Skip to main content Skip to Footer

BLOG


April 29, 2014
The Customer-Centric Pharmaceutical Supply Chain
By: Hussain Mooraj

We recently updated our high performance biopharmaceutical industry study, which looks at the long-term performance of 16 of the largest pure play pharma companies.

The good news is that there is evidence of industry recovery and more companies are showing positive future value. It is also clear from our research that the high performers are focusing on science and placing far greater emphasis on the patient. Just last week, Sanofi announced the appointment of a Chief Patient Officer—this is what we call the “pivot to the patient”.

All this to say, the definition of our customer is changing. The ultimate role of the extended supply chain is to create material value at the point of consumption. This means that moving forward, supply chains will be measured on their ability to deliver this value. In one example, a supplier of saline fluid collaborated with a hospital by taking over the supply of its products within the hospital. They saw dramatic improvements in availability at point-of-use which translated into benefits in traceability, inventory and more time for nurses to spend on other tasks.

In a customer-centric supply chain, this ability to create mutual value at the point of consumption becomes the driving principle - with the patient becoming the ultimate customer. To be a truly customer-centric supply chain driving end-to-end value, we believe that there are four key supply chain responses:

Segmented and demand-driven chains
I heard a story recently where an employee visited the hospital for a flu injection and specifically asked for the company’s vaccine. He was told, however, that the hospital doesn’t stock the product because the box was too big for their shelves. It is clear that seeking the voice of the customer would have identified this issue to the benefit of the patient, hospital and the manufacturer.

After having defined the types of customers and the different services, the supply chains must select where they will drive value, where they need to share platforms, and how far up the chain the push/ pull boundary should be.

Value chain orchestrator
Responding to the voice of the customer requires horizontal thinking that crosses functional boundaries. In practical terms, adhering to the voice of the customer requires true alignment to unlock value in the end-to-end value chain.

Consider P&G’s whole business, from sales back through supply chain and into R&D is driven by two moments of truth every day.¹ The first at the store shelf, when shoppers choose which brands to buy; and the second at home, when consumers decide whether their products delivers on the brand promise. Winning at both of these moments of truth, demands deep shopper and consumer understanding. P&G learns from more than four million consumer and shopper research interactions each year—in testing labs, in consumers’ homes, in stores, and on the Internet. As we build customer-centric supply chains, we must continually seek our own moments of truth.

Visibility—the rise of the control tower
Control towers help answer key questions from “What is happening now?” to “Why is it like this? What could happen next? What is the best it could be?” to actually driving effective execution on such agreed plans.

End-to-end visibility is indeed a key factor in enabling a customer centric supply chain, and we have both implemented and operated control towers on behalf of our clients.

Capability—the need for big-picture thinkers
It is essential for the workforce to possess the right aptitudes and skills in order to effectively run a sophisticated and highly tuned supply chain. For many years, all of the focus was on manufacturing, and rightfully so. But many among us recognize the imperative to build supply chain talent beyond the four walls of the plant. Ultimately to deliver the benefits, customer centric supply chains need practitioners who can see the bigger picture at all levels. Focussing on talent across all these activities creates the headroom for professionals to build a career and drive up overall capability.

It is clear that the customer needs and desires are changing. The question lies how companies choose to respond to them with end-to-end value.

Source:

  1. P&G 2013 Annual Report

More blogs on this topic

    Archive