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Communicating VS Creating Value

Sales forces have justified their existence by communicating the value of their products and services. If a sales rep communicated product/service information and functionality to customers, the conventional thinking dee

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

med those actions as value creation in the selling process, because the customer was educated and learned how they could benefit by using a particular solution or service. The problem with this feature approach of communicating value is caused by the decline i

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

differentiation between products and services. With prevalent commodification in many industries (let me pick in particular on the building automation industry), the communicated benefits matter much less to customers. Value migrates from the solution to the

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

rice and a competitive procurement process.

So, sales forces must go beyond communicating the value of features a company or solution provides, and finding ways to create new value by thinking outside the box. To create value companies need to find ways to in

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

rease the ability to deliver “well differentiated benefits”. The problem is that a great deal of value propositions presented are canned, and unique benefits that translate into great value are uncommon. To this end, it is not enough that sales leadership comm

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

t themselves to a value creation agenda. They must know what it is that they are committed to - that is, what they must do. These obligations cannot be delegated, and action is required. Some ideas on how to work smart and establish a true value creation agend

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

include:

Target and engage customers early in the sales cycle to be able to influence the outcome, and not be reactive to opportunities at the 11th hour.

Train sales force on problem solving skills and proper selling approach to diagnose proble

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

s and needs well.

Institute account management disciplines for high potential and high penetration customers.

Find ways to reduce cost though Six Sigma initiatives that include the entire value chain, and not just the supply chain.

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

>Implement “Lean Enterprise” initiatives to further reduce costs and translate those saving into competitive advantage, or new sources of gross margin.

Web enable progress, and value reports to communicate the implementation of solutions/services.

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

Invest time and resources on face-time spent with customers to build better bonds.

Apply Gaps Model of Quality to services marketing initiatives to further differentiate services.

Train leadership on common and special cause variatio

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

to gain knowledge on value creation and the removal of high performance barriers.

Matching Strategy to Customers

Having a proper model for customer segmentation vis-?-vis value creation is essential, so that resource allocation is not an impedim

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

ent to selling efforts. Huthwaite makes a compelling case for how value migrates depending on the customer. So, who are transactional, consultative, and enterprise customers? That is the known unknown that even well trained and talented sales forces and manage

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

s have to figure out. How many times have you seen a heavy investment in selling effort turn out to be a losing proposition? This can be the result of misplaced attention on trying to persuade a customer with very clear ideas on a transaction, where the value

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

s low cost and no more. Time must be taken to understand how the customer defines value, and how to generate new insights by diagnosing problems and needs. The answer at times is to walk away by recognizing that you can not be everything to all customers, and

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

sing limited time and company resources to work on higher probability projects.

Interestingly, a failure mode of sales organizations is not recognizing that different approaches to selling are needed for different customers. The research by Huthwaite points o

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

t that when there is a value perception misfit no amount of selling skill, clever strategy, or well-crafted value proposition can bridge the gap between what a customer wants and what a supplier has to offer. In today’s environment customers demand more value

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

han ever, so it’s imperative that a sales force must align its values with those of the customer. Sales forces must learn to further segment customers according to the way they perceive and define value.

Traditionally sales forces have survived well by dividi

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

g customers by geography, size, vertical market, or specific products and services. However, as the world of sales continues to evolve the advantages of classifying sales efforts under the headings of transactional, consultative, and enterprise is not an optio

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

anymore if you want to win more sales. A sales force that creates new value by addressing accurately how a customer measures value, or brings a new consultative element of knowledge that can help a customer improve their business metrics will be in a better p

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

sition to win against a less sophisticated competitor. Unless the approach to creating value corresponds with the needs and value perception of customers, selling efforts will continue to languish in sales organizations lacking leadership to get with the times

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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