KAM in the Pharmaceutical industry | In the first part of this article, we discussed the different types of strategic accounts you can encounter in the pharmaceutical industry, detailing the 5 key success factors for your KAM strategy. Today, we are going to dig deeper into the distinct steps of a successful Key Account Management plan.
How to implement a Key Account Management Plan
There are 7 steps that need to be followed for a successful Key Account Management action plan in the pharmaceutical industry:
1. ACCOUNTS’ ANALYSIS
Get an overall understanding of each account and collect the right input to segment your accounts effectively.
2. ACCOUNTS’ SEGMENTATION
Segment your accounts according to the right dimensions and criteria. Then, identify which ones are most important in order to prioritize (Key / Strategic Accounts).
3. UNDERSTAND THE DECISION-MAKING UNIT
Identify the key decision makers and influencers, evaluate the level of partnership you have with them. Identify their needs and their areas of interests. Then, identify/map working links among stakeholders.
Perform a useful SWOT analysis and make your market diagnosis.
5. SET OBJECTIVES
Define realistic objectives for each of the key performance indicators measured in your analysis.
6. ACCOUNT TACTICAL PLAN
Build an impactful account plan based on the previous steps, using all the resources you have at your disposal. Identify areas where additional resources could deliver greater feedback.
Make sure your actions are well implemented and track key performance indicators to measure their impact. Book and update your plan accordingly.
How to measure your KAM plan's ROI
Typically there are some KPIs usually predefined by top management in line with your company’s strategy. Many companies use the Win-to-Lose ratio, Formulary Status, Penetration index and Revenue-to-Profit ratio. It is very important to always involve the account / customer into the measurement process using satisfaction questionnaire, improvement areas analysis and other measurable items.
In the end, financial data are always the key metrics and should be easily captured from the accounting system and analyzed from an ROI standpoint, as well as from a customer satisfaction perspective. The simple sum of inputs (investments) and outputs (net sales) together with your updated KAM Business Plan / Action planning will help drive successful long term business.
The ultimate goal of a Key Account Manager is to create a mutual value zone where both parties benefit from their collaboration and their relationship grows stronger and stronger. Identifying such opportunities that withhold a real potential of mutual value creation requires KAMs with innate understanding of what healthcare stakeholders expect from a pharmaceutical company, combined with an intuitive sense for business.
For Key Account Managers to be successful, a culture of openness and transparency is needed between the pharmaceutical company and the healthcare providers. Strategic Accounts Management requires fundamental organizational changes.
Massimiliano Nazionale, Commercial Excellence Senior Manager EMEA at Celgene said: “It’s a program, not just a one-off initiative, it’s a long-term cultural change. You have to analyze the external environment and also the internal scenario within the organization. Then identify the opportunities and the challenges, and by linking these to your capabilities, you can focus on the priorities and on the change you want to achieve to be successful.”
What makes the Actando approach so different?
Our blended learning approach seeks to maximize learning retention by combining in-class simulations-based courses with eLearnings, assessments and implementation tools. This learning methodology has proven to facilitate immediate understanding and mindset change, in a way that allows the flexibility required in today’s busy corporate environment.
Our Key Account Management program teaches you how to build and implement an account plan. It follows the Key Account Planning Process that maximizes impact with an optimal return on investment. Participants practice this process step by step using the impact Key Account Management simulation/serious game. If you want to learn more, download our detailed Key Account Management brochure by clicking the button below:
Key Take Aways
- KAM is the way you operate your business: it’s a business model, not a sales model.
- Not every account needs a KAM approach at any time: it is important to identify, segment and prioritize customers.
- The number of KAMs differs from the number of sales representatives. With KAMs, some areas have none, other areas have several.
- KAM is about building long-term strategic partnerships with the right types of organizations and the right people in these organizations.
- KAM is more than hitting sales targets, it’s about reaching the business objectives over the next five years and maintaining it.
- KAMs need to work with brand teams to understand the patient’s journey, and then map across key decisions and who will be making those decisions.
- KAM is about being a voice back into the organization.
- KAMs are the conductors of their environment: they know who the right people are and they know what’s needed and when it’s needed.
- KAMs need to ensure they have the proper knowledge and understanding of different company functions, and know when they need their colleagues’ expertise.
- The pharmaceutical industry needs to change from brand-centric to customer-centric thinking.
- Understanding customer needs and providing appropriate support is key.
- It is all about building relationships that can grow into a strong partnership.
- All programs should be evaluated and customer feedback should be incorporated into future strategies.