Optimizing your gross-to-net (GTN) performance in the life sciences sector can produce added profitability and can stop revenue leakage while increasing productivity for your organization. Although technology undoubtedly plays a significant role in your workflows and processes, it should not be your primary focus when assessing your current GTN situation and identifying areas where improvements can be made.
GTN optimization is not a one-time event; instead, it is an ongoing process that requires continuing attention from key employees inside your corporate structure. The optimization process generally comprises five key activities:
- Assessment of the current GTN situation
- Recognizing cross-functionality within the organization
- Implementing and maintaining effective communications strategies
- Mapping of standard processes to incorporate cross-functionality within the organization
- Adapting current processes to manage future challenges in the industry
The activities work in a manner that comes full circle, from assessing internally at the beginning to assessing externally as the final step. The “loop” of these steps allows organizations to begin again once they have reached the point of external review. These five elements can ensure the most effective optimization of your corporate GTN performance and can provide a solid basis for future growth and profitability.
1. Assessing GTN in Your Organization
Establishing a baseline for your current GTN performance can provide you with added risk management insights that can considerably enhance your potential profitability. Approaching GTN analysis from the risk management perspective allows a greater focus on areas of immediate concern and puts an emphasis on identifying revenue leakage and cost-effectiveness throughout your corporate structure. Ensuring accurate reporting of data is another key concern and should be incorporated into the overall assessment process.
2. Recognizing Cross-Functions within Your Corporate Structure
A key element in GTN optimization is the concept of managing revenue through organic corporate processes. This concept encompasses organizational process management and process governance, two topics that require a thorough understanding of how information flows through your corporate structure and how decision making is handled from the top of the organizational chart all the way to the line employees who make up the bulk of your company's workforce. The interactions between various elements of your corporate structure must be managed effectively and in a disciplined way to ensure that changes to processes and workflows within the organization are communicated clearly and that your company can achieve maximum buy-in from executive-level employees, managers and line staff. By considering your organization as an integrated whole and recognizing the cross-functionality between departments and divisions, you can approach your GTN optimization plans with a greater degree of expertise and strategic acumen.
In the next post of this series, we will explore ways three through five. In the meantime, please download the whitepaper, The Most Common Pitfalls in Quote-to-Cash Business Processes (and How to Avoid Them) for Life Science Organizations, for further detail on how to assess and optimize your GTN business.