Most pharmaceutical companies have started building some digital capabilities, but they can fragment talent and resources for their efforts, often through hundreds of small initiatives. Without clear strategic direction and strong senior sponsorship, digital initiatives often struggle to secure the funding and human resources needed to achieve a viable scale and cannot overcome barriers associated with inflexible legacy IT systems. Talent and partnerships are also critical issues— many companies realize they need to form partnerships to acquire digital skills and specialist skills but are often unclear about what kinds of partnerships need to be established and how value can be extracted.
We believe that three strategic actions should be taken by pharmaceutical companies to overcome these barriers and start on a path that captures digital value.
Focus on two or three flagship initiatives – It is important to place a few large bets, each of which will be sponsored by a senior executive, made highly visible to the organization throughout the design and pilot phases, and lauded when early winning begins. From the outset, these flagships will need to be appropriately resourced and supported by partnership initiatives that complement the existing capabilities of a company. The goal is to secure early success, resulting in the buy-in and momentum needed to drive the next wave of initiatives. Flagship initiatives must be selected based on the pipeline, product portfolio, and business strategy of a company. Therefore, companies should identify the distinctive value sources that can be created by digital technologies and capabilities in the disease areas in which they operate, and then define flagship initiatives to develop solutions for two or three specific use cases. For example, a flagship initiative could be the construction of a digital ecosystem (a solution that combines sensors, apps, and services) for patient adherence to an upcoming blockbuster oncology launch drug (the use case).
Run collaborative experiments, and then scale what works – In any particular market, companies cannot be expected to know in detail what a winning solution looks like for any particular set of assets. For example, a company cannot design a digital medical affairs ecosystem on paper from A to Z without experimenting with various channel platforms and types of content to understand how key opinion leaders prefer to interact with the company. Therefore, companies need to set up the right environment within the initiative for collaborative experimentation: for example, by placing the right people from IT, business compliance, and outside partners in a “war room” to run fast test-and-learn cycles. If results are positive — for example, patient awareness of a disease and an increase in a particular drug — efforts can be increased. Technology prototypes can become business solutions, formalizing and integrating new ways of working into business processes.
Develop the organization for new business models – To begin with, digital talent may be scarce, but a digital center of excellence can help bring together what capabilities exist, concentrate them into a critical mass, and avoid duplication of resources across commercial and R&D. It can also manage the portfolio of digital partnerships, ring-fence digital initiatives funding, and market-wide codify and export pilot learning. In this new world, to be able to manage faster experimentation cycles while still managing the legacy estate for cost and reliability, it will be vital that IT develops. This should result in a two-speed IT function,3 where “fast domains” operate with different skills, principles of architecture, budgeting, and cycles of planning to those in “legacy domains” that remain focused on business resource planning and traditional business applications.