Saturday, June 15, 2024

Big Pharma’s Digital Disconnect: Budget Woes Stall Transformation Dreams

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The pharmaceutical industry is facing a digital disconnect, according to a recent report by Graphite Digital. While many pharma companies have ambitious plans for digital transformation, a lack of significant budget increases is putting those plans at risk. The “Disconnected Pharma” report, based on interviews with 100 senior executives across the US and Europe, reveals that limited funding is the biggest obstacle to widespread digital adoption within the industry. Despite this, over half (51%) of the surveyed companies reported plans to increase their digital spending in the coming years. However, the increases are likely to be modest, with only 3% planning significant boosts exceeding 25%.

This discrepancy between ambition and budget allocation highlights a deeper concern: a disconnect between digital teams and upper management. Nearly two-thirds (64%) of respondents indicated a misalignment between the metrics used to track digital projects and the company’s broader strategic goals. Additionally, almost half (47%) stated that digital metrics often prioritize short-term gains over long-term benefits.

Blindfolded Progress: Late KPIs Impede Pharma’s Digital Disconnect Journey

Further hindering progress is the late setting of key performance indicators (KPIs) for digital initiatives. This, reported by 54% of the executives surveyed, can lead to the development of products that ultimately fail to meet patient or clinician needs, resulting in wasted resources.

“Securing additional budget often requires senior leaders and project managers to demonstrably prove the return on investment (ROI) for digital projects,” explains Rob Verheul, CEO of Graphite Digital. “This means finding ways to quantify success in initiatives that may take several years to deliver tangible results.”

Verheul emphasizes the importance of managing expectations for milestones and defining success for long-term digital projects. Achieving buy-in and securing additional funding hinges on creating a clear understanding of the project’s purpose from the outset. This allows for the development of meaningful objectives and KPIs that demonstrate value and ensure all stakeholders are aligned.

Digital Disconnect

Security, Collaboration, and Innovation Top Priorities Despite Funding Hurdles

Regardless of budget size, the study revealed key priorities for how companies plan to utilize their digital funds to move their businesses forward. Data security and privacy emerged as the top priority for nearly 40% of the executives surveyed. Following closely was collaboration across the industry, with 20% expressing a focus on building partnerships. Rounding out the top three priorities, 13% of executives indicated a desire to integrate emerging technologies into their operations.

The findings of the “Disconnected Pharma” report paint a picture of an industry eager to embrace digital transformation, but held back by a lack of significant financial investment and internal alignment. As pharma companies navigate this digital disconnect, addressing measurement discrepancies, setting clear expectations, and prioritizing security and collaboration will be crucial for their success in the years to come.

 

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Resource: Fierce Pharma, May 22, 2024

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