30/05/20131THE CHANGING SALES PARADIGM IN THEHEALTHCARE SECTORPROF DR DEVA RANGARAJANPROF DR BRECHT CARDOEN
30/05/20132© Vlerick Business School3“THE WINNERS WILL BE THOSE WHODELIVER SOLUTIONSFROM THE USERS’ POINT OF VIEW.”Jack We...
30/05/201331THE CHANGING ENVIRONMENT© Vlerick Business SchoolTHE CHANGING ENVIRONMENT: UNIVERSALTRENDS Aging populations ...
30/05/20134© Vlerick Business SchoolEVOLUTIONS - HOSPITALS (FLANDERS,BELGIUM) “We are focused on delivering an excellentc...
30/05/20135© Vlerick Business SchoolQUICK 10 MINUTE EXERCISEIF YOU REPRESENT ASUPPLIER , THIS IS FOR YOU To what extent a...
30/05/20136© Vlerick Business SchoolTRENDS IN STRATEGIC PROCUREMENT1. Reduce the “black-box” effect of solution selling11S...
30/05/20137© Vlerick Business SchoolTRENDS IN STRATEGIC PROCUREMENT3. Strategic Transaction Management13Source: Rethinking...
30/05/20138© Vlerick Business SchoolCLASSIFICATION OF TRANSACTION COSTS:SUBJECTIVE FACTORS15Internal to Company External t...
30/05/20139© Vlerick Business SchoolTRENDS IN STRATEGIC PROCUREMENT5. Optimization17Source: Rethinking Procurement in the ...
30/05/201310© Vlerick Business SchoolQUICK 5 MINUTE EXERCISEIF YOU REPRESENT ASUPPLIER , THIS IS FOR YOU To what extent a...
30/05/201311© Vlerick Business SchoolCHALLENGES FACING THE SALES EXECUTIVE Six things keeping sales executives up at nigh...
30/05/201312© Vlerick Business SchoolINSIGHTS: EXTERNAL ENVIRONMENT Six things keeping sales executives up at night:3. Un...
30/05/201313© Vlerick Business SchoolINSIGHTS: EXTERNAL ENVIRONMENT Six things keeping sales executives up at night:5. Th...
30/05/201314© Vlerick Business SchoolQUICK 15 MINUTE EXERCISEIF YOU REPRESENT ASUPPLIER , THIS IS FOR YOU How do you thin...
30/05/2013154FINDINGS FROM A RESEARCH STUDY WITHDELOITTE© Vlerick Business SchoolWE LOOKED AT RELATIONSHIPS30sales procure...
30/05/201316© Vlerick Business School32%active in procurement54respondentsBROAD SET OF RESPONSES3168%active in sales113res...
30/05/201317© Vlerick Business SchoolOVERALL FINDINGS33sales procurementOverall understanding,perceptions & frustrationsIn...
30/05/2013185SELLING IN THE FUTURE© Vlerick Business SchoolTHE SELLING WORLDSource: Zoltners et al., Building a winning sa...
30/05/201319© Vlerick Business SchoolIMPLICATIONS: SALES SYSTEM37CompanyresultsSales forcestructure androlesCustomerresult...
30/05/201320© Vlerick Business SchoolSTRATEGIC SELLING: A JOURNEY1. Segment customers based on needs2. For every segment, ...
30/05/201321© Vlerick Business SchoolSTRATEGIC SELLING: A JOURNEY1. Segment customers based on needs2. For every segment, ...
30/05/201322© Vlerick Business SchoolVALUE PROPOSITION TEMPLATE43RATE THE PERFORMANCE on a scale of 1 (very bad) to 5 (ver...
30/05/2013236CONCLUSION© Vlerick Business SchoolIMPLEMENTATION VS. DIAGNOSISSource: « Sales Force Effectiveness : A Framew...
30/05/201324© Vlerick Business SchoolSALES FORCE EFFECTIVENESS DRIVERS47Shapers• Recruiting• Training• Coaching• Culture f...
30/05/201325THANK YOU!EMAIL: DEVA.RANGARAJAN@VLERICK.COMLINKED IN: BE.LINKEDIN.COM/IN/DEVARANGARAJANWEB: HTTP://SEC.VLERIC...
30/05/201326© Vlerick Business SchoolOPEN ENROLMENT PROGRAMMESEXECUTIVE EDUCATION PROGRAMMES FOR EXPERIENCED PROFESSIONALS...
Upcoming SlideShare
Loading in …5
×

Changing sales paradigm in healthcare deva rangarajan brecht cardoen

558 views

Published on

Published in: Business, Education
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
558
On SlideShare
0
From Embeds
0
Number of Embeds
37
Actions
Shares
0
Downloads
26
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Changing sales paradigm in healthcare deva rangarajan brecht cardoen

  1. 1. 30/05/20131THE CHANGING SALES PARADIGM IN THEHEALTHCARE SECTORPROF DR DEVA RANGARAJANPROF DR BRECHT CARDOEN
  2. 2. 30/05/20132© Vlerick Business School3“THE WINNERS WILL BE THOSE WHODELIVER SOLUTIONSFROM THE USERS’ POINT OF VIEW.”Jack Welch© Vlerick Business SchoolAGENDA1. The Changing Environment2. Trends in Strategic Procurement3. Challenges Facing the Sales Executive4. Findings from a research study with Deloitte5. Selling in the future6. Conclusion4
  3. 3. 30/05/201331THE CHANGING ENVIRONMENT© Vlerick Business SchoolTHE CHANGING ENVIRONMENT: UNIVERSALTRENDS Aging populations putting stress on health caresystems Increased pressure on cutting costs in healthcare Need for increased transparency Increasing awareness by customers to focus ontheir core activities Era of Shared Alliances The increased clout of the purchasingdepartments/buying groups Rise of the intermediaries or the Value AddedResellers Multi-channel communication6
  4. 4. 30/05/20134© Vlerick Business SchoolEVOLUTIONS - HOSPITALS (FLANDERS,BELGIUM) “We are focused on delivering an excellentcustomer experience” “All non-core activities have been put on duediligence” “We are being asked by the local government towork together with local hospitals” “We decided to invest in elderly homes andquickly found out that we could have synergiesin purchasing along with our division thatmanaged hospitals”7© Vlerick Business SchoolEVOLUTIONS - HOSPITALS (FLANDERS,BELGIUM) “We plan to quadruple our purchasingdepartment and create a separate functionthat’s sole purpose is to scan the globe for thebest possible solution with the right value/priceto recommend to our medical council” “Never before has been such emphasis onbringing outside professionals to manage thehospital functioning”8
  5. 5. 30/05/20135© Vlerick Business SchoolQUICK 10 MINUTE EXERCISEIF YOU REPRESENT ASUPPLIER , THIS IS FOR YOU To what extent are theabove mentioned factorsbeing considered aschallenges for yourorganization? What are you doing totackle these challenges?IF YOU ARE A HEALTH CAREPROVIDER/INSTITUTION, THISIS FOR YOU In your opinion, to whatextent is yourorganization beingaffected by the factorsabove? What struggles do youface with these changingmarket dynamics?92TRENDS IN STRATEGIC PROCUREMENT
  6. 6. 30/05/20136© Vlerick Business SchoolTRENDS IN STRATEGIC PROCUREMENT1. Reduce the “black-box” effect of solution selling11Source: Rethinking Procurement in the Era of Globalization: Frank den Butter and Kees Linse, Sloan Management Review, 2008© Vlerick Business SchoolTRENDS IN STRATEGIC PROCUREMENT2. Increase internal visibility within the organization12Source: Rethinking Procurement in the Era of Globalization: Frank den Butter and Kees Linse, Sloan Management Review, 2008
  7. 7. 30/05/20137© Vlerick Business SchoolTRENDS IN STRATEGIC PROCUREMENT3. Strategic Transaction Management13Source: Rethinking Procurement in the Era of Globalization: Frank den Butter and Kees Linse, Sloan Management Review, 2008© Vlerick Business SchoolCLASSIFICATION OF TRANSACTION COSTS:OBJECTIVE FACTORS14 Search/Information costs Acquisition costs Transport costs Quality assurance Installation andmaintenance costs Intellectual propertycosts Training DisposalInternal to Company External to Company Trade legislation Currency effects Import/Exportpermits/levies Labor costs and safetystandards Government rules andregulationSource: Rethinking Procurement in the Era of Globalization: Frank den Butter and Kees Linse, Sloan Management Review, 2008
  8. 8. 30/05/20138© Vlerick Business SchoolCLASSIFICATION OF TRANSACTION COSTS:SUBJECTIVE FACTORS15Internal to Company External to Company Sourcing decision onexisting jobs Effects on reputationand brand value Will staff support newsuppliers Will staff be able to dealwith the risks associatedwith new supply options Sustainabilityconsiderations in relationto local and globalenvironments Unions/political stability Customer views ondesirable sources/suppliers Labor costs and safetystandards EnvironmentSource: Rethinking Procurement in the Era of Globalization: Frank den Butter and Kees Linse, Sloan Management Review, 2008© Vlerick Business SchoolTRENDS IN STRATEGIC PROCUREMENT4. Accountability16Source: Rethinking Procurement in the Era of Globalization: Frank den Butter and Kees Linse, Sloan Management Review, 2008
  9. 9. 30/05/20139© Vlerick Business SchoolTRENDS IN STRATEGIC PROCUREMENT5. Optimization17Source: Rethinking Procurement in the Era of Globalization: Frank den Butter and Kees Linse, Sloan Management Review, 2008© Vlerick Business SchoolTRENDS IN STRATEGIC PROCUREMENT6. ComplianceSource: Rethinking Procurement in the Era of Globalization: Frank den Butter and Kees Linse, Sloan Management Review, 200818
  10. 10. 30/05/201310© Vlerick Business SchoolQUICK 5 MINUTE EXERCISEIF YOU REPRESENT ASUPPLIER , THIS IS FOR YOU To what extent are theabove mentioned factorsbeing considered aschallenges that yoursalespeople face? What are you doing totackle these challenges?IF YOU ARE A HEALTH CAREPROVIDER/INSTITUTION, THISIS FOR YOU In your opinion, to whatextent is yourorganization beingaffected by the factorsabove? What struggles do youface with these changingdynamics?193CHALLENGES FACING THE SALES EXECUTIVE
  11. 11. 30/05/201311© Vlerick Business SchoolCHALLENGES FACING THE SALES EXECUTIVE Six things keeping sales executives up at night:Source: Neil Rackham session at the Global Sales Science Institute meet- Milan 20111. The end of the “better mouse-trap” model21© Vlerick Business SchoolINSIGHTS: EXTERNAL ENVIRONMENT Six things keeping sales executives up at night:2. The death of F2F transactional selling22Source: Neil Rackham session at the Global Sales Science Institute meet- Milan 2011
  12. 12. 30/05/201312© Vlerick Business SchoolINSIGHTS: EXTERNAL ENVIRONMENT Six things keeping sales executives up at night:3. Unsustainable hybrid sales force23Source: Neil Rackham session at the Global Sales Science Institute meet- Milan 2011© Vlerick Business SchoolINSIGHTS: EXTERNAL ENVIRONMENT Six things keeping sales executives up at night:4. The ever extending sales cycle24Source: Neil Rackham session at the Global Sales Science Institute meet- Milan 2011
  13. 13. 30/05/201313© Vlerick Business SchoolINSIGHTS: EXTERNAL ENVIRONMENT Six things keeping sales executives up at night:5. The decline of RFP selling25Source: Neil Rackham session at the Global Sales Science Institute meet- Milan 2011© Vlerick Business SchoolINSIGHTS: EXTERNAL ENVIRONMENT Six things keeping sales executives up at night:6. Skyrocketing costs of chasing an opportunity26Source: Neil Rackham session at the Global Sales Science Institute meet- Milan 2011
  14. 14. 30/05/201314© Vlerick Business SchoolQUICK 15 MINUTE EXERCISEIF YOU REPRESENT ASUPPLIER , THIS IS FOR YOU How do you think theabove factors affect theeffectiveness andefficiency of your salesforce? What are you doing totackle these challenges?IF YOU ARE A HEALTH CAREPROVIDER/INSTITUTION, THISIS FOR YOU In your opinion, what arethe characteristics of asuccessful salesperson? What steps if any do youundertake to partner witha supplier?27© Vlerick Business School28SO CAN SALES AND PROCUREMENT GET ALONG?
  15. 15. 30/05/2013154FINDINGS FROM A RESEARCH STUDY WITHDELOITTE© Vlerick Business SchoolWE LOOKED AT RELATIONSHIPS30sales procurementOverall understanding,perceptions & frustrationsInternalchallengesInternalchallenges• Procurementmanagement• End-users such asengineering, R&D• ICT• Finance• …• Sales management• Marketing• Production andsupply chain• Finance• …
  16. 16. 30/05/201316© Vlerick Business School32%active in procurement54respondentsBROAD SET OF RESPONSES3168%active in sales113respondents© Vlerick Business SchoolSTILL LARGE DIFFERENCES IN PERCEPTION OFOVERALL RELATION3235%35%27%3%17%63%20%0%0% 10% 20% 30% 40% 50% 60% 70%CombativeCooperativePartnershipSuper CollaborationProcurement Sales
  17. 17. 30/05/201317© Vlerick Business SchoolOVERALL FINDINGS33sales procurementOverall understanding,perceptions & frustrationsInternalchallengesInternalchallenges• Value-adding partner• Demonstrating addedvalue• Convincing internalclient• Internal visibility• Too much focus onshort term• Internal alignmenton customer• Internalmisalignment,communication andcompany politicsActions Sales:• Deliver on promises• Efficient and proactivecommunicationFrustrations wrtProcurement:• Focus on cost and price• No access to otherstakeholdersActions Procurement:• Clear requirements• Communication• Open communication aboutselection• Sharing benefitsFrustrations wrt Sales:• Information sharing /communication• Not first contact• Opportunistic© Vlerick Business SchoolCONCLUSION FROM THE DELOITTE STUDYSALES CONCERNS Commoditization Ever extending sales cycletimes Managing the right Go-to-Market StrategiesPROCUREMENT CONCERNS Too much “black-boxselling Increasing accountability Managing transactioncosts34
  18. 18. 30/05/2013185SELLING IN THE FUTURE© Vlerick Business SchoolTHE SELLING WORLDSource: Zoltners et al., Building a winning sales team, 2009CompanyCompanystrategyMarketing andsales strategy Sales forceEnvironmentCustomersCompetitionResults• Customer• CompanyExternalforcesSales systemEffectiveness hunt• Companygoals andobjectives• Mergers andacquisitions• Productportfoliostrategy• Marketsegmentation• Valueproposition• Sales process• Go-to-marketstrategy• Marketsegmentation• Valueproposition• Sales process• Go-to-marketstrategy36
  19. 19. 30/05/201319© Vlerick Business SchoolIMPLICATIONS: SALES SYSTEM37CompanyresultsSales forcestructure androlesCustomerresultsActivitiesSalespeopleDefiners Shapers Exciters Enlighteners ControllersThe Sales force effectiveness driversThe Sales SystemForces outside the SalesSystemCompanyfactors- R&D- Operations- Finance- Marketing- Productoffering- Pricing- Services- Channel- StrategyEnvironment- Market growth- Competition- Consolidation- Government- Technology- RandomShocksSource: « Sales Force Effectiveness : A Framework for researchers and practitioners » by Andris Zoltners,Prabhakant Sinha and Sally Lorimer, Journal of Personal Selling and Sales Management, Spring 2008© Vlerick Business SchoolSALES FORCE EFFECTIVENESS DRIVERS38Shapers• Recruiting• Training• Coaching• Culture formation• CompensationEnlighteners• Customer Research• Targeting• Data and tools• Customer relationshipmanagement systemsExciters• Leadership• Compensation• Motivation programs• Meaningful workControllers• PerformanceManagement• Coordination systems• Vertical and horizontalcommunication• Compensation• Sales strategy• Customersegmentation• Customer offering• Sales process• Go-to-market strategy• Sales force design• Structure and roles• Size• Territory alignmentDefiners• Skills• Capabilities• Values• Customerinsight• Inspiration• Motivation• Expectations• Successmeasures• Roles• Territories• Selling ProcessImpactImpactThe Sales job The SalespersonSalesperson/ activitySource: « The Sales Force as an engine of organic growth » by Bernard Quancard and Andris Zoltners, Velocity 2009
  20. 20. 30/05/201320© Vlerick Business SchoolSTRATEGIC SELLING: A JOURNEY1. Segment customers based on needs2. For every segment, identify the customer’swork flow and identify pain points3. Identify the right combination of product(s)and services that will meet customerrequirements4. How well do we communicate the uniquenature of our value offerings?5. Factor transaction costs for the customer whenpricing your offer6. Follow up on after-sales relationship39© Vlerick Business SchoolCUSTOMER ACTIVITY CHAIN- GE MRI SCANNER1. Determiningrequirements andwhether having ascanner is justified.2. Financing the scanner3. Installing the scanner4. Testing, calibrating, andvalidating the scanner5. Maintaining andreplacing parts6. Replenishing materials(gases and imagingmedia)7. Training8. Preparing the patient fora scan9. Scanning the patient10.Interpreting the scan11.Updating the software12.Updating the hardware40GE HealthcareGE CapitalThird partyCustomer
  21. 21. 30/05/201321© Vlerick Business SchoolSTRATEGIC SELLING: A JOURNEY1. Segment customers based on needs2. For every segment, identify the customer’swork flow and identify pain points3. Identify the right combination of product(s)and services that will meet customerrequirements4. How well do we communicate the uniquenature of our value offerings?5. Factor transaction costs for the customer whenpricing your offer6. Follow up on after-sales relationship41© Vlerick Business SchoolVALUE PROPOSITION42To allstakeholdersTo specificcustomer segmentTo individualcustomerTopManagementMarket Managers,Product Managers,BLM,Sales ManagersKey Account Managers,Sales Executives,Account ExecutivesMissionstatementValuepropositionUSP forcustomer
  22. 22. 30/05/201322© Vlerick Business SchoolVALUE PROPOSITION TEMPLATE43RATE THE PERFORMANCE on a scale of 1 (very bad) to 5 (very good)NATURE OF BENEFITS Importance ABC Competitor 1 Competitor 2 Comp. adv.Product benefits1.2.3.4.Service benefits1.2.3.4.Brand benefits1.2.3.4.Total benefits 100© Vlerick Business SchoolSTRATEGIC SELLING: A JOURNEY1. Segment customers based on needs2. For every segment, identify the customer’swork flow and identify pain points3. Identify the right combination of product(s)and services that will meet customerrequirements4. How well do we communicate the uniquenature of our value offerings?5. Factor transaction costs for the customer whenpricing your offer6. Follow up on after-sales relationship44
  23. 23. 30/05/2013236CONCLUSION© Vlerick Business SchoolIMPLEMENTATION VS. DIAGNOSISSource: « Sales Force Effectiveness : A Framework for researchers and practitioners » by Andris Zoltners,Prabhakant Sinha and Sally Lorimer, Journal of Personal Selling and Sales Management, Spring 2008ImplementationDiagnosis46CompanyresultsSales forcestructure androlesCustomerresultsActivitiesSalespeopleDefiners Shapers Exciters Enlighteners ControllersThe Sales force effectiveness driversThe Sales SystemForces outside the SalesSystemCompanyfactors- R&D- Operations- Finance- Marketing- Productoffering- Pricing- Services- Channel- StrategyEnvironment- Market growth- Competition- Consolidation- Government- Technology- RandomShocks
  24. 24. 30/05/201324© Vlerick Business SchoolSALES FORCE EFFECTIVENESS DRIVERS47Shapers• Recruiting• Training• Coaching• Culture formation• CompensationEnlighteners• Customer Research• Targeting• Data and tools• Customer relationshipmanagement systemsExciters• Leadership• Compensation• Motivation programs• Meaningful workControllers• PerformanceManagement• Coordination systems• Vertical and horizontalcommunication• Compensation• Sales strategy• Customersegmentation• Customer offering• Sales process• Go-to-market strategy• Sales force design• Structure and roles• Size• Territory alignmentDefiners• Skills• Capabilities• Values• Customerinsight• Inspiration• Motivation• Expectations• Successmeasures• Roles• Territories• Selling ProcessImpactImpactThe Sales job The SalespersonSalesperson/ activitySource: « The Sales Force as an engine of organic growth » by Bernard Quancard and Andris Zoltners, Velocity 2009© Vlerick Business SchoolTOPICS TO PRIORITIZENeedsimmediateattention.Measure andcontinuousimprovement!There are otherprioritiesNice, but thereare biggerfish to fryImpact of thedrivers onperformanceCurrent performance on the driversLOW HIGHLOWHIGH48
  25. 25. 30/05/201325THANK YOU!EMAIL: DEVA.RANGARAJAN@VLERICK.COMLINKED IN: BE.LINKEDIN.COM/IN/DEVARANGARAJANWEB: HTTP://SEC.VLERICK.COM/LEARNING-CORNER© Vlerick Business SchoolCUSTOMISED MANAGEMENT PROGRAMMESUNLEASH THE TRUE POTENTIAL OF YOUR PEOPLE & YOUR ORGANISATIONCustomised Management Programmes are impactfullearning solutions meeting your specific business needs.The health & life sciences industry is one of VlerickBusiness School’s 4 strategic focus industries.2012 facts and figures: 121 customised programmes for 84 differentcompanies 4.529 participants in 14 countries worldwide above 80 % satisfaction ratesSome of our health & life sciences customers:Want to know more? Feel free to contact Anne Salenbien+32 9 210 98 72| +32 472 28 56 06 | anne.salenbien@vlerick.com
  26. 26. 30/05/201326© Vlerick Business SchoolOPEN ENROLMENT PROGRAMMESEXECUTIVE EDUCATION PROGRAMMES FOR EXPERIENCED PROFESSIONALSOur programmes address today’s most relevantbusiness issues. You can choose between short, butintensive courses and long-term programme formats.2012 facts and figures: 85 management programmes 3.859 participants 100% of our participants would recommend the‘Management for the Hospital Professional’programme to their colleagues!Some of our health & life sciences customers:Dr. Frank VerbeeckFoundation for PsychoGeriatryScheutbos Hospital"I have to thank Vlerick for theorganisation and quality of theManagement for the HospitalProfessional programme. I have takencourses with IMD and INSEAD in thepast, but what Vlerick offers is of anequivalent and even superior level.“Dr. Manu VerholenSint-Vincentiusziekenhuis DeinzeAnesthesist-Intensivist-Algologist"This high quality managementprogramme sparks my entrepreneurialambition to critically reflect upon the(current) hospital policy in all itsaspects. Creativity and reasoningbehavior are stimulated by a continuousinteraction between faculty and hospitalprofessional."Want to know more? Visit us online or contact us:www.vlerick.com/ziekenhuis | +32 9 210 92 46 | annelies.claeys@vlerick.com

×