Disrup'ng the Status Quo of Reac've Pricing

Transcription

1 Disrup'ng the Status Quo of Reac've Pricing Jeremy Pifer Director of Pricing

2 Hologic: The Science of Sure Innova've healthcare company with market- leading products for early detec'on and interven'on, with a strong posi'on in women s health. 2 2

3 Science of Sure in Women s Health At 39% of revenue, Breast Health contributes significant por'on of growth. Innova've technology addresses limita'ons of conven'onal mammography. Landmark JAMA Study: Genius mammograms detected 41% more invasive breast cancers while reducing recall rates by 15%. Global breast imaging growing strongly: Publica'on of clinical benefits. High- impact marke'ng campaign. Great opportunity for growth through distributor network. 3 3

4 Steady Growth YoY 4 4

5 But... Leadership Was Aware of Lurking Danger Past results do not guarantee future results. Compe''on of larger conglomerates was not and would not be receding. Frustrated by lack of process and lack of visibility. Customers had be\er visibility. Inefficiencies and lack of governance in pricing were leaving money on the table. Ineffec'veness in bid response was leading to compounded profit losses. 5 5

6 The Pricing Transforma'on Journey Evangelizing for Change Inves'ng in People Establishing Processes Scaling with Systems 6 6

7 Step One: Evangelize the Journey for Change Rally for Inves'ment to Change 7 7

8 Mo'vate, Start, and Show Why Mo'vated by lurking threats of larger compe'tors despite recent growth. Leadership experience with success in pricing elsewhere provided confidence. Began by establishing a commi\ee. Pushed for quick ROI to jus'fy more investment. 8 8

9 Step Two: Bring in the Experts Needed Dedicated Resources to Fight for Value Preserva'on 9 9

10 Expert Jus'fica'on (On Paper) Finance/Treasury Group Pifer Consultancy Pricing Consultant Launched Contracts/ Pricing Group Pricing Consultant 10 10

11 Expert Jus'fica'on (In Reality) Dove right in and joined the price commi\ee on the 2 nd day as a consultant. Plenty of empathy for sales people having worked closely alongside them for years. Could quickly assess the current situa'on and take ac'on. Inserted into the process where he could add value rather than slow down the exis'ng process

12 Ini'al Assessments Lack of Ownership Reac'onary Tac'cs Unclear Objec'ves 12 12

13 Lack of Ownership No broad ownership or accountability for pricing. Na'onal Accounts priced RFPs, however: Neither top- line or bo\om- line focused. Tac'cs were reac'onary. Organiza'on lacked influence. Pricing effec'veness was not measured

14 Reac'onary Tac'cs Lack of underlying price strategy. Scramble to respond to RFP deadlines. Resulted in extreme price variance and (at 'mes) indefensible pricing

15 Unclear Objec'ves Winning every deal? Maximizing revenue? Maximizing margin? Maximizing market share? 15 15

16 Step Three: Establish Process and Accountability Established Process Specific to Hologic s Needs

17 Established the Mission Achieve Defensible Winning Price for Every Customer for Every Product 17 17

18 Pillars for Change Customers had increased nego'a'on leverage with price transparency. Price- focused customers would not pay for differen'ated value. Current metrics reported averages overlooking key details. Enable sales & contract teams with detail to defend pricing. Use micro- segmenta'on to be\er fit customer offerings based on WTP. Pricing- focused metrics uncovered specific improvement opportuni'es

19 Empowering Sales with Informa'on Sales people can bring confidence and insight to nego'a'on with new data access. Now have the capability to proac'vely create op'ons for customers. Enabling informed decision- making and peer- checking

20 Inden'fying A\ributes of Desirable, Target Customers Micro- segmenta'on helps us to: understand the willingness- to- pay (WTP) across our customer base. Iden'fy customers outside of desirable targets. Hospitals Specializing in Women s Care Valued Hologic s Newest, Best Products Other/Non- Specialty Hospitals Transac'onal Customers Looking for the Minimum 20 20

21 With pricing visibility, outliers can be quickly iden'fied to manage price exposure risk

22 Step Four: Systems Technology Needs Automate Accessible Prescrip've Guuidance Con'nuous Improvement Automate and provide consistency in repor'ng Make analy'cs widely accessible Deliver data science- driven prescrip've guidance Provide insight that enable con'nuous improvement 22 22

23 Solu'on Capabili'es: Automa'on Relieved pricing team from manual efforts in repor'ng. Reduced errors in repor'ng while crea'ng consistency. Enabled pricing team to focus on strategic efforts

24 Solu'on Capabili'es: Accessibility Self- serviceable reports. Easy- to- use charts answer the most common ques'ons: What are comparable prices for this customer segment? What discounts have we historically allowed at this IDN or GPO? Accessible to: Marke'ng Finance Na'onal Accounts Teams 24 24

25 Solu'on Capabili'es: Prescrip've Guidance Data science- driven customer micro- segmenta'on Scien'fically- derived willingness- to- pay measurement Real- 'me price guidance supplied to deal reviewers 25 25

26 Solu'on Benefit: Con'nuous Improvement Visibility into Leading Indicators. Can narrow into drivers of growth and decline. Automated repor'ng means that measurement is con'nually available. Con'nued measurement enables con'nued rigor in focus. Makes sustainable growth possible

27 Lessons Learned You re liring the organiza'on as a whole through your pricing processes. Sales people are on your team. Your compe''on is outside the organiza'on

28 Ques'ons? 28 28