Everyone in pharma is talking about key account management – but what does being a KAM mean for the sales executive?

What is key account management all about? Perhaps an anecdote will help...

A travelling salesman was on the road and stopped in a small Somerset town. There appeared to be no hotel and the local pub had no rooms available. So he drove out to the nearest farm and knocked on the door. An ageing man answered. The rep explained his problem and asked if the farmer had any rooms available. “Sure,” the old man said. “My 19-year-old daughter normally lives here but she’s away at college, so her room’s free.” The rep nodded and turned back to his car. “Hang on,” the farmer said. “I said there’s a free room.” “I’m sorry,” said the rep, “I’m in the wrong joke.”

The point is that a traditional sales rep has a well-defined script, a known role, within which certain messages and behaviours are taken for granted. The rep just has to make contact and deliver the message. That’s why he or she is the butt of so many jokes. It’s also why the traditional sales role is disappearing from our information-charged world of informed customers and organisations that make decisions on a committee basis.

Read the joke again and think of it as a metaphor for a modern business relationship.  The farmer’s spare room stands for the technological and human resources the customer can draw on. The farmer’s daughter being in college stands for the customer’s new education and range of business contacts.

To employ a technical metaphor, if the traditional sales executive is a plug looking for a socket, the key account manager is a USB flash drive from which a wealth of complex information can be downloaded. The KAM is not only addressing a plurality of customers but representing a plurality of company perspectives: sales, marketing, research, finance and management.

You’ve heard of cloud computing. Key account management is cloud selling – a way of bringing together the best elements of your company’s business strategy with the key aspects of the customer organisation’s business strategy. That classic business cliché, my people will talk to your people, is at the heart of KAM.

Meeting the family
Key account management assumes that the individual customer belongs to a complex buying environment – he/she is influenced by a range of people and uses a range of information resources. The appropriateness of this model to the NHS is obvious – and while the current NHS reforms affect the structure and workings of key healthcare accounts, they certainly do not dilute the need for such accounts. The KAM has to work with the purchasing system by identifying, and building relationships with, its most sensitive points of contact.

Identifying the decision making units within the customer organisation and working strategically to maximise your company’s impact on them is half of the battle. The other half is directly or indirectly bringing the key elements of your own company into contact with the customer organisation. This is where new technology comes into its own: nothing will make connections better than well-presented information that conveys the richness and immediacy of your business case. Tablet computers and smartphones also make the co-ordination of KAM within your own company swifter and easier.

As many pharma companies have found out, simply creating a KAM role in your sales team and expecting that to make all the difference is foolish. KAM is a function of the whole company – which seeks to meet the needs of patients via the health systems that provide treatment. The product reaches the patient via a treatment pathway that the health system develops according to its clinical and financial priorities. That pathway and the reasons for it are what the company needs to understand and change.

Looking after people
Pf spoke with Paul Curbbun, National Key Account Manager at Rosemont Pharmaceuticals. Before taking on his current role, Paul was National Hospital Manager for the same company. Before that, he was working in FMCG and other sales sectors – where KAM has been prevalent for two decades. So Paul is the KAM who came in from the cold.

On how his working life has changed, Paul says: “My life hasn’t got any easier or any harder. The only thing I’ve cut down slightly is the mileage. I’m at home more than before because I tend to use home as my office. For instance, this morning I’m spending two or three hours at home preparing before going out. There’s a lot more reports to put together as well as analysis of sales.”

On the changes in his customer base, he observes: “As NHM, I was seeing everybody – pharmacists, nurses, doctors, therapists. That’s all gone now, and what I’m seeing is mainly the buyers from the key groups, from specific retail groups to wholesalers. A lot of what I’m doing is building up business partners.”

What KAM is all about, he argues, is looking after customers: “Nothing feels better than when you’ve asked for something and you get that something. It’s about not letting people down. It’s truly looking at their business and your business and linking the two together for the benefit of both.”

That contrasts with the traditional pharmaceutical sales role of hammering the product and the marketing message. The key account manager needs to identify opportunities and develop solutions, using the company’s product portfolio to optimal effect. “Whatever the account needs – it’s that simple.”

Don’t be a stranger
Rosemont Pharmaceuticals specialises in oral liquid medicines for people who have difficulty with tablets. Their products include a formulation of the diabetes drug metformin. With a clear USP and well-defined patient population, surely this is a case for traditional product-based selling? By no means, says Paul: “It’s critical that when a patient needs an alternative, a patient gets an alternative. So from a key account point of view, you can make sure our products are where they need to be, so that patients get the right medicine and, most importantly, there is continuity of supply.”

For the sales professional, Paul states, the difference between KAM and their previous approach depends on how well they did the latter. “If you’re making calls for the sake of it, just to tick a box, obviously that’s a long way off – but if you’re going into an account with complete business focus, asking what it needs, closing the loop whenever an opportunity arises, you’re well on the way to a KAM role.” Sales professionals who analyse their sales and construct a business-focused customer database are also showing KAM awareness.

For the sales manager, the key to effective KAM is empowering the sales team to manage and take ownership of their accounts while guiding them to optimise their work as a team. KAM is not a solo activity. Paul remarks with some bafflement: “Something I could never get my head around was the fact that you often had four or five people selling the same drug over the same area. If you were devising a business model tomorrow, that would certainly not be it.”

In fact, KAM is so integral to modern business that it’s worth asking why the pharmaceutical industry avoided it for so long. The answer lies in its assumption of a difference in professionalism and consciousness between seller and buyer. For decades, pharma regarded its customers as business-naive people fixated on the patient relationship. Hence the adoption of ‘persuasion’ techniques such as NLP.

Times have changed, and bad business habits now carry too high a price. As the NHS – with its emphasis on cost-effectiveness and generic prescribing – becomes more like a business, and the industry – with its emphasis on patient-centred medicine and disease area knowledge – becomes more like a doctor, a shift from sales transactions to commercial relationships is essential for both. KAM is pharma’s only way in from the cold.

Despite huge investments into CRM systems some pharma companies still struggle to get all of their staff to embrace and fully interact with them. Pf’s Iain Bate explores why, and what the future holds for technology in the industry.

There’s no doubt that technological developments have changed the way we live and work from year to year – maybe even from month to month in the 21st Century. But has the world of healthcare been travelling in the slow lane of the intergalactic highway?

The potential that technology offers to pharma, and the general world of healthcare, is enormous. But is the pharmaceutical industry, and its staff in particular, using it to maximise the returns of billion-dollar investments?

It would seem that technology is the ‘buzz word’ on the lips of a few of healthcare’s major players at present. The DH recently invited people to nominate their favourite health-related mobile phone ‘app’ – be it for keeping fit, to locate a hospital or chemist, or helping to manage an illness. Creative minds were also asked to design their own health app with a panel of DH judges deciding on their favourite from the most popular entries.

Health Secretary Andrew Lansley says it’s the Government’s intention to give people better access to information using modern technology and the exercise is a “unique opportunity for the NHS and those who develop apps to not only showcase their work, but to bring to life new ideas and realise true innovation in healthcare”.

As part of the DH’s technology revolution, patients may also soon be offered online consultations with their GPs using programmes such as Skype. Clearly the Government is embracing the convenience technology offers to patients, but are other sectors in healthcare as interested? It would seem there is still some way to go.

 

In two minds

Pf ’s 2010/11 annual Company Perception, Motivation and Satisfaction Survey suggests that not all respondents are completely convinced by the power of technology in the workplace. Although the Survey – which relates to 2010 and the early part of this year – found that nearly 90% of respondents have access to a CRM system, only 43% find time to use it in the field and more than a fifth of people fail to accurately record post-call reports with important clients.

Questions have to be asked as to why, despite multimillion pound investment and training by pharma companies, there remains a percentage of staff that still ignore the power and potential of the technology at their finger tips.

Results from the Survey reveal there’s no difference in uptake by key account managers, primary and secondary care representatives, those in primary care roles only, firstline sales managers and secondline sales managers and the use of CRM technology between differing age groups – although surprisingly 10% of respondents in these positions with less than two years of experience said they did not have a CRM system, compared to just 5% more experienced colleagues.

The launch of the iPad in March 2010 promised to revolutionise the way sales representatives, and those in similar roles, use CRM systems in the field. However, nearly three-quarters (70%) of respondents from the Survey are still presently sent out with laptops containing their customer-relationship systems.

When quizzed on what they’d change about the hardware which houses their system, the majority of respondents said that their CRM was too awkward to carry, with poor running systems an issue and that batteries ran out too quickly. Apple claims its second-generation iPad now enjoys ten hours of use away from a plug socket in the field.

Yet the switch to the latest convenient tablet devices may not necessarily be about high levels of investment, it may be down to maximising value for money as Paul Shawah, Vice President, Multi Channel Strategy, Veeva Systems explains. “I would say the life cycle of devices within the industry is generally about three years, sometimes a little bit longer,” he said. “When a company invests in new technology they typically depreciate that over that period, so they don’t want to replace it in the field for that time to maximise their investment.

“However, with the introduction of game changing technology like the iPad, this has changed. We see a number of our pharmaceutical customers are justifying the business case to move to the iPad even before their tablets are fully depreciated. This speaks to the business benefit that pharma expects to achieve from the iPad and the related applications only available on that device.”

A convenient shield

Despite technology eliminating mundane process in the workplace and offering the potential to assist employees and improve their efficiency at work, it has historically been used as a shield to mask poor performance and abused as a means to waste company time – a recent online survey by AOL found that nearly half of Americans (44.7%) rank surfing the web as their primary activity during the two hours they ‘waste’ each day at work.

But it would seem that a high number of respondents do value the opportunities CRM offers. Almost two-thirds (64%) said they always enter correctly the amount of customer sales they make into their CRM. But 21% admitted they fail to always report face-to-face meetings with clients. More surprisingly, over a fifth of participants said they do not always record the number of products they had sold to clients.

The lack of honest accuracy is surprising considering the amount of time spent using CRM systems each day. A third said they spend between one and two hours a day on their system with a fifth spending three hours or more on their CRM. During their time using the management system, more than half (55%) said that call reporting was the most useful feature.

Although respondents were less impressed with the KAM abilities of their software with only 19% believing it to be the most useful facility. When questioned about what they would change given the chance, 45% said they wanted an improved database, over a quarter (28%) called for their system to be overall more useful, and 18% said they would prefer their CRM to be easier to use.

 

The next level

But what of the future of CRM systems? Will they be easier to use and have improved customer databases? David Round, General Manager, UK, Cegedim Relationship Management, says the regular interaction we now have with technology means we’ve all come to expect the latest developments.

“End users are significantly more ‘technology-savvy’ than their counterparts of even five years ago,” he explained. “If anything, the challenge for companies is to ensure that they provide their end users with the types of technology that they use as consumers. It’s also important to focus on the usability of your software to ensure maximum use. Technology companies – and pharma – must work together to develop a better understanding of the interaction, to ensure it meets users’ needs in the field.”

One main reason that users have become more ‘savvy’ is down to the use and interaction with social media. Whether at home or at work, websites such as Twitter, Facebook, LinkedIn and most recently Google+ have driven an increased use of various forms of technology – especially on devices such as smartphones or tablet devices which reps are calling for in the field.

Pharma companies, both in the US and UK, have flirted with the idea of fully embracing the power social media harnesses, but at present are restricted by the PMCPA’s Code of Practice and by the FDA – who has again delayed the publication of its guidance.

The FDA says it is “difficult to provide a timeframe... due to the extensive work and review process, or ‘Good Guidance Practices’, which ensures that FDA’s stakeholders are provided well vetted guidances articulating FDA’s current thinking on a topic”.

Although the FDA may be unsure on how to direct healthcare companies, David Round believes the introduction, both professionally and personally, of social media has had an impact on staff and their expectations.

“For the modern professional person, much of their everyday life is conducted online – for example on shopping, utilities, insurance or booking a holiday – and many users then want the same level of capability from the tools they use in their job,” he added.

Dan Goldsmith, General Manager, Veeva Europe, agrees there has been a significant shift in the way we operate and interact due to our experiences online through tagged posts or hash-tagged searches. But although the 800 million users on Facebook – more than half which ‘log-on’ every day – and 175 million people on Twitter have no problem saying hello to friends, pharma finds it more difficult reaching out to people.

“Social media create a new avenue for healthcare dialogue and will only continue to pervade our lives,” said Dan. “Consequently, I believe that pharma faces two challenges. The first is to decide how to participate in the online dialogue with stakeholders and then to create those interactions through the channels we’re all familiar with, such as Facebook and Twitter.

“The second is to figure out how to leverage the model of social dialogue internally to support stronger collaboration and more focused communication among employees. Already, we see some companies taking advantage of the latest social business tools to connect employees with one another and to access and share information in real time.”

Clearly CRM solution providers understand the potential modern technology and social media platforms offer to companies. Whether pharma and its workforce get fully up to speed on the intergalactic highway sooner or later remains to be seen.

Par Pharmaceutical has acquired worldwide rights to three products belonging to Teva Pharmaceuticals in connection with the generic pharma company’s buyout of Cephalon.

Under the agreement, Par will own Teva’s fentanyl citrate lozenges, a generic version of Actiq, and the generic version of Amrix (cyclobenzaprine ER capsules). The deal also includes the US market rights to modafinil tablets, the generic version of Provigil.

Annual US sales for Actiq and its equivalent generic products have been reported at $173 million, with $1.1 billion for Provigil, and $125 million for Amrix.

Teva Pharmaceuticals won a race against Valeant to acquire Cephalon, buying the company for $6.8 billion in May 2011.

Novartis has received approval from the European Commission for the use of Afinitor (everolimus) tablets to treat patients with advanced pancreatic neuroendocrine tumours (NET).

The decision was based on Phase III data which indicated the tablets more than doubled the time without tumour growth.

Hervé Hoppenot, President, Novartis Oncology, says the approval means thousands of patients “will have a new targeted approach” for the aggressive cancer.

The decision applies in all 27 European Union states, plus Iceland and Norway. Novartis are also currently seeking additional regulatory submissions across the rest of the world.

The RADIANT-3 Phase III trial was the largest clinical trial to date in advanced pancreatic NET. Results found that Afinitor reduced the risk of cancer progression by 65% when compared with placebo in patients with advanced stages of the disease.

An improvement in progression-free survival was also found in all patient subgroups, including those who had not received prior chemotherapy.

Afinitor is currently approved in the EU for the treatments of patients with advanced renal cell carcinoma (RCC) whose disease has progressed on or after treatment with vascular endothelial growth factor (VEGF)-targeted therapy.

It is also approved in Europe for the non-oncology patient population under the trade name Certican for the prevention of organ rejection in heart and kidney transplant recipients.