Sustaining high performance through

customer centricity
How customer-centric business
models drive growth for
pharmaceutical companies
2
Contents
Executive summary 3
Current challenges 4
What pharma companies can learn from other industries 6
Customer centricity and new business opportunities 10
Accentures approach to customer-centric transformation 16
Customer-centric organizations and
high performancecritical success factors 20
Why Accenture 22
3
Executive summary
At a time when the pharmaceutical
industry is being affected by a
challenging business environment,
the altering marketplace and the
changing customer landscape, the
need for pharma companies to focus
more intently on customers is
becoming more crucial than ever.
Over the past decade and a half,
the decline of the blockbuster
model combined with a sea
change in perception about the
interrelationship between pharma,
health outcomes and overall health
care costs has unseated the
physician as prime customer,
expanding the customer landscape
to encompass physicians, patients,
payers, health care regulators and
health care institutes.
There is no other way around
this dramatic change than to shift
from the global pharma industrys
traditional product orientation to a
customer-centric approach pioneered
in industries such as retail, consumer
goods and telecommunications.
The era of customer centricity in the
pharmaceutical industry has arrived.
A customer-centric strategy makes
customer relationships a major
dimension for driving business
performance, along with shareholder
value, employee satisfaction and
corporate stewardship. In addition,
a customer-centric approach
harnesses corporate resources
from R&D and sales to customer
intelligenceto create relevant,
unique and differentiated products
and services adapted specifically
for each customer segment.
In this study, Sustaining high
performance through customer
centricity: How customer-centric
business models drive growth for
pharmaceutical companies,
Accenture outlines current market
and customer landscape changes.
Accenture draws on lessons learned
from other industriesand from
pharma industry early adoptersto
demonstrate how industry players
can adapt to customers that demand
renewed customer engagement via
customer-centric business models.
Along with defining and illustrating
customer centricity in detail,
Accenture provides a five-step
customer-centric transformation
offering that enables pharma
companies to build the customer-
centric organizations required to
adapt to seismic changesand to
enable growth. This study also
outlines new business opportunities
that a customer-centric approach
makes possible and outlines the
critical success factors for pharma
companies that aim to harness
customer centricity to deliver high
performance.
4
Pharma companies currently face a
challenging business environment.
Given both significant changes in
the global marketplace and in the
customer landscape, the pharma
industry must rethink its current
business models to journey towards
high performance. Investments in
blockbuster medicationscombined
with one-dimensional sales and
marketing approachesare no longer
capable of delivering expected
revenues or profits.
Key market changes
From todays market perspective,
pharma companies face the risk of
significant sales decreases and
margin pressures. This new reality
can be attributed to three trends:
patent expirations, research and
development (R&D) productivity
declines, and regulatory and
competitive shifts.
On the patent side of the equation,
pharma organizations risk significant
revenue losses as patents for
blockbuster drugs expire. Some
industry analysts predict that the
drop in sales of mature products
could yield losses of $115 billion
between 2007 and 2012.
On the R&D side, a decrease in
innovation productivity threatens to
lead to shrinking return on
investment among newly approved
drugs. Additionally, next-generation
pharma efforts tend to produce drugs
that are so niche oriented that they
might not possibly generate enough
revenue to offset revenue losses
resulting from blockbuster-patent
expiry.
Finally, regulation and competition
are forces to be reckoned with.
Margins are diminishing dramatically
because of stringent regulatory
measures, and because generic and
bio-similar drugs are becoming
increasingly dominant in the
marketplace.
Changes in the customer landscape
In addition to market pressures,
pharma companies face an
increasingly complex customer
landscape based on two major
trends:
First, drug approval and prescription
by physicians are being influenced by
a growing stakeholder ecosystem.
The decision to prescribe a drug is no
longer solely a physicians. Health
care authorities, such as Germanys
Federal Joint Committee or G-BA,
are playing a greater role. Health
care institutes, such as the United
Kingdoms National Institute for
Health and Clinical Excellence (NICE),
and Germanys Institute for Quality
and Efficiency in Health Care
(IQWiG), are influential, too. And
payers are not shy about weighing
in cost effects. Cumulatively, health
care authorities, institutes and
payers have become key market
influencers by increasing their role
in formerly physician-led health care
Current challenges
5
decisions. What is more, payers,
hospital chains and purchasing
alliancesincluding pharmacies,
wholesalers and physician networks
have emerged and grow in influence.
Second, as the degree of physicians
influence wanes as shown in figure
1 , patients as pharma end
customers are increasingly influenced
by pharmacists, personal efforts to
understand their conditions, and
health funds that advocate
integrated health care solutions. This
is significant because it means that
current and future customer
behaviors will alter significantly.
Here is why:
Physicians are often the last touch
point for customers. Although the
physicians role in prescribing drugs
is diminishing because of restrictions
and guidelines, physicians remain
important for pharma companies
because they will still be a main
gatekeeper in prescription decision-
Figure 1. Customer relevance over time in the German pharmaceutical market according to Accenture analysis
Specialists
Pharmacies
Hospitals
General
Practitioners
Pharmacy
Chains
Health funds
Patients
1 2 3 4 5 6 7
Todays Importance
1 2 3 4 5 6 7
Future Importance 2010
1 = Most important, 6 = Least important
making. That is why it is even more
important for pharma companies to
acknowledge that many physicians
reject the one-size-fits-all
marketing and sales approach.
Pharmacy chains are gaining more
importance as decision makers,
increasing price pressures on pharma
companies. For a range of drugs,
pharmacists have begun to take the
role of advisor with patients.
Patients are becoming a more
important customer group. Because
of co-payment and increased
information access, patients are
seeking more information about
drugs, understanding more about
their diseases and influencing
treatment approaches, taking a more
active role in health care decisions
overall.
Health funds are gaining influence.
Especially in the context of direct
contractsmainly in the generics
segmentpharmaceutical companies
need to establish professional
functions to manage their
relationships with health funds.
Health funds will also become more
important to pharma companies via
joint pharma-health fund
collaborations that emphasize
integrated health care solutions.
The implications of challenging
pharma market changes and shifts
in the customer landscape revolve
around the fact that pharma
organizations will need to develop
customer-centric business models
so that they can deliver a continuous
stream of profitable growth.
6
In practice, becoming customer-
centric represents a tough balancing
act. Companies can increase
revenues by better satisfying
customer needs. There is opportunity
to personalize the customer
experience and meet different needs
and preferences. Sales force
effectiveness needs to be improved
and new products and services that
generate real customer value need to
be developed. On the other hand,
companies can save costs to improve
the bottom line. This implies that
sales force costs need to be reduced,
lower-cost channels explored, and
overall structural efficiencies
leveraged.
A customer-centric approach can
ease the tension between growing
revenues and employing cost-cutting
measures. Customer-centric
organizations make customer
relationships one of the major
dimensions for driving business
performance, along with shareholder
value, employee satisfaction and
corporate stewardship. Customer-
centric businesses harness corporate
resourcesincluding R&D, sales and
support functions that address
changing needs of target customer
segmentsto bring to market
relevant, unique and differentiated
products and services adapted
specifically for each customer group
and segment.
Fortunately, the concept of customer
centricity has already been
established in many other industries,
such as retail, consumer goods and
telecommunications (see level of
customer centricity sophistication in
figure 2). For more than a decade,
these industries have applied
customer-centric operating models,
strategies and offerings. Ten to 15
years ago, for example, global
consumer goods companies like
Unilever or Procter & Gamble (P&G)
changed their operating models to
strengthen customer focus. Retail
giants like Tesco and Metro designed
successful electronic loyalty
programs more than a decade ago.
Compared to these industries, the
pharma industry is still a beginner.
With an orientation traditionally
geared around scientific discovery as
well as R&D, pharma companies are
still focusing on product innovation
and are only slowly evolving a
stronger customer orientation. By
observing the pioneering customer-
centric approaches of retail or
consumer goods industries, pharma
companies can, as appropriate,
leverage best practices.
What pharma companies can learn from
other industries
7
multidimensional
Behavioral
Needs-based
Predictive (churn)
modeling
Figure 2. Level of customer centricity sophistication by industry.
Industry Level of business focus Level of advanced
customer segmentation
Level of innovative
channel mix
Customer Centricity
lifecycle maturity
Retail
Product Customer
multidimensional
Behavioral
Needs-based
Customer experience
analytics
Emerging
Multichannel Mgmt.
customer service with
high potential
Medium
multidimensional
Behavioral
Needs-based
Customer lifetime
value
Predictive (churn)
modeling
Customer value
Customer potential
Geographical
Advanced
Advanced
Emerging
Advanced
Multichannel Mgmt.
customer service
Advanced
Multichannel Mgmt.
customer service
with high (e-)inter-
active potential
Sales Force as
primary channel
First Multichannel
Mgmt. approaches
Telecommunication
Consumer Goods
Pharma
Product Customer
Product Customer
Product Customer
The following two examples of P&G
and Tesco illustrate how pharma
companies can adopt and adapt
customer-centric strategies from
other industries.
Customer-centric business
operating models and cooperation
at P&G
At the close of the 1980s, P&G was
organized into various internal
product divisions, each with a sales
manager. The sales manager
organized customer calls
independently, fracturing the
company identity because more than
one division would call into the same
account for different products.
Furthermore, sales managers pushed
products into the market irrespective
of customer need. For a time, P&G
was regarded as a complex and less
flexible organization, focused on
making sales that resulted in low
customer satisfaction, albeit strong
profit margins.
When P&G realized this, they
collaborated with Wal-Mart, a major
customer, to direct their product-
centric operating model toward a
more customer-centric model (see
figure 3). The companies exchanged
customer information, combining
retail information from Wal-Mart
with consumer and product
information from P&G. P&G and
Wal-Mart developed a joint account
team and a joint information system
to share customer preferences and
demand information that led to
meeting customer needs and driving
costs down. This approach resulted in
profitability increases and a much
better understanding of customer
needs. Today other companies in
different industries adopt this
innovative idea.
Many pharma companies still
operate on a product-centric model,
with an emphasis on brands, not
customers. Stronger customer
relationships and improved
information exchange would lead
organizations to better understand
customer needs and behaviors.
Understanding customer needs,
in turn, would lead to a more
customer-centric organization.
The improved relationship between
P&G and Wal-Mart demonstrates
this principle.
Understanding customer needs helps
organizations differentiate from
competitors. In the pharma industry,
companies should take a systematic
approach to gather customer needs
related information on physicians,
pharmacists and other customer
segments. By providing customers
with customer-relevant datasuch
as clinical trials results, non
interventional studies and specific
treatment informationpharma
organizations can foster a genuine
exchange. By moving to a customer-
centric operating model that
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increases customer interaction,
pharma companies would better
understand how to tailor offers that
serve unmet needs. They would also
learn to develop new sales and
channel marketing approaches.
Customer segmentation and
electronic loyalty
Tesco, one of the largest grocery
chains in the world, conducted a
multidimensional customer-based
segmentation analysis so it could
design a loyalty program that
produces tailored, relevant and
timely communication based on
customer-segmentation preferences.
Tescos customer segmentation
combines behaviors, needs, interests
and demographic data with
traditional measures such as sales
potential. Tesco places customers
into cost-conscious, mid-market
and up-scale segments, which are
then further parsed into sub
segments such as health conscious,
convenience or family oriented.
They detail the sub segments using
social-demographic data including
age, gender and location. Based on
this sophisticated segmentation plan
Tesco then creates communications
tailored to each segment profile.
Tescos sales have increased by 52
percent in a short time frame a
growth rate well above the industry
norm of 4 percent compound annual
growth rate (CAGR) within the past
10 years.
In the pharma industry, physicians
remain the main customer segment,
and approximately two-thirds of a
pharma brands budget is spent on
physicians. Unfortunately, many
pharmaceutical companies classify
physicians on only one or two
dimensions, usually as prescribers
with high, medium or low sales
potential.
This formula limits opportunities to
provide tailored sales and marketing
activities because it just considers
results without taking the time to
probe for underlying behavior.
Pharma companies have a
tremendous opportunity to adapt
proven multidimensional approaches
from retail and consumer goods
industries, which include questions
of brand loyalty, responsiveness,
levels of personal satisfaction or
fulfillment, price consciousness, as
well as communication channel
preferences, including physicians
level of interest in topics related to
customer values, safety and science.
Because multidimensional
segmentation identifies the
appropriate segments for a given
scenario, it leads to better segment
characterizationsmaking it possible
for pharma companies to prioritize
customer segments according to
brand or portfolio characteristics and
to tailor customer experience. Over
time, other targets, including
patients and health funds, are
becoming more important and
should, as a result, be taken into
Manufacturer Retailer Distributor Supplier
Timely, accurate information flow
Smooth, continuous flow of product matched to consumption
Product provider Retail company
Figure 3. Integrated customer-centric value chain model.
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account when defining a customer-
segmentation approach. By
evaluating the most valuable
customers, marketing and sales
spending can be allocated more
efficiently and sales force
effectiveness can be increased as
activities are tailored to meet the
needs of finely detailed customer
segments.
The introduction of electronic loyalty
cards at Tesco and other retailers like
Germanys Metro presents another
interesting tactic through which the
pharma industry might create
stronger customer relationships.
Because of strict governmental
regulations and the country-specific
reimbursement policy, electronic
loyalty cards in Germany can be
introduced for over-the-counter
products only. Loyalty programs,
however, can play a more important
role in emerging markets, such as
Brazil, Mexico and Russia, which
have few reimbursement plans and
difficult-to-afford medicines. In
countries like the United States
where direct-to-consumer
advertising is permitted, patient
loyalty cards might offer benefits
such as discounts or comprehensive
value-added services targeted to
positively influence patient behavior,
drive compliance and allow for
positive health outcomes.
Leading global pharma players have
already implemented successful
loyalty card programs in selected
markets, such as Brazil and the
United States. In the US, adherence
programs are combined with loyalty
card programs to drive patients
compliance, brand value and market
share. Adherence programs represent
a huge growth opportunity.
Accenture research has shown that a
3 percent increase in adherence can
lead to $1.0 billion in revenue. To
design effective and successful
adherence programs as part of a
customer-centric operating model,
pharma companies need to identify
barriers to compliance, including
cost, side-effects, forgetfulness,
inconvenience and lack of education,
and then develop different strategies
for overcoming these barriers.
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Customer-centric organizations
make customers the center of
strategic decision making. They
have an operating model that
places customers at the center of
operations. Their business processes
align to customer needs and are
flexible when changes are necessary
(see figure 4). They have a clear
vision, keeping the customer at the
center of their talent management
and can leverage the information
technology (IT) infrastructure to
improve customer relationships in
all segments.
From a pharma industry perspective,
customer-centric organizations
deliver more than just a medicine or
an ingredient to a sick patient, but
rather a holistic solution and a yet
unsolved medical need. By offering
unique, relevant health solutions and
services, customer-centric
pharmaceutical organizations
capitalize on customer satisfaction
for the purpose of creating beneficial
sustainable relationships that
recognize the potential for mutual
benefitand that endure in times
of crisis.
Some pharma companies have
recognized the urgency to act. One
multinational pioneering pharma
company has already turned its
operating model toward a customer-
centric model. Other companies are
implementing smaller pilot initiatives
on their journey to becoming more
customer-focused. They have started
to improve the customer experience
by providing or extending Web-based
services, educational programs,
practice and support services, and
patient management and support.
Leading pharma companies have
started to implement advanced
electronic marketing capabilities to
better serve their different customer
groups as part of their customer
centricity initiatives. For example,
one of the top 10 global pharma
players according to revenues has
implemented a series of electronic
offerings to better target physicians.
These electronic offerings include
e-detailing, e-congresses, live
e-seminars, e-sampling, physician-
centered Web sites and online key
opinion leader management.
Customer centricity and new business
opportunities
11
Current Pharma Commercial Model
Business
Unit I
Brand X
Business
Unit II
Business
Unit III
Brand Y Brand Z
Sales Forces ... ...
Marketing
Planning &
Execution
Sales
Enablement
Comm.
Analytics
Shared Services
Future Customer-Centric Pharma Commercial Model
Business
Unit I
Physician
Business
Unit II
Business
Unit III
Patient Payer
Sales
Force/KAM
Sales
Force/KAM
Sales
Force/KAM
Business
Unit IV
Business
Unit V
Objectives
Increase
customer
satisfaction,
loyalty and
portfolio
revenues
Reduce
customer
costs to
serve
Pharmacist Hospital
Shared Services
Marketing and Sales Planning
Marketing Services (e.g. Media, Internet)
Sales Services (e.g. Call Center)
Commercial Analytics
Medical Affairs
Sales
Force/KAM
Sales
Force/KAM
Figure 4. Shift from current pharma commercial model to future customer-centric model.
Where customer centricity begins
Most pharma organizations today are
too far removed from the idea of
putting customers first. Despite the
dramatic industry changes, they are
more focused on products than on
customers. Rather than identifying
and serving a distinct need with a
relevant product and service that
targeted customers appreciate,
pharma companies still emphasize
a one-size-fits-all strategy whether
or not the customer or regulatory
authority is interested. Attempts by
the industry to adopt a differentiated
targeting approach have often been
exclusively driven by call frequencies
per customer group. Other
differentiating factors are not
considered in this context.
For customer centricity to take hold,
the pharma industry requires a
radical organizational shift from
product and brand focus to customer
focus. This implies not only change
to the mindset of leaders and
employees, but also extends to
changes in the operating model and
associated IT processes. It demands
transformation of the following three
major dimensions that drive
customer centricity and loyalty:
Knowing the customer
Successful pharma organizations that
have walked the path of customer
centricity know who customers are,
what customers really think, believe
and need, and how these psycho-
social factors vary among customer
groups. They strike an outside-in
perspective. They glean the facts
they need for success via customer
segmentation and deep analysis, and
they are able to translate these
insights into profitable decisions
about product, pricing, promotion
and place. They expand the
traditional focus on customer
relationship management to
customer experience management.
These pharmaceutical companies
have understood that the physician
is no longer the main source of
profit. Rather, customers, such as
patients, government agencies and
health care funders, gain increasing
influence on sales. They carefully
spend their resources based on the
value each customer segment
actually has, or is likely to have,
in the future.
Reaching the customer
Customer-centric pharma
organizations know their customers
communication preferences. They
know that targeting each customer
via the same method, for example,
through sales representatives, is
not the only effective form of
communication. They have a clear
understanding that even among
physicians there are segments with
different needs in the way they are
motivated to treat patients as well
as in the way they want to be
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informed and engaged. These
companies innovate and experiment
with their channel strategies. They
reach customers through channels
that customers prefer, rather than
those the company feels comfortable
to capitalize on.
These customer-centric organizations
increasingly adapt to channels that
customers can control. They use on-
demand methods that deliver value
from the affected customer
segments perspective. They know
that different media can resonate
with different types of customers
and take the opportunity to design
custom interaction strategies for
each customer segment. In this way,
they reach the right customers at the
right time through the best method,
engaging in a reciprocal information
exchange. These companies maximize
marketing return on investment by
increasing offering relevance via
solution-centric selling and effective
partnering.
Delivering the customer experience
Successful customer-centric
pharmaceutical organizations see
their business through the eyes of
their customers. They deliver an end-
to-end experience that reflects a
holistic, multidimensional customer
view rather than reflecting internal
structures and organizational
complexity. These companies know
how to integrate the different
channels they use to create brand
perception and customer
relationships. These companies keep
their sales representatives informed
about any calls with the call center,
what questions the customer asked
and the answers delivered. Sales reps
are told which articles, in which
journals, are relevant to each topic
or knows whom to contact in order
to fulfill information requests. These
companies deliver consistent and
highly relevant customer experiences,
speak with one voice to the customer
and create trust and loyalty.
What customer centricity requires
Developing a customer-centric
organization requires a clear, long-
term, strategic customer visiona
vision that aligns the operating
model and the supporting systems
with customers, not products (see
figure 5).
A long-term strategic customer
centricity vision provides:
A clear picture of what customer
centricity in the long-term looks
like.
A transparent and clear agenda for
change.
Leadership committed to driving
the transformation from top-down.
Strong and active leadership in the
implementation of change.
An organization empowered to
change.
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Customer Centric Continuum
Product
Centric
Analysis
0
Operating
Model
Marketing
Segmentation
1
Customer
Management
2
Customer
Segment
Advisors
3
Customer
Segment
Owners
4
Customer
Centric P&L
5
Financial Process
structured to
report segment
results.
Organization structured to ensure accountability for specific
customer segment performance (e.g., advisor, owner).
In-store tactics & loyalty programs to produce desired customer behaviors.
Customer segments established and used for basic marketing initiatives such as direct mail.
Tactics driven by market trends, market share, product features, price & range architecture. Vendors tend to be a primary source of
market and competitive information.
Product Centric Customer Centric
Figure 5. Evolving the operating model into customer centricity.
The customer-centric organization
should granularly address business
processes, capabilities, roles and
responsibilities and sales
management in a number of ways.
Business processes
To align business processes with
customer-centric business models,
organizations should leverage
relevant and integrated target
customer-segment experiences.
Organizations need to use integrated
analytics to drive data mining and
strategic customer segmentation,
target customers with products and
services based on past interactions,
behaviors and preferences, optimize
coordination of development and
growth of various channels across
customers, optimize product/service
portfolios delivered to the customer,
and finally, manage multichannel
business processes.
Capabilities
To develop a customer-centric
business approach, organizations
must develop capabilities that help
them master complexity inherent to
customer centricity.
Organizations need to make portfolio
decisions based on sales potential
across customer groups, perform
integrated brand and customer
development planning (instead of
pure brand planning), plan
strategically for each channel across
customers, conduct cross-sector
planning across operating system
blueprints, and create business
roadmaps that enable channel and
brand integration.
Roles and responsibilities
To foster customer centricity,
organizations need to foster the
growth of open, committed people
and bolster organizational change
capabilities.
Organizations need to identify people
with the comprehensive analytical
skills to identify key
customers/influencers from within all
parts of the health care system,
foster the ability to focus business
efforts on key influencers and waive
unprofitable customers, remain
open-minded to creating new
channels, be willing to change the
current sales model to an integrated
key account model, and enable
channel and brand integration across
customer segments.
Sales management and dedicated
key account management
To change the sales culture so that it
can adapt to a customer-centric
business model, organizations need
to improve sales management to
better target the most important
customer groups.
Organizations need to dedicate key
customers and accounts to target the
14
most important customer groups,
understand and actively manage the
most important and profitable
customers to enhance existing
relationships and help sustain
growth and profitability, move from
homogenous one-size-fits-all selling
to a diversified, customer-centric
approach (especially for the most
profitable customer groups), and
implement a key account program
to facilitate specific interactions
with key customers, so that long-
term, trust-based relationships are
established.
Furthermore, organizations need to
harness key account programs to
deliver differentiated customer
services, adapted organizational
structures and defined targeting
techniques, ensure that the
alignment of resources and tasks
occurs via newly created roles and
responsibilities, make key account
managers responsible for planning,
negotiation, implementation and
analysis of customer activities, and
ensure that key account managers
provide leadership related to finance,
health economics, key opinion leader
management, marketing, medical
affairs, pricing and contract
management, and the sales function.
Benefits of customer centricity
Customer centricity allows pharma
companies to improve customer
satisfaction and loyalty, leading to
additional revenues and reduced
costs.
Customer centricity places a
premium on identifying and
understanding customers key
decision points on the way to
fulfilling a drug prescription. It
provides an opportunity to develop
and implement integrated service
packages for targeted customers and
to deliver more than just a brand
with a marketing message. Rather, it
delivers unique customer experiences
that make a difference to physicians
as well as to patients or other
relevant customer groups.
A customer-centric approach is
beneficial to pharma companies and
customers as it increases party
involvement, customer interaction
and brand intimacy. Developed and
implemented in accordance with
customer motivations, beliefs and
needs, customer centricity delivers
on brand promise, while promoting a
consistently differentiated experience
that enhances customer satisfaction
and loyalty.
Business factors
Segmentation
Customer, marketing and channel
return on investment analytics
Promotional response measurement
Customer experience monitoring
Technology factors
Business and IT governance to allow
integrated view on the customer
including an efficient customer
relationship management system
Data/information architecture to
support 360 degree view on the
customer
Cultural factors
Common language
Change management approach
and capability
Culture and innovation change
support
Structured program management
Legal and regulatory environment
to support change
Figure 6. Enabling factors that support the shift to customer centricity.
15
Increased product portfolio
revenues
Increased loyalty leads to demonstrable
improvement on top line revenues.
Loyal customers are more predictable
when it comes to regulatory decisions
and those being responsible for
prescription and or purchase of the
product intend to buy more, buy more
frequently and refer to other physicians
or patients to the company. Loyalty
further drives cross- or up-selling
potential.
Reduced costs to serve
Customer centricity allows a company
to identify their most valuable
customers and leverage resource
efficiency by focusing company efforts
on them. It offers the company the
opportunity for early entry to markets,
segments and new channels and
minimizes the risk of promotional
budget overspending. Being customer-
centric in the approach to pharma -
ceutical customers assures effective
and efficient execution of brand
strategy and more efficient meeting
customer needs.
Accenture High Performance
Business research shows that a
pharma companys ability to
transform to a customer-centric
model, delivering consistently
rewarding customer experiences has
significant impact on its ability to
create long-term customer loyalty,
thereby driving sustainable growth.
Figure 7. Loyalty leads to increased revenues and reduced costs.
16
As pharma companies confront new
economic realities, many find
organizing an effective response in
this highly complex, highly uncertain
environment challenging.
Accenture provides clients with the
Customer Centric Transformation
Approach, an integrated suite for
transforming a business from a
product-focused to a customer-
centric organization (see figure 8).
Accenture employs a customer-
centric transformation offering that
uses a structured five-step approach
to address the gap between a
companys current and desired
position.
Step 1a/1b Build robust
customer segments and profiles
A key starting point for transforming
a product-focused pharma company
into a customer-focused organization
is a well-prepared and innovative
customer-segmentation analysis.
Pharma companies typically consider
variables such as customer value and
sales potential as segmentation
criteria. To build actionable customer
segments and profiles, companies
also have to consider customer
behaviors, needs and preferences. For
physicians, these could include core
beliefs (for example, an interest in
high-scientific consultation versus
need for well-structured basic
product information), communication
preferences (for example, an interest
in close exchange with sales force
versus a preference for information
via electronic channels). Defining
robust customer segments, based
on more than just traditional
segmentation criteria, is a key
Accentures approach to customer-
centric transformation
2
1a
1b
or
Assess and
Leverage Existing
Segmentation
Segment
and Profile
the Customers Identify
Key Customer
Centric Factors
3
Operationalize
Customer Centric
Initiatives
4
Create Customer
Segment
Accoutability
5
Measure Impact
and Refine
Execution/
Customer
Insights
Ongoing Change Management
Figure 8. Accentures approach to customer-centric transformation.
17
success factor on the journey to
becoming a customer-centric
organization that achieves high
performance.
Step 2 Identify key customer-
centric factors
To prepare the right targeting
strategy and tactics for customer
segments, key customer-centric
factors need to be identified. These
factors provide intelligence when
building customer experience models
and include core tenets, elements
and the drivers that shape customer
treatment. Defining the customer
experience is a challenging task that
combines three core elements:
Customer needs. What degree of
interaction is desired? Which
product and information value is
expected?
Customer segments. What are the
core beliefs and attitudes of
customers?
Touch points. How would we
communicate or interact with
customers?
A successful customer experience
provides the right information or
service, at the right time, using the
most suitable channel. Customer
experiences at each interaction
affects overall company satisfaction,
leads to positive perception and
ultimately affects future behavior
and loyalty.
Step 3 Operationalize customer-
centric initiatives
Plan concrete measures by customer
segment using a customer experience
blueprint, consolidated with a
roadmap of recommendations to
create short- and long-term value
for each customer group. Individual
segment-specific business rules
define the coordinated
implementation of all planned
activities by customer group.
Multichannel management is a key
to customer-centric initiatives
because it provides messages
through integrated channels.
Multichannel management enables
sales and marketing to effectively
serve its customers (physicians,
pharmacies, patients) through the
most suitable channel, in a
coordinated way and in accordance
with individual preferences. The
biggest transformation effort in this
context is the creation and adoption
of new processes, as well as new
roles and responsibilities that
support customer centricity.
Step 4 Create customer segment
accountability
Create clear customer segment
responsibility and accountability.
Dedicate a sales and marketing team
to each customer segment. To
maximize the level of customer
centricity in pharma, each customer
should only have a single point of
18
contactin most cases, this would be
an individual sales representative.
The sales representative should be
able to represent the full product
portfolio with one voice to the
customer, supported by selected
product specialists. The objective
is to create a positive customer
experience: For physicians, this
means creating the perception that a
given pharma company is a reliable,
credible partner that delivers
unbiased information when needed.
Specific, high-value key accounts
require a dedicated sales team. To
ensure people know what they are
accountable for, define clear roles
and responsibilities and consider
human resources and talent
management. Designing teams
for clear customer segment
accountabilityand the ability
to deliver the best customer
experiencerequires specific skill
sets in the sales teams. Piecing
together the right team is one of
the biggest challenges because of
competition and how easy it is for
human resources to move from one
company to another.
Step 5 Measure impact and
refine execution/customer insights
Creating a customer-centric
organization is not a one-time
exercise. It is a continuous process
of re-shaping and refining processes,
information systems, roles and the
people who fulfill them. Financial
processes have to be adapted to
measuring performance by segment
rather by product level. Performance
management systems will require
alteration to order to reward
customer satisfaction rather than
pure sales. Companies can measure
impacts with the help of a scorecard
system that delivers valuable
information for continuous
improvementeven to the point
of altering segment definitions.
The objective is to create a positive
customer experience: For physicians,
this means creating the perception that
a given pharma company is a reliable,
credible partner that delivers unbiased
information when needed.
19
20
Transforming a product-focused
organization into a customer-centric
organization affects many areas of a
business including processes,
procedures, people and tools.
Successful transformation requires a
continuous change management
program including a communication
plan to build awareness and
understanding of forthcoming
process and organizational changes
across various stakeholder groups.
To successfully transform to a
customer-centric organization and
realize high performance, pharma
companies need to consider the
following five critical success
factors:
Gain leadership support and
commitment
The success of a transformation into
a customer-centric orientated
organization depends on the support
and commitment of the leadership,
from the board and the CEO down to
project champions in functional
areas. If the process fails to obtain
and maintain executive support that
cascades throughout, the
organization, employees do not feel
an authentic need for change and
resist. Across industries, processes
and operations are well established
over a long time. There is a natural
resistance to replacing old habits and
embracing new ideas and concepts,
which is why it is important for
leadership to act as a role model
that continuously promotes a clear
vision of a customer-centric
organization and communicates
exactly how the organization will
build that vision.
Present a business case
To become a customer-centric
organization, create a financial
business case including the metrics
by which you can measure success.
Screen initiatives to ensure they
align with the vision and financial
metrics. Strategies and tactics driven
by the transformation need to be
quantified on a regular basis. It is
important that the organizational
change relies on an analytical return
on investment focus and not
subjective impressions. This means
that all customer centricity
investments are directly linked to a
companys income statement. By
focusing on business outcomes and
not solely on capabilities,
organizations will have more success.
Customer centricity is not an end in
itself. It must link to measurable key
performance indicators and financial
metrics.
Customer-centric organizations and
high performancecritical success factors
21
Prioritize steps in transforming the
business model
Create a value-based, prioritized
implementation plan will ensure that
the most important areas are
addressed first, which means that
the basics need to be finalized before
more advanced strategies can follow.
A concrete and transparent
implementation plan will create
tangible value that staff can
recognize. Early wins are important
to establishing a course for long-
term success, providing motivation
and proof that the transformation is
necessary. For a pharmaceutical
company this means, for example,
that a customer-segmentation and
targeting approach are designed
prior to realigning sales and
marketing activities.
Create a new governance model
Customer centricity must link to
higher-level business strategies and
should not be viewed as a
standalone project. To be truly
customer-centric it is not sufficient
to transform single processes like
sales or marketing activities. Rather
companies need to make changes to
their overall governance model. An
integrated project implementation
should focus on all relevant
departments within an organization.
For instance, pharmaceutical
companies can implement a
customer-centric approach by
feeding back the experiences of the
sales force or the call center to
research and development to set a
higher priority on customer requests
in the development process.
Streamline customer touch-points
A customer-centric organization
streamlines all customer interactions
to create a consistently good
customer experience. Physicians,
pharmacists, patients or health care
authorities should receive the same
tailored messages across multiple
channels. Therefore, it is essential for
a customer-centric pharma company
to create an effective multichannel
management strategy in which the
selection of appropriate channels is
determined by customer needs and
preferences.
22
Accenture helps pharma
organizations to achieve high
performance through customer
centricity by enabling them to keep
pace with evolving market
conditions, reach the flexibility to
respond quickly to changing
customer expectations and execute
differentiated customer experiences.
Accenture offers proven expertise
and experience in pharma and health
care markets worldwide. Accenture
helps clients to define and
implement corporate and functional
strategies, in research and
development, business development,
and sales and marketing as well as
market evaluation and the building
of competitive intelligence analytics.
Furthermore, Accenture provides
deep pharma expertise and cross-
industry know-how, supported by a
global network of experts as well as
a global research team. Accenture
has a strong track record in
successfully supporting companies in
pharma and other industries in
conceptualizing and implementing
major business transformation
programs.
Accenture is a global management
consulting, technology services and
outsourcing company with proven
expertise in customer-centric
transformation programs. Accenture
supports various life sciences
companies in accelerating growth,
increasing profitability and achieving
greater operating efficiency.
Accenture has helped many clients to
define innovative approaches by
transferring and aligning best
practices and experiences from other
industries. Our research, insights,
global reach and delivery capabilities
help clients to identify growth
opportunities, make long-term
investment decisions and define
sustainable strategies.
Health and life sciences companies
can rely on Accenture professionals
and dedicated methodology to define
a long-term customer-centric
strategy that helps drive high
performance.
Why Accenture
23
Copyright 2009 Accenture
All rights reserved.
Accenture, its logo, and
High Performance Delivered
are trademarks of Accenture.
About Accenture
Accenture is a global management
consulting, technology services and
outsourcing company. Combining
unparalleled experience,
comprehensive capabilities across all
industries and business functions, and
extensive research on the worlds
most successful companies,
Accenture collaborates with clients to
help them become high-performance
businesses and governments. With
more than 177,000 people serving
clients in over 120 countries, the
company generated net revenues of
US$23.39 billion for the fiscal year
ended Aug. 31, 2008. Its home page
is www.accenture.com
For more information
To learn more about how Accenture
can assist your pharma organization
with achieving high performance
through customer centricity, please
contact:
Andrea Brckner
Partner, Health & Life Sciences
Telephone: +49 6173 94-67328
andrea.brueckner@accenture.com
Florian Schulz
Manager, Health & Life Sciences
Telephone: +49 89 93081-68830
florian.schulz@accenture.com
Eva Wiedenhft
Consultant, Health & Life Sciences
Telephone: +49 6173 94-67523
eva.wiedenhoeft@accenture.com