Friday, January 28, 2011

SUCCESS TIPS FOR FRONTLINE MANAGERS - 1

PREPARATION OF CUSTOMER LISTS

You will agree that the first step towards achieving sales success is to help your team members in preparing right CUSTOMER LISTs. You will also agree that the Pareto principle (also known as the 80-20 rule) is generally applicable to CUSTOMER LISTs as well.

TIP 1 - BASICS

How well do you involve yourself in the preparation of CUSTOMER LISTs by your team members?

a)   I approve CUSTOMER LISTs prepared by my team members.

b)   I sit with them when they prepare the CUSTOMER LISTs every year.

c)   I believe that CUSTOMER LIST is a dynamic instrument and requires constant revision and re-validation.

d)  I believe CUSTOMER LIST is important enough to demand my team members discuss with me every CUSTOMER that they include in their lists.

e)  I validate during my field work every top CUSTOMER that my team members include in their lists. In a 3-tier CUSTOMER LIST I shall try to validate every CUSTOMER in the second tier as well because in applying the 80-20 rule the 20% is too important to make up for the 100%. [A 3-tier CUSTOMER LIST of 300 CUSTOMERs roughly has the following proportion: A = 60, B = 120 and C = 120.]

Is your answer a) or b)? But that is what every FLM does. If you want to be successful your answer should be c), d) and e).

You may wonder, “Should there be no delegation at all?”, “Should I hand-hold my team members even for such an elementary task?”

The answer is ‘yes’, at least in the initial stages. Let the salience of the right CUSTOMER LIST to their success sink in. When you are sure of this you can gradually ease controls.

[Remember the situational leadership grid. Depending on the maturity / readiness level of your followers you DIRECT them in the first phase; COACH them in the second phase; COUNSEL them in the third phase and DELEGATE to them in the fourth phase.]

But you will continue to validate CUSTOMER LISTs even after your team members reach the maturity / readiness level for DELEGATION. Remember it is one of the objectives of your joint field work.

TIP 2 - WHO IS ‘TOP CUSTOMER’

The question we are asking is not, “who is ‘a’ top CUSTOMER?” We are trying to define the generic term ‘TOP CUSTOMER’. Yes, who is ‘TOP CUSTOMER’? What is the criterion for defining ‘TOP CUSTOMER’?

a)   A GP who sees 200 patients a day but when he prescribes a medicine he prescribes 3 tabs (presumably a day’s course) and asks the patient to come back ‘tomorrow’.

b)   A specialist who sees 30-40 patients in a day and who prescribes a month to three months’ course.

c)   A busy specialist who is very difficult to meet – he meets medical representatives once in a week at a specified – possibly at an odd and inconvenient – time. There are usually 30-40 competitors waiting to get a few seconds of his time, when we call on him.

d)  You have to travel 100 kilometres to meet him but he meets medical representatives at 8.30 A.M. There are usually 10-15 competitors waiting to meet him, when we call on him.

e)  The doctor is a busy professional all right, but meeting her is such a pleasure as she ‘discusses’ with you a wide range of subjects and even offers tea.

Are these the only criteria why we have such a ‘TOP CUSTOMER’ in our list; because all others have them on their lists?

From a business point of view, the doctors / specialists described @ b) and c) are preferable to the one described @ a). However any doctor described @ a) to e) should satisfy the following conditions to be included in the ‘TOP CUSTOMER’ category.

A thumb rule to define ‘TOP CUSTOMER’ is that the doctor has the potential to prescribe large quantities - qualitatively and quantitatively - of our products.

a) The doctor prescribes the type of products that my company offers, in large quantities.

b)  The doctor prescribes either my brands in large quantities or

c)  The doctor prescribes my competitors’ brands in large quantities and therefore there is a possibility to convert him to prescribe my brands.

[There is a caveat to the ‘possibility to convert’. It should be achievable in a specified time-frame. One can’t eternally invest time and energies on someone hoping that some day it would yield fruit. If it is going to be a long drawn struggle, such a doctor could be retained under a down-graded classification.]

d)   The doctor is amenable to requests for support when there is an urgent need.

E.g.: 1. You are in the run for a sales contest.

E.g.: 2. You have a quantity of a product nearing the end of its shelf life. This should not happen under an ACE FLM like you but then it does - at times.

[Some might question the ‘amenable to requests’ premise, on the ground ‘my doctors’ continuously prescribe ‘my brands’ and never veer to competitors’ brands. That this is an erroneous assumption was proved by a survey conducted by a market research organisation several years ago. According to the survey report, doctors usually prescribe a brand - after effective detailing – for an average of three days.]

TIP 3 – THE “B” CATEGORY

Which type of CUSTOMER belongs to the “B” Category?  It is the kind of CUSTOMER who could not be accommodated under the “TOP” list but almost deserves to be. It is best illustrated by the university gradation system. We shall use the same with slight modification to avoid confusion:

A = above 75% marks in the aggregate - also known as ‘Distinction’

B = 60% - 75% marks in the aggregate – first class

C = 50% - 60% marks in the aggregate – second class

If we apply the same analogy to a doctor how do we classify someone who has achieved, let us say 74% or 70 - 75%? It is this kind of doctor who with some effort from us can move up the scale that generally qualifies to be in the “B” Category. But the general criteria for inclusion in the list remain. Therefore at the risk of repetition let us recount the criteria:

a)   The doctor prescribes the type of products that my company offers in large quantities.

b)   The doctor prescribes either my brands in large quantities or

c)   The doctor prescribes my competitors’ brands in large quantities and therefore there is a possibility to convert him to prescribe my brands.

d)   The doctor is amenable to requests for support when there is an urgent need.

In this category we can one more type of doctor:

e)   The doctor can influence purchase by a hospital / institution in large quantities.

The reason for including this type of doctor in “B” category is that although the doctor can influence purchase of large quantities of our products,

a)  such purchases are occasional, may be once or twice a year. Therefore although it is necessary to cultivate the influencer it may not be necessary to call on him at the same frequency as a “TOP” Category doctor.

b)  we may offer a different kind of “special treatment” – an expensive gift; entertain him for dinner and such like - to this type of doctor.

c)  we offer products at a discounted price – which do not justify the same frequency of ‘call’ as a “TOP” Category doctor. Please remember every ‘call’ is a ‘cost’ to the company. And the call costs also depend upon the category under which it is classified.

TIP 4 - THE “C” CATEGORY

All other CUSTOMERs who can not be accommodated in “TOP” or “B” Categories may be included in “C”. But to extend the analogy of university gradation further, there is a cut-off below which the CUSTOMER does not qualify to be in our list. How do we determine the ‘cut-off’? The ‘cut-off’ simply is the minimum expected business from a CUSTOMER that justifies the expense of a call.  Thus for e.g. the company expects a business of Rs 6,00,000 from a territory and the territory has a CUSTOMER LIST of 200 then the minimum expected business from a single CUSTOMER is Rs 6,00,000 / 200 = Rs 3,000. Any CUSTOMER who can not produce a business of less than Rs 3,000 does not have a place in our CUSTOMER LIST.

We have, in this article, used the word “CUSTOMER” in most places but occasionally the word “Doctor” is used. As we are in the pharmaceutical industry it is generally agreed that our principal “CUSTOMER” is a “Doctor”. But occasionally we may have to include a non-Doctor in our CUSTOMER LIST, for e.g. an influential pharmacist or other purchasing authority like the administrative head of a large purchasing institution. All such “CUSTOMERs” may be included under the “C” Category, with appropriate provision for special treatment.

TIP 5 - WHAT SHOULD BE AVOIDED?

As a true professional you as an FLM will not allow the inclusion of certain kinds of doctors in your CUSTOMER LISTs for the sake of convenience:

a)  There is a couple – a husband and a wife – who sit together but only one has the potential to be our CUSTOMER for a variety of reasons.

                     i. The husband / wife does not see many patients but sits along with his wife or vice versa.

                   ii. The husband / wife practices in a therapeutic area in which we do not operate or are currently promoting our products.

                  iii. The husband / wife generally takes care only of the hospital administration.

This interesting anecdote not only illustrates the kind of situation that people in the field face but how tactfully a smart PSR handled a particular situation by injecting a little humour and audacity into it:

Many years ago SK&F (long before its merger with Glaxo to become GSK) specialised in gynaecological products and was known for its aggression in the market place. On an occasion it operated a special campaign as a part of which gynaecs were given expensive gifts. A SK&F PSR had to call on an important gynaec who was sitting along with an ophthalmologist in a clinic in a district headquarters town. In this instance the ophthalmologist was not her husband but a partner sharing the clinic. The PSR detailed first products specific to their specialities and then the common products. He distributed samples appropriate to their specialities. At last looking both of them squarely in the face he informed them with a smile, “…And we are a bit partial to gynaecologists…” With that he boldly produced the special gift for the gynaecologist and handed it over.

It is needless to point out that so smart a PSR enacted the necessary drama as if he were giving away a million dollar gift! The gynaec laughed heartily to receive such special treatment, the ophthalmologist looked on smugly as if it did not matter but both of them were not a bit surprised by the PSR’s boldness and tact and the PSR continued merrily on his rounds.    

b)   There are 10 doctors in a small town or a hospital, sufficient for day’s norm or call average but only 7 out of the 10 are eligible to be included in the CUSTOMER LIST.

In all these cases you of course as a true professional FLM will not permit pubic relations considerations or individual convenience to override business interests in the preparation of CUSTOMER LISTs but the more important thing is to convince your team members to do so willingly and not under compulsion. And that is the litmus test for leadership!

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