Market Research Vendor Management Excellence Report Summary


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Report Summary--Market Research Vendor Management Excellence: Evaluating the Use of Exclusive Vendor Partnerships. Contact me to view the full report.

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Market Research Vendor Management Excellence Report Summary

  1. 1. Market Research Vendor Management Excellence: Evaluating the Use of Exclusive Vendor Partnerships Best Practices, LLC REPORT SUMMARY
  2. 2. Table of ContentsPROJECT BACKGROUND Project Overview Benchmark Class Profile Key FindingsSTUDY FINDINGS Vendor Partnership Benchmarks Outsourcing Levels Number of Vendors Used Common Contracting Models Exclusive Vendor Partnerships Usage Patterns & Mapping Levels Contracted Study types Contracted Future Use Continued
  3. 3. Table of Contents, 2Evaluating Exclusive Vendor Partnerships Goals & Benefits Drawbacks ROI & MeasurementManaging Exclusive Vendor Partnerships Resources & Account Management Collaboration with Marketing Teams Penalty & Incentive Systems Training Employee EngagementPerspectives from Companies Not Contracting Exclusive VendorsAppendix: Insights from Executive InterviewsAbout Best Practices, LLC
  4. 4. Study Objective & Research MethodologyThis benchmarking research study examines vendor management strategies to help bio-pharma market research groups provide support and value that aligns with broaderorganizational goals and commercial objectives. In particular, this research explorestrends and efficiencies in the use of exclusive vendor partnerships. Research Objectives: Key Topic Areas Probed: • To uncover current field data on a series of key This benchmarking research, conducted vendor management benchmarks, including through a field survey instrument and a outsourcing levels, number of vendors used, series of interviews with selected and critical factors driving various vendor participants, delivers performance metrics, contracting models insights, and lessons learned on: • To gather innovative approaches and executive insights into the evolving role of the bio-pharma market research function from both •Vendor management models for primary a tactical and strategic perspective market research • To adapt lessons that will enable market •Vendor contracting strategies research leaders to plan and implement •Streamlining the market research function strategies for controlling costs, avoiding •Maintaining high levels of research quality common mistakes, and improving quality on •The benefits and drawbacks of exclusive primary market research through vendor vendor partnerships in the current management excellence economic and industry landscape BEST PRACTICES, 4 ® Copyright © Best Practices®, LLC LLC
  5. 5. Universe of Learning: Companies Participating in StudyResearch participants included 37 market research executives and managers from 26leading pharmaceutical, biotech and medical device companies. All study participantscontributed data through a field survey. Representatives from ten benchmark organizationsprovided additional insights through deep-dive interviews. Participating Companies: BEST PRACTICES, ® LLC
  6. 6. Most Participants Serve at Director Level or AboveResearch data and insights were contributed by a seasoned class of respondents, fromvice presidents to managers. The vast majority of respondents serve at the directorlevel or higher. Research Participant Job Titles Include: • Vice President, Oncology • Director, Marketing • Executive Director, Market Research • Director, Sourcing & Supply Management • Executive Director, Business Analysis • Director, Commercial Effectiveness • Senior Director, Market Research (4) • Associate Director, Market Research & • Director, Market Research (11) Analysis • Director, Marketing Research • Deputy Director, Market Intelligence • Director, Market Analytics • Senior Manager, Market Research • Director, Business Analysis • Manager, Market Insights • Director, Business Intelligence • Manager, Market Research (6) • Director, Managed Markets • Manager, Marketing Science BEST PRACTICES, 6 ® Copyright © Best Practices®, LLC LLC
  7. 7. SAMPLE: Key Findings and InsightsThe following key findings and insights emerged from this study. • Account management frequently occurs at the market research Director level: Exclusive Vendors are most often managed at the account level by a market research director, while a market research manager most often serves as a primary point of contact. EVs also tend to work remotely and only rarely ever interact directly with marketing or brand teams. • Companies not using Exclusive Vendors express several different reservations: Respondents cited a wide variety of rationale for not using an EV for market research, including: • The need to maintain competitive bidding on projects, particularly ones with large spends • The belief that EV contracts undermine vendor innovation • The view that no one vendor excels across multiple types of studies • The need for flexibility and the ability to change suppliers as needed • The difficulty in implementing an EV partnership model BEST PRACTICES, 7 ® Copyright © Best Practices®, LLC LLC
  8. 8. Vendors Most Often Hired on a “Project-by-Project” BasisMost benchmark organizations adhere primarily to one of two main vendor contractingmodels, wherein they hire external vendors either: 1) on a project-by-project basis or 2)from a list of preferred vendors. For the benchmark class on the whole, ExclusiveVendors conduct only a small percentage of a company’s market research. Q. What percentage of your primary market research projects are governed by the following vendor contracting models? 3% “Exclusive Vendor” Contracting Model 55% 42% “Project-by-Project” Contracting Model “Preferred Vendor” Contracting Model (n=23) BEST PRACTICES, 8 ® Copyright © Best Practices®, LLC LLC
  9. 9. Drawbacks Include Lack of Innovation, Resource EfficienciesDespite gains in cost efficiency, the Exclusive Vendor contracting model does not appearto be a panacea for all market research challenges. Half of respondents deemed “lack ofinnovation” and “lack of FTE efficiencies” to be among the difficulties resulting fromusing an Exclusive Vendor. Q. Which of the following problems, if any, did your company experience as a result of moving to an Exclusive Vendor for market research? (Check all that apply) Lack of vendor innovation 50% Lack of resource/FTE efficiencies 50% Inability of vendor to deal with different aspects of the business 33% Voices from the Field: Minimal/No cost savings 17% “Weve vetted them [EVs]. Through historical experience we know the people, we know the quality of the work. We know they are not Implementation/Operational ridiculously expensive and even if they are we hope that we are difficulties 17% contracting to get slightly better pricing from them. And so the rest of the [EV] process is just quality control. You know the level of experience and amongst the brand teams or Vendor complacency 17% whoever is the end user…they know too or at least have heard of the vendor repeatedly and that gives a level of confidence…But we focus on impact, rather than a hard ROI measure. The question we Inability of vendor to adequately ask is: ‘Is the market research work moving the needle?’ Is it support internal clients 0% actionable and insightful or will it just sit on the shelf.’” -Director, Insights & Innovation (n=6) BEST PRACTICES, 9 ® Copyright © Best Practices®, LLC LLC
  10. 10. Training Approaches are Geared toward the PragmaticSince Exclusive Vendors are frequently contracted to perform what some participants called“lower level” market research activities, it is not surprising that their training tends to be morepragmatic than strategic in nature. As a result, vendors are often trained remotely, with moreemphasis on proficiency with internal processes (83%) than on areas like brand strategy ortherapeutic area knowledge (33%). Q. What types of training does your company employ when onboarding an Exclusive Vendor? (Check all the approaches your company uses) Training Areas: Overall Company Orientation: Company and business profile: 0% On-site company orientation: 33% Internal Market Research process orientation: 50% Therapeutic area: 33% Virtual company orientation: (phone-based, technology-based, Brand strategy: 33% downloads) 67% Required proficiency with internal processes based on company- vendor relationship: (e.g., Purchase (n=6) Order generation) 83% Compliance (e.g., adverse events) 33% Voices from the Field: “When youve got a vendor coming on board therere certain protocols to know, from purchase orders to contracting to the invoicing process. So all that kind of training for the vendor is handled by a supplier management group to a certain extent. We supplement that by reinforcing and helping communicate. And then therere very specific protocols in terms of how we need to conduct research with formal training and refresher courses for the vendors.” -Manager, Market Research BEST PRACTICES, 10 ® Copyright © Best Practices®, LLC LLC
  11. 11. Respondents Predict Sustained, Expanded Use of EVsMost respondents anticipate a similar or even greater degree of Exclusive Vendor use in the nextfew years. Half of participants predict the same level of use in the next 12 – 36 months, while 33%foresee expanded usage in the future, where the pressure to reduce costs (in this case viaconsolidated contracting) figures to remain a chief concern for pharma market research groups. Q. How do you anticipate your company’s use of Exclusive Vendors for market research changing in the next 12 - 36 months? (Choose one) Expanded use of EVs for primary market research: 33% Same use as now: 50% Decreased use of EVs in favor of preferred vendor use: 17% Decreased use of EVs in favor of project-by-project vendor use: 0% (n=6) BEST PRACTICES, 11 ® Copyright © Best Practices®, LLC LLC
  12. 12. About Best Practices, LLCBest Practices, LLC is a research and consulting firm that conducts work based on thesimple yet profound principle that organizations can chart a course to superior economicperformance by studying the best business practices, operating tactics, and winningstrategies of world-class companies. Best Practices, LLC 6350 Quadrangle Drive, Suite 200 Chapel Hill, NC 27517 BEST PRACTICES, 12 ® Copyright © Best Practices®, LLC LLC