Digital Adoption Is No More An Option But A Necessity For Pharma Companies
In an exclusive interaction with BW Healthcareworld, Rishabh Bindlish, Managing Director, India Life Sciences and Global Generics Lead, Accenture, spoke about supply chain transformation in pharma and more. Excerpts:
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What are the key challenges being faced by pharma companies over the past year?
Pharma companies in India have been facing several macroeconomic and regulatory challenges in the past few years. Headwinds from distributor consolidation in key export markets, stiff FTS penalties, greater SKU proliferation and heightened regulatory action have posed a diverse set of challenges for the companies.
Last year, the COVID-19 pandemic further tested the resilience of the pharma sector and led to disruptions in the supply chain. A sudden spike in the demand for critical care products saw pharma companies rise to the challenge of ensuring supply continuity and saving lives. While pharma manufacturers were tagged under essential industries, ancillary suppliers such as those of packaging materials were disrupted, thereby impacting their supplies. The pandemic also underscored the dependence of Indian pharma manufacturers on APIs sourced from China, and its susceptibility to disruption in imports. While reforms announced to support MSMEs and offer PLI-linked benefits to API manufacturers are steps in the right direction, but their implementation will be vital for the pharma sector.
How can technology adoption by pharma companies help to minimize disruption?
Digital technologies can not only help pharma companies in delivering high-quality and hyper-personalized services but also in improving business performance and resilience to counter future disruptions. Technologies such as cloud computing, artificial intelligence, robotic process automation, quantum computing, predictive analytics and blockchain can help pharma companies in developing innovative patient-centric products and services that deliver seamless digital experiences. With applied intelligence and data, pharma companies will be better equipped for superior decision-making to improve operational efficiency, business outcomes and customer experience. Deploying cloud solutions can enable pharma companies to operate and compete at unprecedented speed and scale, at a time when the sector is undergoing a massive transformation.
Over the past year, we have witnessed the crucial role played by supply chains of pharma companies in connecting customers and the operations team. Intelligent, customer-centric supply chains powered by digital can help pharma companies create efficient, resilient, and profitable operating models. A digital supply chain can help pharma companies with scenario modelling to simulate and prepare for supply disruptions or volatile demand opportunities, evaluating their operational and financial impact.
What is a customer-centric supply chain and how can it benefit pharma companies?
Today, supply chains are under immense pressure as they are expected to meet complex demands from both customers and businesses. Not only is the need to adapt to the global disruption caused by COVID-19, but also to be agile and responsive in the face of uncertainty and new challenges.
A customer-centric supply chain is the key to unlocking differentiated service offerings that drive revenue growth, improve EBITDA performance, and meet unique customer needs. It can help pharma companies innovate better by using data as an insight generation engine to design new products and services around the customers’ unique needs. It enables companies to connect with external parties for real-time, end-to-end visibility and integrated planning and execution. It can further optimize day-to-day operations using analytics, performance monitoring and continuous innovation. This approach enables a service-oriented operating model that leverages a hybrid workforce to improve customer experience. Additionally, it helps configure the supply chain into an asset-light ecosystem that delivers customer experience in unique microsegments.
Advanced machine learning-based forecasting solutions can help pharma companies take a significant step jump in their forecast accuracy performance, including forecasting for new business, and certain tender opportunities as well. Digital also enables real-time tracking of key parameters such as material receipts, plant dispatches including their performance against plan, and in-transit shipments. Improved supply chain responsiveness and agility help pharma supply chain networks to respond better to external changes, in terms of demand priority or supply of input materials, by integrating planning and scheduling capabilities. With dynamic fulfillment, digital technology can help the logistics management team centrally manage load planning, dock scheduling and load execution for improved operational efficiency.
What are some of the first steps for pharma companies to reimagine their supply chain and make it more customer-centric?
The first step for pharma companies to digitally reimagine their supply chain is to reassess their strategy based on the customer in mind. It is important to personalize the customer experience and understand what the customer values. Next, they need to invest in a robust digital architecture, creating a foundation for collaboration, inside and out. By investing in digital technologies, pharma companies need to turn data into insights that can significantly increase the supply chain’s impact on revenue. They also need to focus on select capabilities such as blockchain, predictive analysis that enhance supply chain agility and foster innovation, while building in security into their operations. Lastly, they need to engage the leadership team to move beyond conversation into true transformation and ensure board-level support while funding supply chain innovation and talent.
What is the outlook for pharma companies in 2021?
Many pharma companies were already taking steps for digital transformation, the COVID-19 pandemic has further accelerated their journey at scale. Digital adoption is no longer an option but a necessity for pharma companies. However, it will be important to see the pace at which they execute to determine success.
Pharma companies looking to generate greater value in 2021 need to focus on adopting emerging technologies with a holistic view, to become truly customer-centric.
In crisis situations such as the COVID-19 pandemic combined with macroeconomic and regulatory risks, supply chain planning and execution of operations need to be tightly integrated to drive business value. Building resilience with a robust scenario-based planning and execution capability will be vital for business continuity and growth.
They need to shift to an intelligent supply chain model and look at data management and governance to make informed decisions. As data-driven organizations, they will need a framework in place for organizing and executing processes and will look to build digital teams, with a combination of strong business engagement, data modeling, platform engineering, and product management skills. Indian pharma companies in particular will look at channeling their digital investments towards an efficient multi-tier inventory planning system to ensure the right product is available throughout all stocking points, right from the manufacturing plant, mother hub and the carrying and forwarding agency (CFA) locations.