Sales Force Effectiveness is Dead ... or is it? Five opportunities for pharma to get ‘back to basics’ and immediately lift sales performance. Blackdot are a full service benchmarking, consulting, training & advisory firm exclusively focused on lifting sales force effectiveness & efficiency. Blackdot exist to assist their clients to achieve more predictable, repeatable, and sustainable sales performance. What makes them unique is their total fixation on the use of data-driven, evidence-based techniques to understand what does (and does not) drive sales performance. By viewing the ‘sales engine’ holistically, as an ecosystem of component parts that work interdependently to impact sales results, Blackdot are able to identify the root cause of what’s inhibiting and enabling your current performance, including quantifying the payoff in actually getting it right. Armed with this knowledge, Blackdot stand alongside their clients who engage them to define, implement and embed change programs that bridge the gap between ‘hoping’ and ‘knowing’ they’ll deliver top and bottom line performance improvement.

1. Sales Force Effectiveness
is Dead ... or is it?
Five opportunities for pharma to get ‘back to
basics’ and immediately lift sales performance
SFE

2. “The rumours of my death have been greatly exaggerated”
Mark Twain
SFE is Dead!
For many pharma sales leaders, this phrase has
become an industry mantra over the last few years.
For believers of this mantra, the era of blockbuster
drugs, which represents the space in which SFE (Sales
Force Effectiveness) was originally born, has run its
natural course and has now come to an inevitable end.
Enter the generics. How best to respond? Shift towards
quick-fix solutions in the search for more efficient ways
to engage HCPs (Health Care Professionals).
At this year’s leading conference on pharma SFE,
participants were presented with two session options
for the afternoon agenda. The first session focused on
how the digital age has changed the pharma-doctor
relationship. It promised attendees an understanding
of how to best use digital channels and tools (think
iPads and Closed Loop Marketing) to optimise HCP
engagement. The session was delivered to a full-house,
with not an empty seat to be found in the room.
Next door, was the alternative afternoon session - a
panel discussion on what five doctors most valued and
benefited from the pharma-doctor relationship. The
consensus takeaway across all of the doctors was that
the myopic focus on tablet devices and social media
was simply a distraction that stood between them and
their ultimate concern: Patient outcomes.
These doctors all agreed that all of this ‘noise’ did
nothing to enhance or support the integral role
pharma can play in assisting themselves to drive true
patient outcomes. The session was delivered to a
near-empty room. Conference attendees were too
busy next door listening to the technologists, to take
the time to listen to their most important stakeholder the customer.
In contrast, high performing sales organisations both
within and outside pharma have come to recognise the
significant upside opportunity in eliminating as much
noise as possible. They have elevated the focus on core
principles of SFE to address business challenges that
persist across economic and product lifecycles.
So what are the fundamentals of SFE that high
performing pharma companies simply need to get
right?
Let’s begin by defining what we actually mean by
getting it right. Firstly, high performing sales
organisations do the right things. This refers to their
core strategic marketing and sales leadership
capabilities. These organisations are effective at sizing
the prize, ruthlessly prioritising organic growth
opportunities, and getting organised for success
through the appropriate allocation of resources (see
Figure 1).
Benchmark sales organisations:
“Do the right things”
1
SIZE THE PRIZE
& RUTHLESSLY
PRIORITISE
ORGANIC GROWTH
OPPORTUNITIES
2
“Do things right”
GET ORGANISED
(& ALLOCATE
RESOURCES) FOR
SUCCESS
3
RUN TO A FIT FOR
PURPOSE ‘HOW WE
SELL AROUND HERE’
FRAMEWORK
4
RUN EXCEPTIONFREE SALES
MANAGEMENT
DISCIPLINES
5
MINIMISE RAMP
UP, MAXIMISE THE
SWEET SPOT &
ELIMINATE DECLINE
Via …
TARGET MARKET
SEGMENTATION
GO-TO-MARKET
STRATEGY
SALES PROCESS /
MODEL
MANAGEMENT
RHYTHM
TRAINING / NEW
CAPABILITIES
IDEAL CLIENT
PROFILING
OPERATING &
COVERAGE MODEL
SALES ENABLEMENT
TOOLS
GOVERNANCE /
REPORTING
PERFORMANCE /
SUCCESS PROFILING
CUSTOMER VALUE
PROPOSITION
GOAL & ROLE
CLARITY
TECHNOLOGY / CRM
ENABLEMENT
PERFORMANCE
MANAGEMENT
REWARD &
RECOGNITION
Relative Pharma Strength
(v Cross-Industry Benchmark)
Variable for Pharma
(v Cross-Industry Benchmark)
Relative Pharma Weakness
(v Cross-Industry Benchmark)
FIGURE 1 Elements of the sales framework that represent SFE fundamentals
2

3. High performing sales organisations also do things right. This refers to their sales management capabilities.
These organisations possess a fit-for-purpose how we sell around here framework, complimented by
exception-free sales management disciplines. When it comes to capability building and talent management,
these organisations are incredibly effective at minimising new-hire ramp up, maximising the employee ‘sweet
spot’ and eliminating performance decline.
Sales Leadership is about doing the right things.
Sales Management is about doing things right.
What truly defines these high performing sales organisations however, is their refusal to think of these elements
in isolation. By viewing the ‘sales engine’ holistically - as an ecosystem of component parts that work
interdependently to impact sales results – they have been able to accurately conceptualise what SFE is all about,
and identify the root cause of what’s inhibiting and enabling their current performance.
High performing pharma organisations have steered clear of quick-fix solutions that consider things like
multichannel marketing as the panacea to their industry sales execution woes. They similarly reject CRM
(Customer Relationship Management) and CLM (Closed Loop Marketing) strategies as the be-all-and-end-all
silver bullet for achieving true HCP engagement. Instead, these companies have a tempered and holistic
appreciation of what sales force effectiveness is actually all about. These organisations develop an explicit
go-to-market strategy. They all activate an effective sales enablement function. They run to an integrated
management rhythm, and they possess a strong execution spine. Unfortunately, these are (as yet) not features
to be found on the latest iPad.
Over the last five years Blackdot have benchmarked more than 40,000 frontline sales representatives and
leaders, spanning more than a dozen industries across more than 160 countries to build an independent
fact-base of what a high performing sales organisation actually looks like. Through this process, we’ve been able
to understand the relative strengths and weaknesses of the pharmaceutical industry across a hollistic sales
framework.
We’ve identified five pharma-specific, immediately-actionable opportunities that represent a return to core SFE
fundamentals required to drive more predictive and repeatable performance:
1.
2.
3.
4.
5.
Understand what really defines sales performance (in the absence of prescribing data)
Optimise the call coverage model (based on product maturity)
Fix broken linear sales models (in favour of a dynamic buyer-centric dialogue)
Manage your teams’ performance dynamically (vs. a one-size-fits-all approach)
Incentivise to drive behaviour change (and acquire a true performance culture)
SFE is far from dead for pharma. For many, the failure to recognise the benefits to be gained in getting back to
basics represents a significant missed opportunity. For high performing pharma companies, these universal,
enduring and proven principles bridge the gap between hoping and knowing they’re going to hit their sales
targets. Adopting these high-impact and immediately-actionable opportunities will differentiate your
organisation through its response to the unique challenges of pharma and HCP expectations, and enable you to
take advantage of the opportunity that this industry fluidity actually represents.
3

4. Opportunity #1: Understand what really defines sales performance
Why is this an opportunity?
Across all industries, On-TargetPerformance (OTP) is by-and-large the
most significant outcome-based KPI
(Key Performance Indicator) of any
sales team. Pharma is an exception.
The lack of doctor prescribing data is
the root cause of this dynamic. This is a
non-issue in transactional sales
organisations such as banks, where the
ability to focus on pipeline or other
deal metrics is present. Furthermore,
relative to other industries, underlying
product demand is highly predictable.
Pharma Benchmark
50%
40%
External Benchmark
30%
20%
10%
0%
0%
50%
100%
FIGURE 2 Distribution of On-Target Performance
(Pharma vs. the External Benchmark)
In the pharma space, this seemingly leaves pharma with two methods for measuring sales
performance:
Method one is to focus exclusively on OTP as the ultimate measure of performance. As Figure
2 demonstrates however, this fails to illuminate performance variance across your sales teams,
and thus prevents you from objectively identifying who your high performers are or what they
do differently to the core. A singular focus on OTP as your sole KPI offers little insight beyond
simply validating the effectiveness of your company’s abilities to forecast.
Method two is to utilise alternative, input and activity-biased compensatory data sources.
When this method is elected, it results in creating an environment of goal diffusion for pharma
reps who are left unclear on what their ultimate goals and measures of success actually are.
This scenario has left pharma companies largely in the dark and in search of another method
to meaningfully define sales performance.
What do high performers do differently?
At any point in time, a salesperson’s financial performance should be evaluated across two key
dimensions:
1. Current performance: Are they above or below their sales target? (the typical metric
used is Year-To-Date OTP); and
2. Performance Trajectory: Is overall sales performance improving or declining? (the typical
metric is CAGR (Compound Annual Growth Rate) or any growth rate measure over
successive time periods)
By considering sales performance in this way, high performing pharma companies have gained
a more accurate and insightful perspective on what actually defines high performance in
pharma sales.
Measuring a
rep’s CAGR
addresses the
limitations and
shortcomings of
alternative
methods of
sales
performance
measurement
without creating
goal diffusion or
impacting
perceptions of
role clarity.
4

5. Assessing performance in this way enables you to gain an early indicator of later performance,
and thus categorise each salesperson into one of four Performance Profiles:
Current Performance vs. Performance Trajectory
Improving
EXCELLING™
Below Target,
Performance Improving
Above Target,
Performance Improving
DEVELOPING™
PLATEAUING™
Below Target ,
Performance Declining
Performance Trajectory
EMERGING™
Above Target,
Performance Declining
Declining
Below
Current Performance v Target
Above
FIGURE 3 The four Performance Profile quadrants acquired when considering a salesperson’s
current performance and performance trajectory
In introducing this second dimension of performance trajectory, companies are able to
determine which Performance Profile each of their reps fall into, and thus objectively segment
their high performers from the core.
25%
% Volume Growth
High Performer reps demonstrate
both high OTP and territory growth
Introducing
CAGR as a proxy
for performance
trajectory
illuminates the
performance
variability
otherwise
hidden within
pharma when
only OTP is
considered


0%
-19%
90%

 


100%

FIGURE 4
Scatterplot of Territory
OTP and CAGR for
Benchmarked Primary
and Specialty Care
Pharma representatives
(2012 data)
110%
Average OTP
5

6. From here, these companies are then able to analyse and understand what their high
performers are actually doing differently. When sales performance was considered using this
two-dimensional approach, many benchmarked pharma clients that had historically only
utilised OTP were frequently surprised by what they saw: not only had the performance
variance snapshot changed dramatically, but reps previously considered to be high or even
core performers were in many instances challenged.
In many cases, reps that were previously thought to be high performers emerged as being in a
plateauing state, with little indication that their on-target performance would continue to rise.
In other instances, the fact that core performers were demonstrably on-the-up had been
totally overlooked throughout previous sales quarters: yesterday’s laggards were tomorrow’s
leaders!
Clarity around who your high performers are is a prerequisite to ensuring all other SFE
priorities are set for success. Whether it’s shaping your sales models to high performer best
practices (see Opportunity #3), dynamically performance managing to the identified bespoke
strengths and weaknesses of your reps (see Opportunity #4), or driving the desired behaviour
changes by rewarding higher performance with higher pay (Opportunity #5) - none of this is
possible until you’ve identified who your high performers actually are.
On-Target Performance becomes a highly effective
measure of performance when combined with
Compound Annual Growth Rate
Using the right
metrics to
correctly define
sales
performance is
imperative,
given the
breadth of
decision-making
and business
implications
that flow from
accurately
defining sales
performance.
So, what can you action immediately?
1
Build a sales culture that elevates Compound Annual Growth Rate to being a joint KPI
that stands alongside On-Target-Performance
2
Integrate consideration of your reps’ performance trajectory into performance
management processes and BAU (Business As Usual) coaching conversations
3
Utilise Compound Annual Growth Rate as a key mechanism for identifying
performance variance across your teams and reward, recognise and incentivise
appropriately
6

7. Opportunity #2: Optimise the Call Coverage Model
Why is this an opportunity?
A goal without a plan is just a wish. High performing sales organisations operationalise their
call coverage models off a clearly defined plan that begins with clarity on customer
segmentation and targeting. This is not a new concept or management construct for pharma.
Pharma organisations have long done this by defining and articulating the company
segmentation and targeting process they expect their reps to use.
The assumption is that this segmentation and targeting process manifests in the planned call
coverage model, which is then executed by the rep.
1
HCP segmentation & targeting
Which doctors represent the largest opportunities
with the greatest probability of success?
2
Call coverage and frequency plan
What call coverage and frequency best aligns with
our strategic objectives?
3
Actual call coverage and frequency
Which doctors will we actually visit and with what
intensity?
FIGURE 5 The three stages required to execute a Call Coverage Model that reflects the company’s defined HCP
segmentation & targeting process
This however, does not always play out as intended, with varying levels of adherence to both
the process and belief in its ultimate utility. These issues are best illustrated by thinking about
your sales team as being made up of the five tribes outlined in Figure 6.
T��� B��������™
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S���-R������
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Don’t follow any process yet
recognise the lack of process
hinders them
Don’t know a segmentation and
targeting process exists, and work
it out for themselves
Defy the defined segmentation
and targeting process and do their
own thing
Follow the defined segmentation
and targeting process, but don’t
see it as enabling
Follow the defined segmentation
and targeting process and see it
as enabling
FIGURE 6 The five tribes of segmentation and targeting process adherence within all sales teams
Building an army of True Believers™ - those that follow the defined segmentation and targeting
process and see it as enabling - is your path of least resistance to guaranteeing predictable,
repeatable and sustainable performance. The recipe includes not just adherence, but also
buy-in to the process to ensure that the fruits of those processes are institutionalised within
and across your organisation. What is interesting is that as an industry, pharma has more True
Believers™ than the high-performing External Benchmark (62% vs. 56%) - on the face of it, a
great situation.
Want to learn more about True Believers™?
hClick?ca/mo.bto.wy u u e c w t h featurehered729Djv&dedbmeryl=pa e _ e = 5 f F b8 or scan the QR Code.
ttp:/ w
7

8. However before we pat ourselves on the back, it’s important to recognise that pharma also
have twice the number of Mavericks (20% vs. 10%) than the External Benchmark, plus a not
insignificant (15%) Compliant population. This means that over one third of pharma reps and
managers do not fundamentally see their segmentation and targeting methodology as
enabling.
This represents an enormous missed opportunity, especially when we remember that relative
to other B2B industries, the pharma prescribing universe is relatively static and well known.
Operationalising the call coverage plan into the call coverage model your reps actually run to
requires them to understand the underlying HCP segmentation and targeting methodology that
gave shape to the plan in the first instance. It also requires them to hold the belief that the plan
will actually enable them to hit their numbers.
Over one third
of pharma reps
and Managers
do not see the
segmentation
and targeting
process as
enabling
More than any other benchmarked industry, it should be possible for pharma to convert their
Mavericks and Compliants into segmentation and targeting True Believers™. Remember – this
army of True Believers™ is your ticket to guaranteeing predictable, repeatable and sustainable
sales outcomes.
What do high performers do differently?
To build this Army of True Believers™, you need to have your sales reps not only understand
the defined segmentation and targeting process, but actually see it as enabling. They need to
truly believe. High performing pharma companies not only make these processes known, but
ensure that their reps perceive the utility in adhering to them. To do so, reps need to see how
following the process will translate into real results.
Client
Large
Size
In one pharma company that
undertook the Blackdot Benchmark™,
the stated strategic goal was to grow
market share with high prescribing
doctors that typically favoured
competitor products. Vision and
practice
however,
were
fundamentally misaligned. Referring
to Figure 7, we see that 58% of all call
activity was in practice directed to
visiting HCPs where call objectives
were to defend existing prescribing
habits and market share.
Prescribing Preference
DEFEND
GROW
58%
Competitor
34%
5%
Small
KEY:
1%
Actual Execution (DEFEND)
2%
Stated Goal (GROW)
FIGURE 7 Pharma client example illustrating misalignment
between the stated Call Coverage Plan and
actually-executed
Call
Coverage
Model.
Percentages allude to the percentage of total
sales calls made throughout the quarter.
In contrst, only 34% of call activity was directed towards visiting HCPs that aligned with the
stated goal of growing market share. Is it any surprise that the number of True Believers were
at sub-benchmark levels when there existed a variance of 24% between who reps were being
told to visit compared to who they felt they really needed to visit?
8

9. In addition to better aligning their call coverage plans and models, high performing pharma
companies also begin with better HCP segmentation and targeting.
Across any industry, prioritisation of customers fundamentally comes down to three principal
questions: Are they big? Do we want them? Can we win them? When it comes to growing
market share, high performing pharma reps will over-weight the latter two of these criteria:
prioritising the upside potential and probability of conversion with HCPs within their
territories. This means they will often go after mid-level prescribing doctors with a strong
competitor prescribing predisposition, so long as they believe the potential for changing
prescribing preferences exists.
When it comes to defending market share, these high performers shift their priorities to focus
on the size of the opportunity being defended, coupled with the attractiveness of the
opportunity (the HCP’s prescribing predisposition towards their company’s drugs).
So, what can you action immediately?
1
Build your army of True Believers™ by ensuring that the call coverage model activated
by your sales teams reflects the call coverage plan that correctly prioritises HCPs
against the right segmentation and targeting criteria
2
Ensure your call coverage plan remains the dynamic and adaptive tool it is intended
to be – ruthlessly disqualify HCPs based on the probability of success determined
throughout the sales quarters and reflect this back in future call coverage and
frequency of visits
3
Prioritise the upside potential and probability of conversion to grow market share. To
defend market share, prioritise the size and attractiveness of the opportunity.
9

10. Opportunity #3: Fix broken linear sales models
Why is this an opportunity?
We’ve just reflected on the five tribes of segmentation and targeting
process adherence, and the criticality of building an army of True
Believers™ to drive predictable, repeatable and sustainable performance.
Within pharma, the role of Mavericks also tells a very interesting and
important story – though this time with respect to your sales model (ie
the methodology organisations expect reps to follow when face-to-face
with HCPs).
Mavericks are those who know there is a sales model, yet choose to defy
it and do their own thing instead, based on the conviction that their way
is better. Whilst a small number of Mavericks provide a healthy agitation
across any organisation, too large a number of these folk indicate there is
something materially wrong with the defined sales model, or signal
negative perceptions of its utility.
Within Pharma, this problem is compounded even
$500,000
further: not only are there more Mavericks (more than
$400,000
2.5 times the External Benchmark), but their revenue
contribution also materially exceeds that of any other
$300,000
tribe by a minimum of 4%. These Mavericks are also the
$200,000
tribe most likely to hit their targets (see Figure 9).
5%
Revenue Contribution
4%
3%
2%
1%
$100,000
The message coming from the industry’s highest
contributors is clear: we get these results by defying the
model you’ve been training and embedding.
$(100,000)
0%
-1%
-2%
-3%
FIGURE 8
Mavericks defy
the defined sales
model and do
their own thing
On Target Performance
FIGURE 9 Mavericks’ revenue
contribution and OTP
materially exceed that of any
other sales tribe’s
$(200,000)
So where exactly is the opportunity?
Pharma possess
2.5x more
Mavericks than
the External
Benchmark
Pharma
Maverick
revene
contribution
exceeds any
other sales tribe
by at least 4%
Firstly,
$(300,000)understand what your high performing
Mavericks are doing differently.
Then, get everybody on-board to systematise and
replicate their success.
Finally, Embed. Embed. Embed.
Undertaking this process is truly the recipe for converting the remaining four tribes and begin
to build out your army of high performing True Believers™ (your ticket to the predictable,
repeatable and sustainable results game).
Understanding what your high-performing Mavericks are doing is the
first step to building your army of high-performing True Believers™
Are Mavericks part of your sales model problem or solution?
hClicke?hcta f ature=here47aN5Xs0_t=v&de k or scan the QR Code to learn more.
t p:/ www.youtube.com/w player_embed
10

11. What do high performers do differently?
It should come as no great surprise to learn that high performing pharma companies have
started to shift away from traditional and linear ‘selling-focused’ models towards more fluid
and buyer-centric sales models.
These sales models are further underpinned by new capabilities and a culture that dynamically
prioritises the HCP universe. They do so through continual and active (dis)qualification of HCPs
based on upside potential and probability. They also increase or decrease their call coverage
and frequency based on the perceived return on effort (see Opportunity #2).
The Blackdot Benchmark has also revealed key insights into what individual high performing
reps are doing differently during their sales calls. When it comes to dealing with HCPs who
predominantly prescribe competitor products (ie. attempting to grow market share), here are
a few of the headline high-performer differentiators:
LONG CALL TACTICS
High performers ask twice as many questions to overtly understand the HCP’s
historic prescribing habits and rationale, as well as perceptions of (their)
products’ efficacy. This is in contrast to core performers, who choose to
simply focus on questions that help them understand the HCP’s typical
patient profile.
INFLUENCE AND EDUCATE HCPs
High performers identify the relative weaknesses of competitor products
almost twice as much as core performers, who focus more so on illustrating
the patient profile they believe is most likely to derive therapeutic benefit.
CLOSING TACTICS
High performers focus (38% more) on gaining commitment to follow-up with
an educational meeting. They are more effective at sequential selling that
builds incremental continuity within and between calls.
When dealing
with HCPs that
predominantly
prescribe
competitor
products, high
performing reps
ask twice the
number of
questions to
understand
historic
prescribing
habits and
rationale, as
well as
perceptions of
product
efficicacy
So, what can you action immediately?
1
2
3
Identify the mix of sales people across each of the five tribes within your
organisation
Determine where amongst these tribes your high performers are concentrated
Diagnose what this is telling you about the effectiveness of your organisation-wide
sales model
Have you got a critical mass of True Believers™ in your sales model?
http:/ w
Click?ca/mo.bto.wy u u e c w t h featurehereG7B1G=v&dedbmeryl=pa e _ e L Z v 1t8 or scan the QR Code to find out more.
11

12. Opportunity #4: Manage your teams’ performance dynamically
Why is this an opportunity?
Performance management is challenging at the best of times. Within pharma, it is amplified by
unique industry dynamics such as the lack of prescribing data and resultant goal diffusion.
A salesperson’s performance should be evaluated as a function of both their current
performance (ie. whether they are above or below their targets), and their performance
trajectory (ie. whether their overall sales performance is improving or declining). The ultimate
goal of a Sales Manager when managing performance should be to unlock the potential of
each salesperson and support their team to continually improve performance.
With that in mind, the Tight-Loose™ performance management framework outlines the
optimal approach to coaching and managing salespeople to achieve higher performance.
The Tight-Loose™ framework acknowledges that performance management in mature B2B
sales organisations is supported by a mix of organisational ‘non-negotiables’ (driven top-down
by the business and enabled by HR) as well as manger-determined processes and practices.
Ultimately, armed with this knowledge, Managers can adopt the management style that best
suits each individual salesperson’s development needs and performance management
requirements. They do so across the three stages of performance management, by applying
a ‘tight’ or ‘loose’ approach within each respective stage.
1. SETTING
OBJECTIVES
2. SUPPORTING AND
GUIDING PROGRESS
3. EVALUATING
PERFORMANCE
Communicate and agree on
SMART objectives that
detail the right mix of
individual activity, pipeline,
behavioural, learning and
performance goals
The approach used to
provide feedback and
optimise the focus,
formality, frequency and
depth of coaching provided
(with the salesperson’s
input)
Periodic review against the
defined SMART objectives
and agreed activity,
pipeline, behavioural,
learning and performance
goals
For each rep,
Sales Managers
can elect to take
a ‘loose’ or
‘tight’ approach
to optimise
performance
management,
with the
optimal
approach
dependant
upon the
individual
salesperson’s
Performance
Profile.
FIGURE 10 The three stages of the performance management management cycle
The Manager’s Tight-Loose™ adaptation of their management style across these three stages
will influence the frequency and intensity of the coaching and performance management
each individual rep should receive. For each of the four Performance Profiles, there’s both a
right and wrong Tight-Loose™ mix, determined by the current performance versus
performance trajectory balance.
12

13. The Tight-Loose™ Performance Management Framework
Improving
EMERGING™
Performance Trajectory
TIGHT
LOOSE
TIGHT
EXCELLING™
TIGHT
LOOSE
LOOSE
“Expand their horizons”
“Let them go for it”
DEVELOPING™
PLATEAUING™
TIGHT
TIGHT
TIGHT
“Keep them focussed
Declining
Below
TIGHT
TIGHT
LOOSE
“Reign them in”
Current Performance v Target
Above
FIGURE 11 The Tight-Loose™ Performance Management Framework outlines the
right ‘tight-loose’ mix for each of the four Performance Profiles
At each stage of the Performance Lifecycle, there is an optimum mix of Tight-Loose™ that can
be used to manage performance. If people are managed in this way, individual rep
performance is able to be optimised. As an industry however, pharma are getting the mix
wrong. In fact, in 79% of cases, pharma have deviated from the optimal mix of Tight-Loose™
and have failed to manage their reps in in the way they should be managed based on their
Performance Profile.
WRONG
68%WRONG
79%
RIGHT
32% RIGHT
21 %
The
performance
management
style utilised
within pharma
is wrong in 79%
of all instances
FIGURE 12
Pharma vs. External Benchmark comparison of the
frequency with which the optimal Tight-Loose™
performance management mix is utilised by
Managers across the four Performance Profiles
Pharma
What do high performers do differently?
High performing managers (across all industries) consider the current performance trajectory
of each of their frontline reps in addition to their On-Target Performance. As discussed in
Opportunity #1 (understanding what really defines sales performance), it is essential to gain
clarity on the KPIs that truly demonstrate performance within pharma. This requires thinking
beyond just OTP to consider KPIs like CAGR as a relevant measure of performance trajectory.
In doing so, high performing managers are able to effectively categorise their frontline reps into
the Performance Profile (Developing™, Emerging™, Plateauing™ and Excelling™) that is
relevant to them. These managers then embark on the journey of transitioning each and every
one of their reps up the curve. They do this by setting the right Tight-Loose™ objectives across
each of the three stages of performance management (setting objectives, supporting and
guiding progress, evaluating performance).
13

14. So, what does right look like across each of the stages?
SETTING OBJECTIVES • Salespeople should always have clearly defined goals and
objectives
• Setting objectives should always be ‘tight’
SUPPORTING & • If performance trajectory is declining, a tight (hands-on,
GUIDING PROGRESS
high-touch) approach to supporting and guiding progress is
required
• If performance trajectory is improving, a loose (hands-off,
low-touch) approach to supporting and guiding progress will be
more appropriate
EVALUATING • If current performance is below target, a tight (consistent and
PERFORMANCE
specific) approach to evaluating performannce will be required
• If current performance is above target, a loose (ad-hoc and
general) approach to evaluating performance will be more
appropriate
So, what can you action immediately?
1
Identify whether each of your reps are developing, emerging, plateauing or excelling
by considering their current performance as well as performance trajectory
2
Based on the Performance Profile each rep falls into, understand what the correct
Tight-Loose™ mix is across all three stages (setting objectives, supporting and guiding
progress, and evaluating performance) of performance management
3
Provide your reps with individually-relevant performance management and coaching
with the correct focus, frequency and intensity based on their profile needs
14

15. Opportunity #5: Incentivise to drive behaviour change
Why is this an opportunity?
Across our entire Blackdot Benchmark™ database,
the number one motivator for sales reps is financial
incentives. They are a critical building block in
ensuring you possess an effective, high-performing
sales culture that drives the right sales behaviours.
Bonus as a % of Total Compensation
40%
Yet the average pharma reps’ incentive scheme is
significantly smaller than those of non-pharma reps
in absolute dollars. A pharma rep stands to gain
only 3-12% of their base salary, compared to
11-32% of the base salary of a rep in a non-pharma
industry (see Figure 13).
Non-Pharma
30%
20%
Pharma
10%
0%
On Target Performance Deciles
FIGURE 13
Pharma vs. Non-pharma comparison of
bonuses as a percentage of the total
Representative’s compensation
Even more puzzling is that within pharma
companies, when compared to non-pharma
industries, higher performance is not rewarded
with higher pay. This has significant repercussions.
For your high performers there is no incentive (or positive consequences) to outperform.
These individuals will consequently often seek out organisations that do reward and recognise
their high performing attributes through various discretionary bonus and incentive schemes.
These flight risk consequences have the potential to materially impact future top and bottom
line results. For your core performers, it simply reinforces the perception that there are no
consequences for mediocre or poor performance (see Figure 14).
The average
pharma rep’s
at-risk incentive
scheme is on
average 14%
smaller than
that of a
non-pharma rep
Pharma’s poorly aligned incentive schemes thus reinforce the wrong behaviours for both high
and core performers, and undermine a central platform required for possessing a true
performance culture. It creates additional organisational inefficiencies (through higher
cost-to-outcome ratios), and results in allocating from the pool of discretionary funds to
salespeople that aren’t necessarily generating you comparative uplift.
You cannot have a performance culture without positive and
negative consequnces of over and under performance
The following pharma client example (see Figure 14) demonstrates the risk posed by an
incentive compensation scheme that’s poorly aligned to performance.
IS THE INCENTIVE COMPENSATION SCHEME …
… FAIR AND EQUITABLE?
… DRIVING THE RIGHT FOCUS & BEHAVIOURS?
… BASED ON MERIT?
33%
67%
33%
100%
100%
33%
33%
High Performers
67%
100%
Poor Performers
33%
High Performers
Agree
Disagree
Poor Performers
High Performers
Poor Performers
Strongly Disagree
FIGURE 14 Pharma client example of high vs. poor performer pereptions on the incentive compensation scheme
15

16. When it came to perceptions of whether the incentive compensation scheme was considered
fair and equitable, the vast majority disagreed. When asked if it was based on merit, that same
number now strongly disagreed. Finally, when asked whether it drove the right focus and
behaviours, each and every high performer disagreed.
These numbers are in resounding contrast to the company’s poorest performers, all of whom
believed the incentive compensation scheme was fair and equitable, based on merit and drove
the right focus and behaviours.
What do high performers do differently?
High performing pharma companies recognise that to have a market-competitive incentive
compensation scheme that is perceived as fair and equitable, based on merit, and drives the
right focus and behaviours is an absolute non-negotiable to being the high-performing sales
organisations they aspire to be.
These companies know they cannot expect to have a true performance culture unless there
are known consequences for both under-performance and over-achievement, and reflect
this understanding through the incentive schemes applied throughout their organisations.
As evidenced by the External Benchmark, high performing companies implement incentive
compensation schemes that are larger in both absolute dollar terms and the relative extent to
which they reward higher performers with higher pay from the pool of available discretionary
incentive dollars.
Whilst some operating environments are more regulated than others, and result in an
institutionalised cap on the absolute amount able to be invested in the pool of available
discretionary funds, the principle of rewarding higher performance with higher pay remains
unchanged.
So, what can you action immediately?
1
Determine the extent to which your company has an ‘at risk’ incentive scheme that
reflects cross-industry levels of performance pay
2
Ensure your performance management framework is able to effectively reward
over-achievement
and
incorporate
mechanisms
for
dis-incentivising
under-performance
3
Communicate new BAU (Business As Usual) incentive scheme principles and
performance management frameworks to gain frontline buy-in and promote an
organisation-wide performance culture
16

17. Summary
Technology vendors are busy preparing their eulogy speeches and sales collateral signalling the sad, yet timely
departure of SFE. Efficiency-focused solutions like downsizing field forces will be legitimately implemented, and
budgets will be re-shuffled to acquire the flavour-of-the-month point solution. Distraction risks will be aplenty,
with an excessive focus and commensurate investment dollars spent on digital solutions, Closed Loop Marketing
strategies and the like.
Amongst all this noise, shrewd pharma companies are recognising that SFE is far from dead. They understand
that SFE is not about the quick-fix solution to the current pressures of the day. It involves viewing your sales
engine holistically - as an ecosystem of component parts, that work interdependently to impact sales results.
They perceive industry shifts as the opportune moment to return to basics and make sure the house is in order
by simply doing the right things (sales leadership) as well as doing things right (sales management). They
recognise that core SFE capabilities represent a necessary precondition across all economic and product
lifecycles.
Whilst there are fundamental and universal principles that hold true across all industries, the five opportunities
outlined here represent quick-win, high-impact and immediately-actionable SFE priorities that have proven
timely and relevant for benchmarked pharma companies. High performing pharma companies know that
returning to core SFE priorities like these is what’s actually required to move the needle.
In times of uncertainty, it is those that return to these universal, enduring and proven basics that will not only
survive the tides of uncertainty, but prosper amidst the headwinds of unprecedented industry challenges.
17

18. About Blackdot
Blackdot exists to assist our clients to achieve more
predictable, repeatable, and sustainable sales performance.
What makes us unique is our total fixation on the use of
data-driven, evidence-based techniques to understand what
does (and does not) drive sales performance.
By viewing the ‘sales engine’ holistically, as an ecosystem of
component parts that work interdependently to impact
sales results, we’re able to identify the root cause of what’s
inhibiting and enabling your current performance, including
quantifying the payoff in actually getting it right.
Armed with this knowledge, we stand alongside our clients
who engage us to define, implement and embed change
programs that bridge the gap between ‘hoping’ and
‘knowing’ you’ll deliver top and bottom line performance
improvement.
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