pharma companies are now addressing the changing healthcare market by transitioning the sales process from one which primarily involves sales representatives engaging with healthcare practitioners on a ‘one-to-one’ basis, to the establishment of Key Account Management (KAM) teams. The KAM transformation process can be fraught with difficulty with a successful implementation necessitating some critical steps. However, separating the theory from the practice can be problematic as can arriving at a KAM approach that works within the confines of a highly regulated, increasing complex healthcare market.

Defining KAM: Theory v Practice

Allan Mackintosh, Senior Business Account Manager with Grunenthal UK is well-positioned to share his company’s experiences of undergoing a KAM implementation process. Mackintosh believes that companies on the cusp of implementing a KAM approach should firstly avoid a strenuous adherence to theoretical definitions of what KAM is and can achieve but instead concentrate on the key business principles behind KAM and how this approach can enhance the company’s ability to deliver on business objectives.

“For me KAM is centred around building a high level of knowledge about your customer, the complex environment in which they operate and the challenges they face and based on that critical insight, working towards developing strategic relationships based on trust and credibility; only then can you commence utilizing a broad range of skills, working in partnership with customers to come up with mutually beneficial solutions. To me that is what KAM is about. The important thing then is to apply this approach to your company your way, taking into account your company’s values, culture and overall approach”.

KAM is not something that can be implemented overnight. It can be a painstaking process requiring organizational change that takes time and huge commitment to implement.

“Four years on in Grunenthal we are still not there. It’s a mindset, a new approach which necessitates huge movement away from the traditional “Share of Voice” sales approach or what I view as shouting messages at customers to a more value-based approach built on listening to the customer, building strong relationships, then working in partnership to deliver a value proposition to the consumer that is of mutual benefit. Change does not happen quickly and previous methods of operating get ingrained. But that mindset ultimately has to change and therein lies one of the biggest challenges facing this industry”.

The Path to Key Account Management

KAM is indeed a major change, but there are a number of key success factors involved in its successful implementation:

# 1: HIGH LEVEL BUY-IN

Key Account Management offers a much more strategic approach to nurturing key accounts. However, according to Mackintosh, its successful implementation hinges on buy-in from high level management as without their support it simply won’t work.

 “Senior leadership needs to be fully committed to the merits of changing to a KAM structure. They have to live the plan so they need to be fully on board and align their teams to the overall company strategy. It involves a shift in thinking from a transactional approach to a strategic approach, often necessitating a longer-term view over and above quick wins. Leaders need to assess whether they are instilling a culture that supports innovation and building value added solutions for their customers. KAM can help deliver outstanding results, but only with a robust and structured management process”.

# 2: DEVELOP A VISION AND YOUR OWN VERSION OF KAM

“I can’t stress enough the importance of developing your own company vision and your own Key Account Management model that works for you. In Grunenthal, our sales management project group developed a model which we call the “5 A’s”

  • Access – Our medicines are accessible
  • Autonomy – Our customers have the power & confidence to Rx
  • Activity – We deliver the required customer activity from the Account plan
  • Ability – We continue to develop our Knowledge and Skill
  • Advocacy – We support the development of our KOLs

 

# 3 DEEP CUSTOMER INSIGHT

Customer insight is crucial to developing credibility and trust with the consumer. The pharma industry needs to play catch up when it comes to moving away from a reach and frequency model to a more involved collaborative partnership centred around developing value propositions that address the needs of prescribers, policy makers, patients and payers. Knowledge is a vital component of becoming a trusted partner; from that knowledge comes respect, credibility and ultimately trust. Before a customer is going to be willing to try your medicine with their patients, they have to trust you.  True partnership can’t happen unless there is trust.

# 4: ASSIGN THE TEAM

Carefully select the “Account Planning Team” with the right complement of skills to develop a robust account plan. This is a cross-functional team composed of dedicated and indirect personnel.

# 5: ENTREPRENEURIAL FREEDOM FOR KEY ACCOUNT MANAGERS

The skill set required of a Key Account Manager is vastly different to that of the traditional sales representative.

 “Thinking like a business owner helps executives see their business in a different, more enlightened way, placing the onus firmly on them to develop a more creative mindset when approaching problems. It is this sense of ownership and entrepreneurial thinking that is the key to unlocking the complexities of influencing disparate stakeholder behaviours, thereby promoting innovative approaches to delivering true value added solutions”. There is the added challenge of being entrepreneurial within a compliance culture but this can be achieved with the right company culture and managerial support.”


# 6: DEVELOP AN ACCOUNT PLAN

This is the working document that contains the tactics and plans to achieve the objectives for the coming year. It must be aligned to multi-years strategy and based on a deep understanding of the customer.

# 7: MEASURE AGAINST AGREED OBJECTIVES

Conduct regular key account plan review meetings to monitor the action plan and sales results that are integrated in company-wide review cycles.

Optimizing the Consumer Experience

Progressing towards a KAM mindset involves more than rebranding current sales representatives with the KAM title. KAM critically depends on how the implementation is done, in terms of cultural and structural changes. Any KAM  implementation also takes longer than the organization thinks it will, maybe four, five or six years.

“It’s a company-wide journey that permeates throughout and involves huge organizational change. Too often people see this as an alternative way of selling. It necessitates huge investment in terms of committing resources to retraining staff, coaching from a managerial level, hiring new talent where there is a capabilities deficit. “You need to take a holistic approach to enable the company to align the structure of its sales organization, with the right talent and sales processes for maximum revenue performance. The role of the Key Account Manager is more akin to an entrepreneur who has a much more strategic, top-level approach and has the required level of knowledge and competencies to untangle the complexities of the healthcare market and the decision makers involved. When it is implemented properly, a KAM approach optimizes the resources within the organization to best serve the needs of the customer; this has to yield dividends in terms of building strong relationships with your core customers based on trust, credibility and a collaborative approach to delivering value”, according to Mackintosh.

Key Account Manager as Customer Advocate

In order to best serve the needs of the customer, it is vital for the focus to shift from the traditional Share of Voice approach towards genuinely listening to the customer, identifying their needs and challenges and becoming truly customer-centric as opposed to brand-centric in approach.

According to Chris Morgan, Principal, ZS Associates, the Key Account Manager can play a key role in acting as an advocate for the customer, listening to their concerns and challenges and identifying how best the pharmaceutical company can address their problems.

“While KAM as a capability is a team game, it’s critical that there is one person assigned to act as an advocate for the customer to the pharmaceutical company, relaying their challenges and requirements. A truly customer-centric approach would see the Key Account Manager as a trusted voice for the customer, responsible for getting the most out of the pharmaceutical company to deliver real value. In industries where KAM is at a more progressed level, the companies have in fact adopted their customers’ success metrics or KPI’s as their own. This demonstrates how genuinely invested they are in their customers’ success”.

Therefore, the role of the Key Account Manager becomes one of a listener and a problem solver as opposed to a disseminator of company messaging. This is a vastly different skill set and requires a huge cultural shift in the way pharma operates.

“Success ultimately depends on the Key Account Manager delivering real value to the customer. Real value will always come back to improving healthcare outcomes and reducing cost”, says Morgan.

Collaborative Partnerships

The future lies in intensive co-operation between pharmaceutical companies and their stakeholders. Key account teams have to work as local partners, showing they can share the objectives and needs of their customers and can support them with technical and management skills. In that way, the KAM teams build relationships and trust. This will enable the teams to establish joint working projects.

“It’s important to remember that a KAM team has to be a collaboration; it’s not just naming a key account manager. The team needs to offer the full range of capabilities and value that the firm has to offer. It has to be a team effort, a group dynamic. Ultimately, the goal should be making customers part of the team. That’s what key account management is all about”, concludes Morgan.



eyeforpharma Barcelona 2014

Mar 18, 2014 - Mar 20, 2014, Barcelona, Spain

The Future of Pharma