What Does the Future of Work Look Like for America’s Biopharma Sales Force?

In this installment of the Harvard Business School Healthcare Alumni Association (HBSHAA) Q&A series, Michael Wong speaks to Harvard Business School Professor Joseph B. Fuller about the C-suite's role in the future prospects for pharma sales forces as they face more restrictions on accessing their target physicians and looming concerns of automation.

Michael Wong: With this industry’s sales force dropping from 102,000 to 68,000 between 2005 and 2017,1 what are the prospects for these frontline workers as they continue to face several challenges, including more restrictions on accessing their target physicians as well as looming concerns of automation?

Joseph B. Fuller: For this industry, and frankly any industry where there are inefficiencies, continued disruption of operating models will occur and jobs which have routine tasks will likely be replaced. Changing business landscapes impact even the strongest of companies.Back in the 1990s, I was consulting for Merck’s C-suite, and they were on a seven-year run as Fortune’s Most Admired Company across all industries, not just pharma.2 During those glory days, blockbuster brands justified an operating model which, despite having huge inefficiencies of sales reps waiting in offices and driving around in traffic; given the profit margins on those products the marginal cost of adding a new frontline employee was far exceeded by this person’s generated marginal revenue. Still, as the industry has matured, processes like samples being shipped versus hand-delivered to doctors have reduced the number of reasons for healthcare professionals to rely on huge field forces. Moreover, the overall healthcare ecosystem’s cost as a percentage of our country’s GDP has grown and frankly is not sustainable. Yesterday’s human wave approach to detailing will simply be unsustainable. And for these reasons and many others, I believe this industry’s C-suite will have to accelerate their digital transformation for efficiencies and these steps will include reducing the number of front-line sales employees.

In the past, this industry often tapped into contingent sales organizations to amplify their reach and frequency goals with targeted healthcare professionals. Perhaps if these C-suites reduce the number of their own FTEs,they might resort to a prior playbook of recruiting such contract employees? If they do, what recommendations would you suggest to biopharma’s front line?

Given my efforts with the Harvard Business School’s Managing the Future of Work3 and the many conversations with C-suite leaders across different industries, a common theme has emerged. Executives are striving to sculpt new organizations that have a smaller permanent workforce by relying more heavily on digital technologies and a contingent workforce. How will this affect strategy in biopharma and, specifically in sales? Let’s think about the implications at three levels—the CEO/C-suite, sales management and for an individual professional representative.

First, for C-suite executives, one needs to consider how COVID-19 has highlighted the role and importance of digital transformation skill sets for one’s talent base. In past decades, there was a heavy bias for executive recruiters to provide candidates who had industry experience. However, I’ve personally seen how digital competencies have become the new table stakes. Digital skills are unlikely the skills that companies traditionally emphasized in hiring, because they are largely industry agnostic. Every company wants people with digital skills and, often, the same digital skills. Industry experience is a nice-to-have asset, but no longer an absolute requirement. This trend has huge implications for C-suites since their future-state workforce, while smaller, need to have digital skills to effectively engage with external and/or internal clients. And if a computer science graduate can be just as attractive to Apple as she is to Goldman Sachs as she is to the National Security Agency, what does that mean for a biopharma employer who is competing for such computer-savvy employees? Some organizations, like AT&T, Prudential Financial and Unilever, have realized the potential value of upskilling their workforce versus trying to upgrade them by hiring new recruits in the hyper competitive spot market.4

Second, for biopharma sales management leaders who are responsible for implementing new strategies, you need to harness digital tools that will help your team be more efficient. With so much variation across the country regarding COVID-19, what tools can you provide so that your field force has the capacity to not only meet in-person, but also engage remotely, both in real-time and asynchronously. Other industries like financial services are ahead of biopharma. Firms like American Express tap into software which can sense clients’ emotions (impatience, anger,etc.) during help-desk calls that influence how quickly and who engages the customer. Moreover, since you will be accountable for recruiting new talent, be they FTEs or contingent workers; be willing to adjust your potential biases around who are the best candidates. If you’re a long-term successful sales manager in this industry, you’ve likely benefited from having deep expertise in this industry and as we often hire in our own image, you might exclude those tech-savvy, but no biopharma experience, candidates. Again, what might have been the successful playbook of the past does not have the same value as it did during pharma’s glory days. And recognize that recruiting contingent workers will be much more difficult than in the past where contract sales reps were using that platform for entrance to FTE positions at Merck and others.Several people desire to work as contingent employees and some forecasts believe 2027 will usher in a majority of freelance workers for the US workforce. With Heidrick & Struggles’ earlier acquisition of the Business Talent Group this year and the IPO’s of Fiverr and Upwork, contingent workers’ importance seems to be validated.5

Finally, for the frontline workers in this industry, two pieces of advice. First the challenging news: most companies are not good at re-skilling and if you want a sustainable sales career in this industry, you need to hone your skills so that you are able embrace the new tools and processes as they emerge. It’s not going back to the days of providing free donuts and tchotchkes to gain market share. The good news is that jobs which are growing include those requiring strong social skills. Empathy, listening skills, and resilience are key attributes that many of you already have and so if you’re willing to embrace and engage with HQ’s deployed digital solutions, you can position yourself for a continued career within this industry or pivot to a new vertical. Remember, recruiters are becoming more industry-agnostic when it comes to prior experience and being digital is the new table stakes!

Joseph B. Fuller is a Professor of Management Practice in General Management at the Harvard Business School and co-leads the school’s initiative, Managing the Future of Work. Professor Fuller was a founder and first employee of the global consulting firm, Monitor Group. He served as the Chief Executive Officer of its commercial consulting operations until 2006 and remained a Senior Advisor to the firm until its acquisition by Deloitte in 2012. Professor Fuller received his MBA from the Harvard Business School and his bachelor’s degree from Harvard College.

Michael Wong is an Emeritus Board Member of the Harvard Business School Healthcare Alumni Association.

References

1. Branch, Jordan and LaMotta, Lisa, Pharma Sales Force by the Numbers, BioPharmaDive, Sept 18, 2017.

2. https://www.thepharmaletter.com/article/merck-co-most-admired-us-firm

3. https://www.hbs.edu/managing-the-future-of-work/Pages/default.aspx

4. Caminiti, Susan, AT&T’s $1 billion gambit: Retraining nearly half its workforce for jobs of the future, CNBC, March 13, 2018.

5. https://www.consulting.us/news/5834/heidrick-struggles-buys-freelancer-marketplace-business-talent-group