By now it’s hard to find a medtech company that doesn’t have a commercial strategy in the U.S. to improve its contracting and sales performance with integrated delivery networks (IDNs). It’s also hard, however, to find companies that are completely satisfied with their investment results. Most have implemented some type of key account management (KAM) role to cover some or all of the IDNs. Moderately experienced ones have at least developed some type of IDN segmentation model to sort out those only interested in lower costs vs. those more interested in partnering with manufacturers. More advanced companies also develop segment-level value proposition messaging and more robust offerings that can incorporate product, services and perhaps an element of risk-sharing. Commonly, they also have both a division-level and a headquarters-level focus to implement multichannel/multi-role strategies to better meet the complex needs of this customer. Regardless, even the most advanced companies in this area would be the first to acknowledge that they have a long way to go to perfect their approach to working with IDNs, which begs the question: Is there a perfect IDN commercial model solution to strive for?
Based on our extensive experience with this issue over the last five-plus years, we’re finding that there may never be a single dominant strategy for meeting the needs of IDNs, and in fact the answer seems to be that success will only come to those that support an evolving or agile approach vs. those who seek quick, large-scale change or a static solution. The IDN landscape is changing at a much faster pace than hospitals, surgical centers and clinics, so the pace of change that we’re used to with account-level go-to-market models is far too slow to keep up with the needs of IDNs. Many IDN KAMs say, “If you’ve seen one IDN, you’ve seen one IDN”—that is, they’re all different. That may be an oversimplification, but it’s absolutely correct to say, “If you’ve see one IDN today, it might look quite different tomorrow.” Increasing sophistication, changing market pressures and strategies, and the high pace of acquisitions are all contributing to the pace of change, and the need for an agile commercial strategy from medtech.
While an agile strategy is increasingly a necessity, it doesn’t have to require a large-scale, sweeping organizational change. Instead, companies need to put mechanisms in place that allow them to remain flexible and adaptive, continue learning about their customers, and make improvement tweaks to make continual, incremental success. This can include JIT training, streamlined processes to develop and roll-out new IDN programs, more fluid role definitions, and/or better tools to support cross-team coordination. I like to think of the agile approach as “living on a slope” to help illustrate that the commercial organization should be adept at continually climbing as it learns and adapts from new strategies—and, eventually, outpaces its competitors.
So far, agile strategy examples include not only leveraging an early experience team approach (i.e., a more robust pilot-like program with a continual “adapt, improve, and grow” focus) to launch new strategies but also to maintain a continual “agile” team mentality to support and evolve IDN KAM roles and other key support roles as needed. Another agile strategy supports better market data: Some companies are using crowdsourced input from their KAM team to get updates on key underlying data elements that feed into segmentation models. This lets management know of changing IDN attitudes, strategies and structures in real time, which can then inform updated IDN selling or marketing strategies and tactics. There also can be feedback loops for other departments such as market research, medical affairs or R&D so that these areas can also evolve their investments to better meet market needs.
Regardless of where your company is on the continuum of developing your IDN commercial strategy, it’s imperative that you make room in your strategy for a more agile long-term approach or you’ll be at risk of falling further and further behind—or worse, becoming irrelevant. To help your team be more confident and satisfied in your IDN strategy, I recommend getting them some good hiking boots and encourage them to live (and thrive) on a slope.
By Bret Caldwell, Principal, ZS Associates