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In this series, we’re exploring common mistakes that can cripple your company’s success at getting and retaining pharma clients. Our last post focused on marketing mistakes, ranging from choosing the wrong communication channel to adopting the wrong strategy.
Another common type of mistake we’ve seen companies make when selling to pharma is management, whether at the employee, project, or business level.
Management: Optimizing Internal Performance for Sales Success
Management mistakes often center around internal inefficiencies like outdated processes and misguided hiring practices. By understanding how your business stacks up and where there is room for improvement, you can make the internal changes necessary for more successfully offering your services to pharma companies.
Management Mistake #1: Not Measuring Your Efforts
Measuring the work you and your team put into your business is essential for improving it. How you decide what needs to get done and how you get it done, i.e. your work process, impacts your overall success. And, without measuring your work process, you won’t know where opportunities for improvement lie.
“If what an organization does is carefully designed, you can start measuring what you are doing, make incremental adjustments and optimize your operations,” writes Dan Woods, Forbes.
Harvard Business Review authors Robert Kaplan and David Norton note that while metrics are important, “no single measure can provide a clear performance target or focus attention on the critical areas of the business.” That’s why it’s important to have a broad understanding of how your business performs and where there is room for improvement.
Four areas in particular are important to monitor:
Internal business: What must we do well to succeed?
Innovation and learning: How can we improve and create value?
Client perspective: How can we elevate our client experience?
Financial perspective: How can we increase profitability?
“[Combining] the financial, customer, internal process and innovation, and organizational learning perspectives … can help managers transcend traditional notions about functional barriers and ultimately lead to improved decision making and problem solving. [This] keeps companies looking—and moving—forward instead of backward,” write Kaplan and Norton.
Of course, simply collecting data doesn’t do any good unless you also take the time to understand it and make changes accordingly. The right metrics will reveal parts of your company that are inefficient, where you may be overspending, areas with frequent bottlenecks, and opportunities for a greater ROI.
Metrics can also help predict future business cycles where more or fewer resources are required, leading to increased profitability and reducing the burden on your staff.
Management Mistake #2: Hiring Too Many Salespeople
During my tenure in the pharma industry, I’ve seen hundreds of salespeople for services to pharmaceutical companies come and go. Some were far more effective than others. What stood out to me wasn’t so much the salespeople themselves, but the attitude of those responsible for hiring them. The prevailing notion was that by focusing on hiring salespeople, revenue would automatically follow. These companies often did not see salespeople as revenue-producing investments but a necessary cost of doing business.
By shifting your mentality away from hiring to investing, you can find salespeople that will succeed in their mission: to increase your company’s bottom line.
This sage advice appears in Hire Right, Higher Profits, where author Lee Salz recommends that companies look at hiring salespeople in the same terms as spending on business investments.
According to Salz, great salespeople aren’t hired, they’re developed by their companies. “Greatness is not a standalone quality, but rather a synergistic attribute of the relationship between the salesperson and a specific sales role in the company.”
By investing in the right team and providing them with the right training, rather than just filling seats at the sales team, your company can maximize its revenue and see a return on salespeople investment.
Management Mistake #3: Preferring Salespeople Over Seller-Doers in Consulting
In consulting businesses, clients are really buying the consulting team’s expertise. In these scenarios the people proposing solutions are far more credible if they are subject matter experts.
Sales resources without subject matter expertise may not be effective in consulting organizations, representing a huge hurdle to getting new business. Yet, the subject matter expert often doesn’t have the tools and talents for developing new projects from discussions with prospects and clients.
We work regularly with consulting experts that need help creating opportunities. One strategy we’ve used successfully is productizing, a way of standardizing service offerings to help the consulting team visualize their project and communicate it effectively to potential buyers. This approach also enables prospective clients to better envision how your solutions will benefit them.
Look for a future article on how our process for developing standardized project definitions increases sales.
Management Mistake #4: Under (or Over) Modernizing Your Workforce and Work Process
Workforce Optimization
With 2020 looming, companies that haven’t taken steps to ensure that their team has the tools, flexibility, and resources to accomplish their work expose themselves to lower productivity and higher turnover.
One trend that businesses will need to accommodate is the percentage of millennials in the workforce. By 2020, millennials will account for about half or working adults in America.
While these workers bring strong skillsets to the table, they also have different expectations than their older counterparts. A big expectation is flexibility in working location. 75% of millennials say that working remotely is an important option for them. They also value access to technology that supports their workflows and increases collaboration among their peers.
As important as it is to modernize your workforce, going too far can decrease productivity and waste resources. A recent example is the failure of open office concepts to foster productivity and teamwork. “While open offices were intended to encourage innovation, creativity and collaboration, a growing body of research indicates that, in practice, they may have the opposite effect,” writes Aytekin Tank, Entrepreneur.
The results of open office plans reduced face-to-face collaboration by 70%, a Harvard Business School study found. In addition to fewer interactions, email messaging increased by 50% and researchers noted reduced productivity and work quality.
The failure of open office layouts could have been avoided if companies understood what their workforce really craved, like flexible hours and work-from-home options, and responded accordingly.
Encouraging your employees to focus on outcomes more than hours logged is a proven way to boost productivity and reduce employee burnout. Providing them with the tools, resources, and freedom to concentrate on results is also better for your bottom line.
Work Process Optimization
A modern workforce requires a modern work process to be successful. If you can’t remember the last time you updated your work process, it’s probably a signal that you’re using an outdated system.
Your work process should be standardized and repeatable to help you achieve results. It should organize and direct your steps so that you and your team can stay on track.
Jack Zenger, Forbes, notes that good leaders ensure that an efficient work process is in place to guide their team’s efforts. “The most effective leaders place fervent attention on improving work processes, realizing that when the most highly motivated individual or team collides with a cumbersome work process, the bad process wins every time.”
One major benefit of an efficient work process is that you are empowered to continuously develop and improve new products and services. A modern work process also helps you remain agile and able to quickly meet new demands while better collaborating with your team and clients.
One area we specialize in is modernizing work processes and helping teams embrace more agile ways of developing products/services and delivering them to clients profitably. We focus on value-conscious strategies for leveraging existing assets while creating new resources.
We review tools and resources for both the long term and short term using agile development principles to continuously update and improve results.
Management Mistake #5: Not Getting an Outside Perspective
It’s easy to lose perspective when you’re mired in the day-to-day realities of business. Without taking a step back to evaluate your company’s approach to sales and internal processes, you may become stuck in outdated or inefficient practices.
That’s where having an outside partner can help you. Someone outside of your organization is uniquely positioned to offer actionable insights into how you can improve your business and increase profit.
“In the process of selling and supporting their offerings, [outside consultants] have interacted with other companies in the industry, and they naturally bring a different perspective to issues the client has viewed only from within,” notes Harvard Business Review. “Moreover, [consultants] aren’t caught up in the dynamics that often make it hard for a client’s own managers to challenge the status quo. This hesitancy to make waves becomes stronger in times of general economic turmoil. When people in your client’s organization are too worried about their jobs to present anything original or thought-provoking, it is easier to come across as a much-needed breath of fresh air.”
Our team has experience creating effective management strategies and optimizing internal processes for businesses that serve pharma.
The True Cost of Management Mistakes
Without taking the time to understand common management mistakes and how you will avoid them, your company’s bottom line may suffer. But, by measuring your efforts (and adjusting accordingly), investing in the right salespeople or subject matter experts, ensuring your team can be outcomes-focused, and leveraging the power of an outside perspective, your business will be primed to reap the ROI of an optimized, agile organization.
Contact us to learn more about how we can help your business avoid management mistakes and increase ROI.