Background and Challenge
L.E.K. Consulting's client, a significant manufacturer of sophisticated medical equipment and systems, with sales worldwide, is competing in highly competitive markets against well-entrenched competitors and under increasing pricing pressure. Furthermore, the business’s customers are sophisticated, with multiple roles involved in the buying process (surgeons, purchasing departments, etc.), often with divergent agendas.
This manufacturer engaged us to support the development of detailed plans for 10 priority global markets and to strengthen the capability of the commercial organization to deliver results.
A clear requirement of the work was the direct engagement of the sales teams in the process to co-create a new commercial plan in order to build sales team capability through the process and ensure ownership of the new plan by the organization and confidence in its achievability.
Approach and Recommendations
We adopted a highly collaborative approach to directly engage and empower the client’s management and sales teams in the development of the new commercial plan.
We segmented our client’s existing and prospective customer base in each market to identify customers that represented the highest-value opportunities. This involved collaborating with sales teams to catalog hospitals and build a comprehensive database of key data by hospital in each market. This allowed us to identify a small number of hospitals that represent a high share of the relevant activity volume in each market (typically, segments A+, A and B).
With inputs from the client’s sales teams, we reviewed the position of competing suppliers in each market to identify opportunities to target our client’s sales efforts and gain market share, and established a new framework to drive deeper relationships with the customers of the business and to increase penetration in priority segments.
The work included an assessment of both the current effectiveness of the sales team and the central capabilities and enablers of the sales activity, including optimization of KPIs, recommendations for adjustments to sales force time allocation across activities and customer accounts, and improvements to sales support and market access resources and processes.
Our joint work with the market teams ultimately resulted in a new, detailed commercial plan, as well as the requirements to deliver against it, including:
- Definition of priority customers for sales force to target
- Development of plans for selected key accounts
- Forecast of future sales volume and market share
- Sales territories and resource requirements by role
The work delivered a sales model to drive growth in line with the business’s Full Potential Plan, while enhancing the capability and commitment of the sales teams. The new commercial plan is expected to result in:
- Improved performance
- Systematic, reliable insights on the market
- An empowered local sales team
- Enhanced central capabilities and enablers