An Apple A Day Isn’t Enough Anymore - The Pharmaceutical Customer of Tomorrow
There is strong evidence that companies that focus on their customers outperform their peers. Several new forces are now driving a closer, more intense and more “value-laden” interaction between the pharmaceutical industry and its customers. In a recent study, Leonard Lerer and Mike Piper conclude that customer focus will be vital for the prosperity and survival of pharmaceutical companies faced with rapid, unpredictable changes in their operating environment.
The pharmaceutical industry has enjoyed exceptional returns over the past twenty years, employing a relatively straightforward and robust business model. Although it is difficult to frame it in terms of a timeline, the pharmaceutical landscape is changing in a number of ways. For example, payers and providers are increasingly concerned about the explosion in health-care costs. Consumers are also concerned about the quality of their healthcare, and are becoming more actively involved. At the same time, advances in biology and information technology point to more sophisticated drugs and focused customer communication.
This exhaustive study conducted by Mike Piper of the Andersen Pharmaceutical, Biomedical and Health Services Practice, Leonard Lerer, INSEAD Affiliate Professor At Large, and Michael Harrison, INSEAD Post-MBA Fellow, explores a component of the pharmaceutical value chain that has been largely ignored – the interface with the customer. The report examines the benefits of placing the customer at the core of the pharmaceutical company’s existence.
The pharmaceutical industry is deploying considerable resources to become more customer focused. The study talks of the value and status of customer focus in the industry. At the same time there is an attempt to initiate valuable partnerships out of customer relationships. Clinical trials, for example, have evolved from being a drug development tool to building a network of physicians loyal to the company and its products.
