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A Seat at the Strategy TableAmidst the ebbs and flows of our national debate over healthcare reform there is one certainty. The business of making and selling health technology products as we have known it is a thing of the past. Our reform mandate for "better care at lower cost" necessitates a new approach to strategy development and execution, up to the complexities of these times.
We have already seen several signs that old formulas for success aren’t going to work that well anymore. One of the most significant is the growing complexity of the buying decision for healthcare products. What was once the sole domain of the physician has now become a decision reflecting the various efficacy and economic needs of payers, hospitals, regulators and a more involved patient consumer.
Business indicators also portend a need for new strategy. Revenue and market share growth have stagnated for most healthcare product manufacturers, as an increasing number of new product developments seem to at best just retain share. Margins continue to erode as the price-setting power shifts from manufacturers to payers. Despite these business challenges to the industry’s traditional leaders the market continues to attract new competitors, lured by the financial potential of the largest component of our national GDP.
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