Be Picky: Choosing Key Performance Indicators in the Multi-Channel Engagement Era

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The game has changed

In recent years, increasing challenges faced by Physicians and other Health Care Professionals (HCPs) in their day-to-day activities have forced Pharmaceutical Companies to re-define the relationship with their Customers[1] and to quickly adapt to their changing needs and demands.

Fortunately for the sector, technology has developed[2] to match the challenge:

  1. Mobile devices have greatly enhanced functionalities
  2. Connectivity is now broader, faster and of higher quality
  3. Options for information integration and sharing has increased (portals, apps, push messages, emails etc.).

These technological advancements have laid the foundation for Multi-Channel Marketing (MCM) approaches – the possibility of organizations to interact with their customers through many different platforms and channels. While this offers the unique opportunity to gain deeper insights into customers’ values, preferences, goals and needs than ever before, it poses an even bigger challenge: an enormous wealth of information spread (and trapped) across multiple business units and systems.

So how to stay on top of the game?

The same way a scientist needs to design and execute an experiment to address a scientific problem, the successful implementation and development of MCM approaches requires:

  1. Planning in advance and knowing what is being done – measure Actions
  2. Having information to support decisions – measure Results
  3. Using information to guide actions – measure Impact

Less is more: KPIs

An overwhelming amount of information is recorded and can be extracted from most Multi-Channel systems. However, there is no point in measuring everything simply because it’s possible - but measuring the right metric to answer the right question may bring huge value to organizations.

Nowadays, most companies use Key Performance Indicators (KPIs) to evaluate how successfully their business goals are being achieved. KPIs are a set of measurable and critical (“Key”) metrics selected to support the business decisions and evaluate outcomes.

However, not any set of indicators enables decision-making and the evaluation of outcomes. In order to be effective, KPIs need to be:

Few - the ability to retain information decreases steeply when more than 7 variables are involved[3], so keeping the number of KPIs low helps ensure efficient processing of the information and maximizing its value.

Measurable – in order to accurately capture the effects of actions, KPIs need to be measurable. Can one truly quantify the attainment of goals such as “providing support to…”?

Objective - the purpose of a measurement needs to be evident. For example, what is the true meaning – and, consequently, value - of measuring the average time spent on a specific slide with an electronic detailer?

Clear – it is crucial that users understand how the KPI is calculated. For more complex KPIs there is no need to take a degree in Mathematics but an understanding of what is involved in their calculation is critical to allow interpretation of their meaning and their subsequent use (see below).

Useful – KPIs need to help support decisions and guide actions – if they can’t be acted upon, they have only residual value at best and therefore shouldn’t be measured. This is the most essential characteristic of great KPIs. Only with “Useful” KPIs can a company guide actions on the right direction.

Measurable, objective, clear and useful KPIs have the potential to help organizations measure their Actions, Results and Impact.

Enough theory: How does it work in practice?

For business organizations profit is the most common objective. This is a concept understood and agreed upon by all Business Units but how exactly does each one of them contribute to that common goal in their daily activities?

A solid KPI framework can provide value and guidance by helping translate high-level goals into everyday activities.

Let’s take the following hypothetical example from Sales, for which the goal has been defined as to increase Sales volume by x%. There are different ways in which this can be accomplished. Increased Sales can be based on a “Growing Account” Strategy - having existing Customers buy more of the company’s product(s)—or on a “Capture New Business (CNB)” Strategy—based on the recruitment of new Customers. Having KPIs in place related to Accounts and Key Account Management activities might help evaluate both strategies and decide which to adopt to meet the goals. KPIs such as Rate of New Customers, Coverage (number of Customers over the number of total potential Customers) or Average Sales Volume per Account might therefore help assess which strategy will be more likely to meet the objectives.

Taking the example above, it seems reasonable to state that the Marketing Promotional Materials will need to be developed in line with the selected Customer strategy. Importantly, the Sales Force needs to execute the strategy with the tools provided by Marketing, which in turn requires the insights from the Sales Force activities in the field, so a high level of communication and coordination between the two is required.

One possible way to achieve this, is to have Sales and Marketing defining together the “Journeys” they would like their Customers to experience in terms of the different channels of communication used, the messages conveyed and their sequences (Note: Highpoint Solutions’ knowledge base includes a collection of Customer Journeys based on a Multi-Channel approach). These customer “journeys” could be the basis for Sales and Marketing to jointly define the best KPIs to evaluate the success of current actions as well as to guide further improvements.

As organizations increase the maturity of their CLM, more sophisticated KPIs such as Slide Reaction per Time Investment, Customer Journey Experience, or Customer Satisfaction Ratio can be developed.

Slide Reaction per Time Investment can evaluate whether specific slides require a specific time of discussion to trigger positive reactions, which may be indicative that they are not clear enough, contain too many concepts or information and therefore require the Medical Representative to lengthen the discussions with the HCPs to allow them to understand the information contained in the slide.

Customer Journey Experience is a composite KPI combining the number of channels used, the reaction per slides and frequency of contact with customers. It captures the evaluation of “Right Channel. Right Content, Right Timing”—the mantra of Multi-Channel Marketing—in one single value. By transforming Customer Journey in one number, it allows direct objective comparison among different Customer Journeys to assess which ones lead to higher Customer Satisfaction.

Finally, the Customer Satisfaction Ratio KPI assesses the satisfaction level of Customers resulting from the utilization of advanced analytics platform. It compares the resulting satisfaction of customer when using tools such as Veeva suggestion versus the calls not based on the tool’s usage. KPIs such as this provide a direct evaluation of the performance, and hence allows direct comparison, of this type of analytics platforms, recently growing in number in the market as well as becoming progressively more advanced.

KPIs can (and should) be developed for each area of activity of an organization under the umbrella of a cohesive framework. In fact, one way to develop a concerted and solid framework of KPIs is to identify the business domains and questions to focus on and select the KPIs that better address those questions.

Final considerations

When wisely chosen and coherently integrated in a framework, the benefits of KPIs can go beyond simple measurement and they can further assist organizations in:

  1. Consolidating the Vision and Strategy across the organization
  2. Adjusting processes to promote Channel and Activity Integration
  3. Providing support to activity Execution

As illustrated above, these benefits can translate into broad and significant improvements across the organization: 

 

KPI Framework Enables Vision Integration Execution
Unifying goals of multiple BUs under one common vision for MCM x    
Gaining buy-in across multiple organizational levels by measuring and monitoring the impact of activities and strategy x   x
Promoting the alignment of goals and activities x x  
Breaking silos by establishing touchpoints across BUs   x  
Providing a constant structure to guide processes throughout maturity and evolution   x  
Providing a tool for communication within and across BUs   x x
Assisting in guiding every day activities     x

 

 

[1] (http://blog.highpointsolutions.com/the-criticality-of-kams-in-todays-evolving-market-the-tools-needed-to-support)

[2] (http://blog.highpointsolutions.com/exponential-growth-of-unstructured-data-and-its-risk-to-life-sciences-rd-organizations)

[3] Miller, George A. (1956). "The Magical Number Seven, Plus or Minus Two: Some Limits On Our Capacity for Processing Information". Psychological Review 63 (2): 81–97

Tags: healthcare, KPI, key performance indicator, mcm, multi-channel marketing

   

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