Medical device manufacturers seeking to capitalize the most on post-pandemic growth should undergo the same digital transformations that have swept through other industries in recent years.
These manufacturers encountered a lull as the number of elective procedures dropped during the pandemic. Fortunately, however, they are regaining their momentum. The total market in medical devices is expected to more than double to $700 billion by the end of the decade, according to GlobalData.
But medical device manufacturers can’t assume they can return to pre-pandemic business as usual. As the effects of the pandemic ripple through healthcare and the broader economy, more turbulence seems inevitable—the implications of GE and Johnson & Johnson splitting off their healthcare businesses come to mind, for example.
With the likelihood of expansion as well as disruption in mind, some questions are worth asking. First, is your company presently optimized for growth or agility? If the answer is growth, which certainly would have appeared like a wise approach at the beginning of 2020, how can you improve your change management to deal with more uncertainty in the future? If the answer is agility, which medical device manufacturers now know is extremely helpful when encountering disruption, have you optimized to maintain growth?
In truth, medical device manufacturers don’t necessarily need to make a choice between the two. Instead, they can use new, cloud-based unified e-commerce platforms that seamlessly integrate certification and compliance, testing and payment systems with supply management, document management, warehouse staffing, delivery, maintenance, and end-of-life services.
Unified e-commerce tools and expertise have demonstrated the ability not only to quickly assess the current market and handle end-to-end services but also to plan and shift according to the latent uncertainties in many predictable scenarios.
Traditional commerce and order management planning and forecasting assume that your business and its environment will continue to trend similar to the past. Things will change, but within certain bounded expectations. Uncertainty planning, in contrast, is preparing for a variety of unforeseen economic shifts that may impact supply and demand—expecting Black Swans, in other words.
That can come off as wizardry. But really, it’s just better scenario planning and risk management. What scenarios are possible? What scenarios are you ignoring despite their potential because they might seem cataclysmic? What if the bankruptcies cascading through healthcare grow worse? What if a more lethal COVID-19 variant emerges? Planned and well-exercised agility are necessary to answer these questions.
Good strategic modelling allows for agile profitability and cost management and identifies your most and least profitable products. Solutions that offer data visualization help with this process. Narrative reporting helps, too, and often explains whether budget forecasts were accurate or not. Automation, meanwhile, makes sure the whole process occurs right alongside ongoing business operations.
Scenario planning, profitability modelling, revenue analysis, cost management, and cash flow analysis and reporting are all possible with unified e-commerce. A final critical element, however, is being able to carry out these tasks at scale and in real time. As the pandemic illustrated, medical device companies can’t wait weeks into the next period to find out what happened in the last one. The world can change too rapidly.
Using data in real-time, and with the help of automation, unified e-commerce platforms in the medical device manufacturing space can integrate sophisticated scenario planning with strategic forecasting. Using unified e-commerce tools, finance and accounting executives are no longer backward-looking chroniclers of what happened in the past. Instead, budgets are vehicles to prompt departments to commit to different paths.
Their work doesn’t stop when they hand over a profit-and-loss statement. That’s when their job now starts. That means cloud-based solutions must be configured to support them as they take on these more-significant challenges.
These higher-level skills are essential for manufacturers that want to lead in the digital restart that is emerging in the medical device space. With unified e-commerce, companies will not only be keeping pace in a stable economic climate, but they will also gain the capacity to proactively plan and adapt when turbulence occurs.
There is enough of the pre-2020 mindset to go around. Companies that aren’t looking forward will struggle with a lack of integrated reporting; long, manual data consolidation processes; and the inability to conduct “if/then” scenarios in a world of unknowns.
Organizations that can think faster and translate that into adroit steering will increasingly define the leadership of their respective industries. Medical device manufacturers are no different. The companies that make changes to better support customers and outpace their competitors, without waiting for a return to supposed normality, will gain the most from future growth.