The Rx for Success: Performance Management of Pharmaceutical District Managers – From a Lightweight to an Icon: Successful Sales Management (Part 8)

The Rx for Success: Performance Management of Pharmaceutical District Managers – From a Lightweight to an Icon: Successful Pharma Sales Management (Part 8)

Preamble

This is a true story, shared for educational purposes. To protect the privacy of those involved, names and locations have been changed and Indianized.

Yashwant Mallya, MD & CEO of Sirlus Pharmaceutical Company is interviewing Vilas Prabhu for the role of Director (Marketing and Sales). However, they have differing views on performance management of District Managers (first-line sales managers) and how their performance should be evaluated.

Vilas believes that marketing and sales should work closely together, while Yashwant prefers to keep them in separate silos. Yashwant wants District Managers to be judged purely on sales numbers, whereas Vilas advocates for a broader approach—measuring their success through three parameters - sales, people development and brand-building efforts.

This fundamental disagreement is making Yashwant reconsider Vilas’ suitability for the role. Will this difference in perspective cost Vilas the opportunity, or will it spark a deeper discussion on the future of leadership of Sirlus Pharmaceutical Company?

Read on…

Interview Conversation: Yashwant Mallya & Vilas Prabhu

“Vilas,” Yashwant Mallya began, his tone clipped, “your experience is impressive, but I’m not entirely convinced you’re the right fit for Sirlus. Our District Managers are the backbone of our sales force. Their performance hinges on one metric: sales. You seem to want to complicate things with marketing metrics, brand building and people development. Frankly, I don’t see the connection. Sales are tangible; brand building is… nebulous. And people development? It’s indistinct, intangible, and fuzzy. I’m concerned about the high attrition rate in the pharmaceutical industry, as it seems our training and development efforts can only benefit our competitors and other companies who pull them.”

“Let’s get straight to the point Vilas. At Sirlus Pharmaceuticals, we believe in clear accountability. Sales teams sell, and marketing teams create strategies. Sales performance is measured by numbers. A District Manager’s primary role is to drive sales. That’s my non-negotiable view.”

After a long pause, Vilas leaned forward, his expression calm but earnest. “I appreciate your viewpoint and understand your concern Yashwant. I believe that a District Manager’s role extends beyond just sales numbers.? Sales numbers are crucial, absolutely. But focusing solely on them is like judging a tree by its fruit without considering the roots. A healthy tree, one that consistently produces abundant fruit, requires strong roots, consistent nourishment, and protection from disease. In our context, those roots are brand building and effective strategy execution."

Yashwant raised an eyebrow. "Metaphors are all well and good, Vilas, but I deal in concrete results. Show me how brand building and people development translates into increased sales. At the end of the day, we need revenue. If we don’t hit targets, all the brand-building efforts mean little.”

Vilas: “I fully agree that revenue is crucial. But let’s consider this—sales numbers are a lagging indicator. They show results but don’t tell us what led to those results. If we only focus on numbers, we risk missing the factors that drive sustainable growth. It's not a direct, immediate correlation, Yashwant.”

After another long pause, Vilas further explained. "There are other factors to consider. And that’s the crucial role of our District Managers."

Yashwant: “Factors like what?”

Vilas: “Doctor engagement, prescription depth, brand recall, message retention—these are just a few. A District Manager isn’t just a sales driver; he is also a brand strategy execution specialist. If marketing crafts a great strategy but it isn’t executed well, sales will suffer. And if sales teams operate in isolation, they may push volumes but fail to build long-term brand equity.”

Yashwant: “But why complicate things? If a District Manager meets his sales target, he is doing his job.”

Vilas: "Think of it this way Yashwant: our Medical Representatives and District Managers who are their leaders aren't just prescription generators or mere order takers from retail pharmacies and stockists; they're our corporate brand ambassadors. They're the face of Sirlus in their territories. If they're only incentivized to push volume, they might resort to tactics that, while boosting short-term sales, could damage the corporate brand image in the long run. For instance, they may resort to discounting heavily or focus on only the fastest-moving products, neglecting the newer, potentially high-growth ones."

“Yashwant, let me give an example,” said Vilas: “Suppose two District Managers - Aditya and Karan - both meet their targets. Aditya understands the overall brand strategy. He not only achieves sales targets but also focuses on educating doctors about the benefits of our newer products, building relationships with key opinion leaders, and ensuring that marketing materials are effectively distributed and utilized. Aditya achieves targets by deepening doctor engagement and expanding brand penetration. Moreover, Aditya has dedicated himself to the professional development of Medical Representatives. Each joint-field work with Aditya transforms into a learning and development opportunity for the Medical Representatives on his team. It’s zero attrition in his team after he took charge. People wait for him to join for joint field work.”

“On the other hand, Karan focuses solely on hitting sales targets, pushing existing products, perhaps even resorting to aggressive tactics. He achieves it through heavy discounting and stock pushing. On paper, both look successful. The attrition rate in Karans’ team is terrible. Just imagine the hidden costs of high attrition. Imagine the costs of recruitment and training; the loss of goodwill with doctors, retail pharmacies and more. . Who do you think is securing the company’s future?”

Yashwant: “Theoretically, Aditya is building doctor relationships, brand equity and human strength”. Yashwant paused, considering this. "But how do we measure that? How do we quantify brand consciousness?"

Vilas continued: "That's where the integrated approach comes in. With the help of our HRD, we can develop key performance indicators (KPIs) that reflect all three - sales performance, brand-building activities and people development actions. For example, we can track the number of new doctors prescribing our products, the feedback we receive from them, the effective utilization of marketing collateral, and even the District Manager's adherence to our brand guidelines. Skills and competency tools, retention rates, behavioral changes and the quality of inputs during joint-field work can be tracked. These metrics, combined with sales figures, provide a holistic view of a District Manager’s performance. AI and generative AI can make it so easy and seamless."

Vilas continued:? “And if we don’t measure and incentivize that, we risk rewarding the wrong behaviors”.

“Coming to the next part of your question, investing in people development offers substantial benefits to Sirlus. It enhances people’s skills, which leads to increased productivity and innovation. Furthermore, it fosters a culture of continuous improvement and learning, contributing to higher job satisfaction and employee morale. As people feel valued and supported, their loyalty and retention rates improve, reducing turnover costs. Moreover, well-developed people are better equipped to meet customer needs, enhancing the reputation and competitiveness of Sirlus in the market. Sirlus can attract better and superior talent during expansion times. Overall, investing in people development is a strategic move that drives organizational growth and success”.

Yashwant: “So, you’re saying we should look beyond numbers to evaluate a District Manager’s performance?”

Vilas Prabhu: “Yes, sales numbers tell us what happened. But brand-building activities, strategy execution and right people retention tell us why it happened and whether it’s sustainable. Let’s consider four key performance pillars:

1. Sales Achievement: Yes, this remains fundamental.
2. Brand Strategy Execution: Are District Managers ensuring that brand strategies get effectively implemented? Are they tracking how doctors perceive our brands?
3. Brand-Building Activities: Are they helping create brand loyalty and differentiation? Are they ensuring continuous medical engagement beyond just pushing sales?
4. People Development: Improves productivity, there is better quality of work and demonstrates your commitment to foster a sense of loyalty. This results into better retention

Yashwant: “I see your point. But measuring these aspects—how would you quantify them?”

Vilas: “We can track parameters like prescription trends, doctor feedback, brand recall studies, and engagement effectiveness. Marketing and sales should not be separate silos; they should work in tandem to build sustainable business. AI tools are available.”

Yashwant: “Hmm… so, you’re advocating a balanced approach—where sales numbers are critical, but we also ensure execution quality and brand-building efforts are recognized?”

Vilas: Precisely. If we adopt this model, we don’t just chase short-term sales; we build long-term brand success.

Yashwant: I must admit, this is a fresh perspective. You’ve given me something to think about.

Vilas: Thank you, Yashwant. It’s about future-proofing Sirlus brands and Sirlus Pharmaceutical Company while delivering sales today.

Yashwant leaned back in his chair, his initial resistance visibly softening. "So, you're proposing a system where District Managers performance is managed not just on what they sell, but also on how they contribute to building the brand?"

“Exactly," Vilas confirmed. "It's about fostering a culture where sales and marketing are not siloed functions but rather two sides of the same coin, working together to achieve common goals. This integrated approach will not only enhance the performance of our District Managers but also strengthen the Sirlus brand, leading to sustained growth and market leadership."

Yashwant (smiling): “I appreciate the logic. Welcome aboard Sirlus Pharmaceutical Company, Vilas. You are our new Director (Marketing & Sales).”

Vilas Prabhu looked surprised: “Thank you, Yashwant. I look forward to driving sales and brand strength and people development together in Sirlus Pharmaceutical Company.”

The Lessons from This Interview

We must understand the District Manager's role to effectively manage their performance. Simply put, a District Managers main role is to develop people in his team and develop brands in his district. And that’s how he should be evaluated.

It’s an on-going process where the District Manager works with each Medical Representative on his team to help him succeed and grow in his role. This includes having regular conversations about what's going well, what could be better, and what support they need to improve. The seven steps of Performance Management include:

1. Setting clear goals with each Medical Representative

2. Watching how they're doing in their day-to-day work

3. Giving them regular feedback and advice

4. Helping them improve their skills

5. Recognizing when they do well

6. Addressing problems when they're struggling

7. Reviewing their overall progress regularly

The District Manager ensures every Medical Representative remains motivated, adheres to the appropriate brand strategies and corporate strategies, and works efficiently to drive business success by increasing prescription demand.

The District Manager plays a crucial role in both developing people and building strong brands. Let us delve into the activities required for both:

(A) Developing People in the District

1.??? Coaching & Field Training

-???????? Conduct Joint Fieldwork (JFW) with Medical Representatives to observe, guide, and improve their selling skills.

-???????? Demonstrate effective doctor engagement techniques.

-???????? Provide real-time feedback after sales calls.

2.??? Skill Development & Knowledge Enhancement

-???????? Ensure the Medical Representatives have in-depth knowledge of product benefits, competitor insights, and objection-handling skills.

-???????? Conduct weekly training sessions on medical knowledge, sales techniques, and territory Medical Representatives to continuously learn and improve.

3.??? Setting Clear Goals & Expectations

-???????? Define individual sales targets for Medical Representatives and align them with business objectives.

-???????? Set clear performance metrics, such as doctor coverage, call quality, and prescription generation.

-???????? Track and review each MR’s progress regularly.

4.??? Motivation & Team Building

-???????? Recognize and reward top performers to boost morale.

-???????? Address challenges faced by underperforming MRs with supportive coaching.

-???????? Foster a team spirit by encouraging collaboration and celebrating achievements.

5.??? Career Development & Succession Planning

-???????? Identify high-potential Medical Representatives and prepare them for future leadership roles.

-???????? Provide guidance on career growth within the company.

-???????? Encourage skill development beyond sales, such as analytical thinking and market intelligence.

(B) Developing Brands in the District

1.??? Driving Prescription Growth

-???????? Ensure the sales team effectively communicates brand benefits to doctors.

-???????? Implement scientific engagement strategies like CMEs (Continuing Medical Education) and clinical meetings.

-???????? Monitor prescription trends and guide MRs to focus on high-potential doctors.

2.??? Implementing Brand Strategies Locally

-???????? Ensure that brand campaigns, promotional inputs, and marketing messages reach the right doctors.

-???????? Adapt company strategies to fit local market needs while maintaining consistency with national goals.

3.??? Expanding Market Coverage

-???????? Identify and develop new doctors, hospitals, and clinics in the district.

-???????? Ensure optimal doctor coverage and visit frequency by Medical Representatives.

-???????? Strengthen relationships with distributors and retail pharmacies.

4.????? Competitive Analysis & Market Intelligence

-???????? Keep track of competitor brands, their strategies, and prescription shifts.

-???????? Provide feedback to the marketing team on field challenges and new opportunities.

-???????? Recommend localized strategies to counter competition effectively.

5.??? Ensuring Physical Availability & Mental Availability

-???????? Ensure the brand is always available at stockists and retail pharmacies.

-???????? Work with distributors to prevent stock outs and ensure smooth supply.

-???????? Making your brand mentally available to a doctor; by offering relevant and credible information; and reinforcing key messages.

Conclusion

A successful District Manager balances people development with brand growth and sales growth via prescriptions. By building a skilled, motivated sales team and executing strong brand strategies, they create long-term success for both the team and the company. That's how his performance can be evaluated.

The District Manager achieves this balance by setting clear goals for each team member and providing regular coaching and feedback.

They identify training needs and create development plans that help Medical Representatives grow their skills and advance their careers. At the same time, they closely monitor market trends and competition to spot opportunities for brand growth.

They work with their team to execute brand strategies that increase prescription numbers while maintaining strong relationships with doctors. By tracking key performance indicators like prescription volumes, market share, and team turnover rates, senior management can assess how well the District Manager is performing in all aspects of their role.

Success in this position requires excellent communication skills, strategic thinking, and the ability to inspire and lead others.

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