Disruptive Change - How does pharma survive and thrive in the world of modern healthcare

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  • 8/6/2019 Disruptive Change - How does pharma survive and thrive in the world of modern healthcare

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    strategy

    DeVeLOPMeNt

    the directory of advertising, branding, creative and digital agencies in healthcare 37www.pmlive.com/thedirectory_digitaledition4

    How do phm nd h nci i pn wih uviv,l lon hiv, in h wold of modn hlhc wh

    diupiv chn h bcom h onl conn?

    as ans o 1980s lms may know, Ferris

    Bueller amously said: Lie moves prettyast. I you dont stop and look round

    once in a while you could miss it. Well lie is

    moving aster than ever beore: we are in the

    middle o a huge upheaval across the globe

    where everything we currently know about

    the pharmaceutical industry and the agencies

    that support them will be turned on its head.

    Welcome to the world o modern healthcare: a

    state o continuous disruptive change.

    This fux is a major challenge or all

    stakeholders involved in the delivery

    o healthcare including pharmaceutical

    companies and the agencies they partner

    with. Competition is exponentially increasing

    at the same time that prots are being

    squeezed and the cost o resources isonly increasing. Expectations or what is

    needed to get to market and then to deliver

    in market are higher than ever and therestrictions on what can be done are ever

    more stringent. It is like being in a searing

    hot desert and every day you are asked to

    run urther and given less ood and water.

    The question is not just can we survive but

    how are we going to thrive? I we cant win

    the game in the present world, how are we

    going to change the rules to win the game in

    the uture world? In order to drive rather than

    react to the changing landscape, we must look

    into the uture o our industry, its direction o

    travel and its potential destination.

    As an embryonic business in 2010 we wanted

    really to understand this uture world or our

    own success and or the success o our clients.

    So we undertook a comprehensive researchproject to explore healthcare in 2025, the

    drivers o change and some potential answers

    to the challenges we ace.First up, some historical context: we have

    achieved an astonishing amount as the human

    race in the 20th century and the potential to

    achieve even more in the 21st century is all

    around us but it depends on how we respond

    to its challenges.

    Achievements in healthcare have saved,

    extended and bettered billions o lives. For

    example, in the UK, average lie expectancy

    rose rom the age o 49 in 1900 to 79 in the

    year 2000 and the percentage o GDP spent

    on health rose rom 1 per cent to 9 per cent

    over the same period. These are amazing

    statistics and similar trends have been seen

    globally. This success also has a consequence

    because or the rst time in the history othe westernised world there will be more

    strategy

    DeVeLOPMeNt

    4

    Disruptivechange -whatsthe fallout?

    disruptivechange.indd 4 10/03/2011 15:00

  • 8/6/2019 Disruptive Change - How does pharma survive and thrive in the world of modern healthcare

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    strategy

    DeVeLOPMeNt

    the directory of advertising, branding, creative and digital agencies in healthcare 37 www.pmlive.com/thedirectory_digitaledition5

    th hlhc wold i chnin f hn v bfo. Ou ch idnifidk div of hlhc chn oupd ino fou k coi

    applinc of cinc

    Science and technology is fuelling a greaterunderstanding o the medical prole o theindividual and its impact on their health

    Communications and integration across IT platformsare becoming the norm. The day o the centralisedelectronic health record is just around the corner

    Wireless technology and miniaturisation are drivingthis integration

    Nanotechnology and DNA-based processors willcontinue the exponential growth o what technologyis capable o

    Indu quz

    The bar is being set higher for the industry onall levels: regulatory approval, demonstration oclinical cost eectiveness and requirements ortrust and transparency

    Pharmaceutical companies are having toconsolidate resources and reduce headcount tomake themselves more ecient

    Patent expiries and a lack of pipeline moleculesare reducing prots

    Emergence of new therapeutic options, such as,stem cell technology and gene therapy threatenthe business model o the pharmaceutical industry

    Nw wold od

    The growth of populations and income in emergingmarkets is increasing economic power but alsoincreasing issues o resource sustainability

    Emerging markets have an economy of scale thatthe western world cannot compete with

    Emerging markets will adopt the internet in wayswe cannot imagine, as they are not hampered bythe heritage and inrastructure o the west

    Emerging markets produce more top-levelgraduates than all the graduates in the US at anylevel. Imagine what all those intelligent educatedindividuals are going to achieve

    Wlh o budn of hlh

    The advances of the 20th century are leadingto real (not uture) issues now in care or theelderly, and management and prevention ochronic disease

    Increasing levels of obesity in the youngerpopulation are driving the development o chronicconditions in ever younger individuals andpushing up lietime costs

    There are a limited number of healthcareproessionals in a sector that requires an everincreasing level o knowledge to be procient

    people over 60 than there are under 20.

    However these advances have also brought

    issues o their own as 20th century structures

    struggle to deal with 21st century problems:

    populations who are living longer, with chronic

    conditions and with higher expectations or

    their health. To add to that challenge, the

    healthcare world is changing aster than ever

    beore. Our research identied key driverso healthcare change grouped into our key

    categories (see chart below).

    aDVersIty BreeDs OPPOrtUNItIesBased on these drivers we painted a potential

    healthcare world or 2025. Within it there

    are many real challenges but it is not without

    its opportunities. In terms o brand building

    and communications this is a world where

    everyone will be walking around with their

    own personal integrated communication

    channel and a world in which people share

    more inormation about themselves than

    ever beore. This is a world where you can

    truly understand the customer and have an

    engaging dialogue with them.

    The pharmaceutical industry is going to

    outsource increasing amounts o the work thatit would have done in-house as it will not have

    enough people internally to do it all. I you

    are innovating and leading your industry you

    are going to be who it chooses to work with.

    Agencies have an advantage: because o the

    nature o the business they are more fexible

    in their structure and less hierarchical in how

    they operate, so they can adapt and respond

    aster to change. Innovative pharmaceutical

    companies will look to harness this capability

    to bring greater value to their own work.

    The pharmaceutical industry will need to

    move to a more integrated outcomes ocused

    industry model from the current product-

    based mindset o the industry. This means it

    will need to build longer term relationships

    with customers and ocus on lietime value

    rather than the blockbuster model o the past.It will be an industry that ocuses on

    lots o small successes rather than one

    that ocuses on the 1 in 100,000 jackpot

    win that bankrolls the business model. I

    we are smart we will work out how to

    generate revenue beyond the product.

    This is a good thing or pharma

    companies and healthcare agencies alike

    because engaging and building lietime

    value relies on some key actors:

    Recognition much like when you see a

    riend across the street you immediately

    recognise them and are engaged to

    communicate with them. The visual identities

    o the uture will need to achieve this with

    customers and they will also need to beenduring while evolving with wider trends in

    the external environment o the customer

    Dialogue continuous engagement relies

    on a two-way communication which means

    that communications agencies need to

    work out how to listen eectively and how

    to respond on behal o their clients

    Sharing and adding value knowledge

    is the new black and the need to stay

    5

    Fast track

    We are in the middle of a huge upheaval across the globe where everything we

    cunl know will b und on i hd

    Pharma and its agencies will need to become adept at shaping their future by

    dvlopin n innl quionin culu

    Lifetime value will become the rule not the exception with opportunities for

    innoviv nci o pn wih phm o c nw lvl of nmn

    We must look into the future of our industry, help drive its direction of travel and

    dvlop nw poduc nd vic now

    A new integrated response across media types, platforms and disciplines will be key

    o compiiv diffniion in h fuu hlhc lndcp

    disruptivechange.indd 5 10/03/2011 15:00

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    strategy

    DeVeLOPMeNt

    the directory of advertising, branding, creative and digital agencies in healthcare 37www.pmlive.com/thedirectory_digitaledition6

    David Coleiro and Michael White

    are partners at Strategic North.They can be contacted at

    [email protected]

    +44(0)7932 006858 and michael.

    [email protected]

    +44 (0)7528 949905

    respectively.

    aLWays tHINK INtegratIONFOr greatNess

    The uture is about integration on three levels.

    The first is integration across media

    types, so the ability to deliver coherent

    communications that integrate text, video,audio and visual images.

    The next integration level isacross

    platforms, so whether someone chooses to

    use sotware by Microsot, Apple, Google or

    Linux your communications work. The other

    element of cross-platform integration is that

    your communications work across mobile

    platorms like smartphone and tablets, and

    across PCs and Macs, as well as translating

    to hard-copy media.

    At this level you also need integration

    between standalone content and the wider

    internet presence that will need to surround

    the brand, and the communications that

    seek to build and support it. This type o

    integration will revolutionise healthcare.In a world ocused increasingly on health

    and wellbeing and packages o care the

    experience o healthcare will be more

    important than ever.

    The third level of integrationis across

    disciplines, so whether that is multi-agency

    or full-service agency integration across

    the disciplines or digital and creative,

    communications will be core to eective

    implementation o uture communications

    programmes. Parties will need to develop

    long-standing working relationships to

    ensure consistency o personality or all

    communications.

    So dont just sit there, take Ferris Buellers

    advice; get out there and start to shake thingsup in pharma. One thing we can guarantee

    is that your uture depends on it. What will

    generate value or you in the uture are the

    innovations you explore and invest in now.

    current is a burden that we have all taken

    on in society. Because o the speed at which

    technology changes you only have two

    choices: either to keep up or be let behind

    and i you are let behind your knowledge

    quickly becomes irrelevant. Companies will

    need to be sharing their knowledge andhelping their customers to keep current and

    to understand the value o what they oer.

    This means a change or the relationship

    between pharma companies and agencies

    that we have already started to see happen.

    This is a move rom discreet project work

    to an ongoing relationship that can provide

    the continuity and understanding needed

    to meet the evolving communications

    expectations o their customers.

    Be DIsrUPtIVe IN yOUr WOrLDSo how should we respond to these new rules?

    First, learn a lesson rom the human heart. It

    has evolved over tens o thousands o years

    to cope with the continuous challenge o theenvironment, where we may at any minute

    need to take fight and run or we may be

    injured and our bodies need to ght to survive.

    How it does this is to be always in a state on

    the edge o chaos. We think o our heart as an

    organ that beats regularly and consistently.

    Nothing could be further from the truth. On a

    minute level every beat o our heart fuctuates

    because the easiest way to respond to the

    change is never to be in a steady state.

    The easiest way to cope with change is to

    actively drive it. Other industries are ar more

    adept at shaping the uture. We have even

    seen recent initiatives rom Microsot, Google

    and IBM on the uture o healthcare. You

    can spot the market leaders o tomorrowin an industry by those who are envisioning

    and shaping that uture today. Ask yoursel

    Where are the voices shaping the uture o our

    industry? What role are we playing in that?

    To cope with a disruptive changing

    environment we need to develop a disruptive

    changing culture because it is easier to

    change and respond i you are always

    changing anyway. You can react aster and be

    urther ahead o your competition because

    you can anticipate what is going to happen.

    Look at your business and ask yoursel, Are

    we comortable or are we continuously

    looking to change. Do we challenge the

    way things are all the time? The rst step

    to driving continuous change is to build aquestioning culture.

    How do you achieve this? Give people the

    time and the remit to explore. Free your

    teams to realise the potential they have and

    you will have sustainable value that clients

    and customers will perceive the value o and,

    increasingly, choose to work with. Google

    amously runs a policy called Innovation

    Time O, where its engineers are encouraged

    to spend 20 per cent o their work time

    on projects that interest them. Some o

    Googles core services originated rom these

    independent endeavours.

    The environment o continuous change is a

    great place to ast prototype ideas and learn

    rom putting ideas out in the real world. Fastprototyping will become core to the uture

    o how the industry evolves. There is the

    opportunity both now and in the uture to

    get eedback and insight aster than ever

    beore and in a world where communication

    is one constant fow i something doesnt

    stick it is gone. There is the opportunity tomove rom getting it right rst time to getting

    it really right during the process by putting

    lots out there and seeing what sticks. The

    pharmaceutical industry will have to respond

    to this world as well and change antiquated

    approval procedures. In a world where

    acceptable response time is measured in

    minutes you cant wait for six sign-offs.

    DIg DeeP INtO tHe DataThe uture is about data. We now generate

    more data per day than ever beore and it is

    exponentially increasing. Consider this: in the

    western world over 75 per cent o people have

    access to the internet but globally less that 25

    per cent o the human population can accessthe internet. Now imagine how that will change

    over the next 15 years and the impact that will

    have on communications.

    Get out there, capture data and understand

    it. Whether you are a creative, branding or

    communications agency, or a pharmaceutical

    company, you need to understand what

    healthcare customers and consumers are

    doing with their time and what motivates them.

    Create platorms that generate this insight

    or you and start to establish channels or

    the uture. The other advantage o this new

    world is that the upront costs o this type o

    approach are minimal compared to what they

    would have been even 10 years ago.

    If you really want to future-proof yourbusiness you should be running initiatives

    in emerging markets, not because you

    necessarily want to be a global business but

    it is a lot cheaper to learn and make mistakes

    in those markets and to bring the successul

    initiatives back to developed markets once you

    have made them work. Think this is a crazy

    idea? Well healthcare providers in the US are

    looking at India to understand

    how to do cardiac surgery

    better and more eciently

    because a process that

    could cost $50-60,000

    in the US can be done

    for $5-7,000 in India

    with comparableoutcomes.

    Inion now nd omoow

    There are already some good examples of media integration:

    Virgin media is exploring what is possible with its iPad magazine Project whichintegrates text, video, touch screen unctionality and wider online content

    Aweditorium is another iPad application that seeks to integrate music rom new

    artists with video and wider inormation aggregated rom the internet to create a

    discovery experience out o nding new music

    Google Health is on its way: a personal health inormation centralisation service

    aimed at helping users manage and share their health inormation online, set

    personal health goals and track progress against them

    auho

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