The IT explosion is beginning to have a profound impact on the skills demanded of sales people.  It is the responsibility of alert professionals to anticipate and prepare for the approaching paradigm shift in sales.

In the past, sales people were the only conduit a customer had for company product information. The sales person’s control of information created the client’s expectations for a valued sales rep–an affable personality combined with thorough product knowledge.

In the scenario, in which reps control information, when clients become aware of an internal problem or challenge they rely on the sales rep to educate and direct them toward the solutions.  However, the massive increase in publicly available information is beginning to have a dramatic impact on what is required to be a valued sales rep.

In the age of the Internet, reps no longer control product and industry information.  Today easy information access allows clients to do their own problem solving research eliminating the need for the sales person to do it. Armed with preliminary knowledge, they simply contact companies for price quotes and presentations.

This expansion of a client’s ability to research and find solutions is is changingthe requirements that will be demanded for the next generation of sales professional.  The old formula of simply memorizing features and benefits and delivering them with personal charm will not be enough for a 21st century rep to be handsomely rewarded–or even just sustainably employed.

In this changing climate, reps must not only solve problems, but become experts at identifying these problems before the client is even aware of them. The new professional sales rep must possess critical thinking skills to identify institutional problems, then motivate the client to solve the problem. The outgoing personality–charming and charismatic–that was once a must-have has been downgraded to a nice-to-have and the valued rep of the future must master the following:

(1) creative and critical thinking;
(2) corporate balance sheet analysis;
(3) persuasive communication (one-on-one and group); and
(4) the art of negotiation

The medical device industry is a great example for illustrating this impending paradigm shift.  While reps in medical devices are still looked to and valued for their product information, the economics of the industry is forcing the rapid adoption of the shift described above.  The entire continuum of care in medical devices–hospitals, patients, payers (i.e., insurance companies), manufacturers, and the government–is aggressively looking to lower costs.

This mandate to lower costs will force each link in this continuum to solve its own problems instead of relying on the opinion of the device rep.  Much of this change is already in motion, as proven by manufacturers bundling products and services in order to increase revenue and market share within a particular healthcare institution.

This is a win for both the manufacturer and hospital as institution’s exclusive commitment to contract, allows the manufacturer to lower the institution’s average sales price (ASP).  In the exclusive bundling scenario, the healthcare institution lowers its equipment or implant costs substantially and the manufacturer increases revenue, gains market share, and eliminates its competition.  It is critical to note that the bundling strategy effectively marginalizes and by passes the sales rep because exclusivity deal are done at executive levels–not rep levels.

While not all hospitals enter exclusivity deals, they do enter alternative arrangements that are not favorable to old-school sales reps. Seeking to cut costs, institutions unwilling to do exclusive deals have done one or more of the following:

(1) hired 3rd party consultants to make manufacturer selections and negotiate price points;
(2) issued RFP’s that contain a product price request with “no rep coverage;” and
(3) joined consolidated healthcare buying groups that have previous negotiated vendor pricing discounts.

In each instance, the role of the sales rep is circumvented by the ability of others to extract and apply the information that the rep once solely owned.  Once again the savvy clients have discovered the problems and solutions on their own and are now able to solve these problems without the added cost of a sales rep.  Change is coming–in fact, it is already here–and the days of charismatic brochure wielding product pitchers are rapidly fading.

Unfortunately, the majority of medical device reps will become bewildered victims of this paradigm shift instead of proactively preparing to excel in it.  The last two decades have warped the once driven medical device sales entrepreneur into a glorified envelope stuffer–once creative and nimble, the rep now follows the doltish algorithmic formula: the more envelopes stuffed the more money made.  The relative ease with which medical device reps used to experience financial success created a medical device mentality that directly equates opening implants in the O.R. to money earned.

Each implant opened is correlated to commission dollars earned by the rep.  It is this one-to-one mentality, like that of an envelope stuffer, that impedes the inspired drive needed for a rep to properly prepare for this paradigm shift.

The narrowly focused device rep only values activity when it produces commission dollars–an immediate exchange.  Once this mindset permeates a rep, personal development is impossible.  The activities that promote personal development are usually investments with no immediate or guaranteed return.  The commission-obsessed device rep cannot stomach long-term sacrifice of investment in personal development.  For this reason, the majority of medical device reps–i.e., similar to alcoholics who must hit bottom before seeking help–will become victims of this paradigm shift and only begin to change after they have lost their jobs.

To build a sustainable sales career, sales reps must first accept the pending changes to their professional profiles: charisma and product-pitching will not provide sustainable employment.  Professional sales will be more complex and creative than ever before and the valued reps of tomorrow will possess the following:
(1) the skill to alert clients to perceived organizational problems;
(2) the credibility to get clients to expand their viewpoints; and
(3) the knowledge to persuade clients to embrace and follow through on the rep’s insightful discovery.

The financial rewards for competent sales professionals will be more lucrative than ever but these rewards will be reaped only by the elite.