The Challenge of KAM in an Evolving Provider Landscape
As more customers shift from a volume-based business to one that is driven by value, pharma will have to change their model of customer interaction. Recognizing the need for a key account management approach is all very well; successful implementation is another issue entirely.
We recently spoke with Matt Pitzel, National Director, Key Account Management, Pfizer, who having been at the heart of Pfizer’s evolving KAM offering, is highly aware of the uncertainty that both pharma and providers find themselves in. Matt elaborates, “Physicians have one foot on the dock in volume, and one foot in this rickety canoe called value. But when should someone really make a decision to move from volume to value? No one really knows in what direction the canoe will take off, and pharma is in a similar position. We still have the traditional sales rep model based on high frequency visits to physicians, but we are going to have to step into the canoe at some point. Physicians continue to lose power and we are transitioning towards organized systems defined on value.”
In order to stay relevant and maintain influence, the mind-set at Pfizer is that it is better to move with the customer. If you wait, it might be too late. Developing influence with these new systems is really the idea behind KAM in pharma.
So where do you start? While Matt identifies the KAM role as being suited to both market expansion and brand building activities; at Pfizer they have chosen to prioritize the former. In order to understand why, Matt reminds us that we must try and see from the customer perspective. Matt points out that the customer isn’t really thinking about how they can use more of a given product; instead they are focused on how they can improve the management of priority diseases. Having a traditional product focused conversation just isn’t aligned to these needs. However, if you have a conversation on how you can help them identify at risk patients and help reduce the need for more expensive treatment routes, such as hospitalizations, then this is a situation where everybody wins. The provider, the payer, pharma and most importantly the patient, all benefit. This is really the idea of market expansion.
Do you need to be the market leader for Key Account Management to work?
While it is clear that you should focus on disease states where you possess a core competency in order to be able to deliver value, what about scenarios where you are not the market leader?
Matt observes, “You don’t actually have to be the market leader, but of course you need to have some level of market position. When making a decision whether or not to get involved you need to have an understanding of where your commercial strategy is headed in general. If for example you are at 5% market share, but your marketing & traditional sales force have expectations of reaching 20% in 5 years, you will still benefit from growing your anticipated share of the market. It will take time for results to show from KAM anyway, so this is a good time to get involved. All your commercial strategies have to be designed to come together at once.”
Three rules for KAM:
- Understand your value proposition to your customer
- Identify areas where you can help the provider
- Develop tools that emphasize easy collaboration
Throughout our discussion, Matt repeatedly underlines how important it is to have both executive buy-in and strong leadership for your KAM team at a regional level. Unless you have access to the resources that you need to build out a proper KAM value proposition Matt observes, “You are sending them out into the field naked. If they don’t have an identified value proposition then they will just make something up when they engage the customer. This isn’t ideal.”
Everything that you give to the provider is above and beyond their day job. Any opportunity you bring, you must bring a solution as well, otherwise they are just going to carry on with their day job and focus on getting that done".
The first step in creating appropriate resources is to understand what your target disease area means to your customer. You need to understand how much it is costing them, and how much they stand to improve.
The next step is to develop ways in which you can work with the provider to help, from diagnoses, to treatment, to patient outcomes. Working with the provider will give you the insights that you need to make this decision, whether it is to help identify patients, improve the consistency of how they treat patients or to assist their processes in measuring patient outcomes.
Once an area is identified, the final component is to actually build a solution around the problem. However, any solution designed must be easy to use. Matt cautions, “Everything that you give to the provider is above and beyond their day job. Any opportunity you bring, you must bring a solution as well, otherwise they are just going to carry on with their day job and focus on getting that done. You need to make it as easy as possible to work in new ways.”
Is KAM an exact science?
Matt does not believe that anyone in pharma is at the stage where they have got their KAM strategy exactly right. For Pfizer the next step for Matt & his team will be to personalize their training offering to accelerate the development of their KAM field force. Staying ahead of how the provider landscape continues to shift is the priority and until it settles everyone will need to be nimble with their KAM offering.