The life sciences industry in India is undergoing a massive transformation. That shift is happening on many fronts, and is being driven by a wide range of scientific, technological, economic and social factors. In response, many organisations have had to overhaul their sales strategies overnight, as they try to keep pace with the dynamic realities of the market.
However, good sales strategies can only go so far. Companies need a well-trained and well-motivated sales organisation if their strategies are to be implemented effectively. Unfortunately sales teams in the Indian life sciences industry face multiple demands and challenges. This is because they now operate in a world of volatility, uncertainty, complexity and ambiguity (the so-called VUCA context).
One of the key challenges sales teams have had to face recently is the on-going COVID-19 pandemic. In terms of their sales and marketing, most Indian life sciences organisations have responded by altering their sales-performance parameters. They have done this in a way they hope will deliver their organisational objectives in the context of the new normal.
Figure 1 Organisations’ responses to COVID-19 challenges.
This begs a number of questions:
There is no one answer to these questions — or to the overall challenge they relate to. However, over the years, it has been observed that sales incentive plans (SIP) can be a highly effective strategy. SIPs can have considerable influence, as they reward individuals and teams for implementing a desired set of actions and for behaving in the desired way. Many organisations are therefore crafting SIPs designed to drive “desirable behaviours” amongst their sales teams and to reinforce their performance targets.
These parameters were included to ensure that:
These qualitative parameters include:
While most of these qualitative parameters are common, some are only now coming into general use (for example, doctor/call ratios, the adoption of virtual platforms).
The way in which certain sectors of the Indian life sciences industry have incorporated these parameters into their SIPs is discussed in more detail in the sections below.
Our survey suggests that eight out of 10 pharmaceutical organisations look at doctor/call ratios to evaluate the performance of their sales representatives.
The doctor/call ratio provides a target for the average number of healthcare professionals that a sales representative must visit in a day.
A doctor/call ratio is incorporated into many SIPs for a number of key reasons:
It should be noted that, while physical visits have long been the norm, in the post-pandemic world many organisations are actively evaluating online interactions, and considering whether to make them comparable with the in-clinic meetings.
Our survey suggests that about 19% of surveyed organisations are factoring in the adoption rate of digital content platforms into their Sales Incentive Plans.
Most of these companies have already integrated digital platforms into their work, to complement in-person meetings. This puts such companies ahead of the curve in terms of digitisation. It is clear that this emerging trend will become more of a norm in the next couple of years.
The adoption of virtual platforms/channels is incorporated into many SIPs for a number of key reasons:
Our survey suggests that about 33% of organisations incentivise sales teams based on the product knowledge and skills they have acquired.
Product knowledge and skills are incorporated into many SIPs for a number of key reasons:
**Our survey covering medical devices firms suggests that only one in five organisations include satisfaction scores in their sales incentive plans.
Incentivisation based on customer-satisfaction scores was not prevalent in the medical devices industry due to difficulty in tracking and measuring this criteria.
However, this situation may soon change:
The above survey also suggests that one in ten medtech organisations are incorporating incentives based on lead generation into their SIPs.
This parameter is driven by the organisation’s product portfolio. It is being added to SIPs for a number of key reasons:
The unprecedented pace of transformation in the life sciences industry demonstrates the need for innovative and dynamic SIPs. Such plans must:
These metrics include doctor/call ratios, the level of adoption of virtual platforms and channels for engagement and content delivery, product knowledge, customer satisfaction scores and lead-generation results.
The right SIP can go a long way towards helping an organisation achieve its strategic goals and boost its operational excellence. It can help leadership to keep the focus of their sales force on the right/desirable behaviours and actions. In turn, an effective SIP can help build a healthy sales organisation by enhancing its overall performance culture, ensuring discipline and driving innovation.
*2021 Pharmaceutical Field Force Rewards Benchmarking Study (Mercer partnered with sixteen global pharmaceutical organisations to analyse and report their sales incentive quantum and insights from their practices)
**This metric has been taken from Sales Incentive plan study for large Medical devices.
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