In Fundraising Tips, Partners

Customer-Centric Approach Leads to Digital Health Venture Success

Written by and shared with permission of: Mighty Capital Partner, Johannon Olson Customer-Centric Approach Leads to Digital Health Venture Success The Playing Field Has Changed The room is silent and everyone is staring forward, expecting a harried salesman who last slept on a cross-country Southwest flight to deliver a product pitch that will finally solve all their problems, no matter how severe and convoluted. The tension in the air is palpable as he pulls up the trusty deck honed by hours of googling and linkedin research on this particular lead. After extensive fumbling with the AV system, he’s shocked to see that the opening slide has another hospital’s logo on it and the entire presentation is in their color scheme. He must have overlooked that detail on his final edits. Already, the audience’s phones are out and eighty percent of the people in the room are beginning to wonder what they’re going to do for dinner tonight. As a battle-tested salesman, he knows the odds are stacked against him…Every day, this and similar scenarios play out in decision-making meetings across healthcare. For a select few, this is the final step in a months-long process that has set up the sale for almost guaranteed success, even if the presentation’s font wasn’t an exact color match to their customers’ brand. Today, we’ll explore three strategies that lead to healthcare sales “wins” and point out how we can tell if the teams we meet in our screenings have what it takes to deploy them. Three Business behaviors Twenty years of managing sales processes from the viewpoint of a decision-maker inside healthcare led to the identification of three empathetic business behaviors or practices have led to sales success in the companies that deployed them skillfully. In fact, honing one to perfection can make the difference, moving the process forward when it would have stopped abruptly based on a sales pitch alone. Please note that these are in addition to a well-tuned sales system, with CRM, budgets for splashy product launches and all the other necessities of B2B sales. Arbitrage Clarity of message related to how a company helps the customer work better, faster and cheaper are critical to sales and ongoing engagement. In healthcare, this generally translates to improving patient outcomes, reducing barriers to receiving the care their patients need and reducing the cost to do so. Key areas where software can contribute to improving outcomes are ensuring the data presented is actionable (insights versus data), the interface is easy to use and multiple information sources are all available on one platform and/or log in. Removing barriers to care often boils down to saving time. Eliminating wasted actions, rework and procedures can often be achieved by making real time-data available everywhere, including (two-factor-authentication secured) personal mobile devices. It is surprising how many care-related reports currently take twenty-four hours (or weeks, months) to be made available to operations personnel and providers -then access is usually limited to specific kiosks within the care areas. One of the most effective ways to reduce costs in healthcare is by improving patient care outcomes, especially avoiding time in the hospital where there are a lot of sick people, bad bugs and overstretched caregivers. This can often be achieved by increasing timely access to care via efficient flow of patients through the hospital. While easier said than done, health record data contains many clues to help solve this puzzle and incumbents have been slow to support this type of function, leaving significant opportunity on the table for startups. Lastly, software built to allow self-management by the end user or a healthcare employed administrator has the dual benefit of allowing real time changes to be made while the company’s representatives are free to focus on other work, including new sales, distribution and feature development. Stories Telling the customers’ stories effectively using the listening, meeting and focusing rubric positions the company to gain important perspective and form the “value of the product/solution” conversation from an empathetic position.   Listening to customers allows the sales team to gain valuable perspective. A counterintuitive but effective approach is to avoid the classic “pitch” while mirroring their thoughts and concerns throughout the conversation.  Also important is having similarly-focused discussions at multiple levels of the organization to draw out parts of the problem (and potential solutions) that may not be visible from one group’s viewpoint. Meeting in the work area, on their terms, for conversations is another unique method to gather stories and facts in the hectic healthcare environment. Aiming for on-on-one conversations creates to opportunity for open communication - cafeteria and outdoor gathering areas can be very successful meeting areas, even if a little unorthodox. As the founders or sales team learn more about the target healthcare stakeholders and focus their messaging, they become uniquely positioned to address their pain, using data to back it up and build out a cohesive version of the internal landscape and the current and future opportunities it contains. At Wharton, Dan Pink and Adam grant taught us about attunement and perspective seeking. They called it “the new ABCs of selling new ideas” — attunement, buoyancy and clarity. A) Attunement Perspective seeking/taking and curating. How do you understand someone else’s perspective and tune into their way of thinking? B) Buoyancy Sales people in general are very resilient and rise back up after a defeat - and then C) Clarity Important for sales, leaders and even business school students. We get a lot of information, so accessing information doesn’t give you much of an advantage. What matters more is being able to curate the information, filter the information, make sense of it and detect patterns in the information — and not only through data analytics and things like that, but also being able to synthesize information on your own. Big idea almost never mirrors any one person’s perspective, yet most are responsive to it! Leverage Creating and sustaining systems to support deploying at scale is the final thought. “Creating a movement” that values and empowers internal stakeholders creates community. When the process of deploying and selling into other areas of the target institutions is internally led (word of mouth), while supported by the company, it creates a high performance sales engine that is sustainable and scales with less pressure on the sales and support team. Being embedded in their work as a critical tool also makes it impossible for the customers to imagine a world without the tools the company provides. It also puts the vendor in a position of driving and defining the role of solution and it’s own support team members (avoiding the “Consultant with a Saas” trap) as well the opportunities they choose to address. Winners and Losers As complexity and costs continue to spiral out of control in healthcare, the potential to integrate technology and systems that have proven to widely benefit other industries has gone unrealized. This is beginning to change. Carla Small, director of innovation at Boston Children’s Hospital, told an interviewer that innovation is necessary all the time in hospitals, but often there is no vehicle to enable it to happen. “In our case, clinicians are innovative in pediatrics because they are having to do workarounds. Historically the enterprise of an academic medical center is not an agile environment for pushing these things out, so people get frustrated,” she said. “Institutions are starting to see success with startups, as we have. Some of our digital health initiatives have turned out to be revenue generators for the institution. Sitting on know-how and not doing anything with it just doesn’t make sense.” We are beginning to see a change in how health systems treat startups and their promise is finally being realized as focused, niche solutions make measurable improvements possible. In order to do this well, these companies need to develop empathetic relationships with and listen to their current and potential customers, using what they learn to guide them to useful solutions and sustainable processes. This will allow them to grow as they develop their products, distribute efficiently and support and iterate.