Sikich recently collaborated with Pharmaceutical Executive Magazine on a survey of life sciences companies to better understand how these organizations take advantage of ERP systems and what their goals and challenges are in planning and using technology. Close to half of the survey respondents were at the commercialization stage and almost a quarter were performing phase II or III clinical trials. In this article and several other posts, we showcase the most interesting survey findings and comment on them from our perspective as a technology consultancy that serves many life sciences clients. This particular post focuses upon the technology that helps life sciences companies facilitate growth.
A foundation for growth for life sciences
Strategic partnerships, expanding into new markets and territories, and growing the portfolio are the three most significant growth facilitators mentioned by survey respondents. We often help life sciences organizations pursue growth along these lines through our industry-optimized ERP technology solution built on NetSuite, Sikich SuiteSuccess for Life Sciences.
For many U.S.-based life sciences companies, the most promising new markets are in other parts of the world. They may decide to commercialize outside of North America to take advantage of tax incentives or favorable business conditions. With the OneWorld capabilities in NetSuite, they can grow, manage, and rapidly expand global operations.
It takes Sikich consultants between only two and four weeks to add a business entity within an existing NetSuite environment to accommodate the international subsidiaries of U.S. companies. Clients then can manage their operations in multiple countries within the same instance of NetSuite, including multiple accounting standards and currencies. Based on our experience, accomplishing this with NetSuite is much faster and less resource-intensive than it would be with tier-one or other mid-market software.
Partnerships in play
Among the most important strategic relationships we find in the life sciences industry are those between fast-growing life sciences companies and incubators. Often, we meet the incubator clients first and perform an implementation of SuiteSuccess for Life Sciences in integration with Coupa Business Spend Management software. Within this instance of SuiteSuccess, we create the legal entities for the incipient life sciences companies that are renting office or lab space and using business services provided by the incubator. A portion of the life sciences firms’ monthly payment to the incubator would account for their access to SuiteSuccess and any software that integrates with it. We configure business roles and security protocols so that only authorized users from a particular tenant company can access their software tools. As companies evolve, want to take control of their business journey, and are ready to leave this shared environment, we transfer their data, roles, and processes into their own instance of SuiteSuccess for Life Sciences. In doing so, we follow a standardized process of just a few weeks.
This evolutionary approach benefits all parties involved. For early-stage life sciences companies, using modern cloud ERP technology provides greater enablement, scalability, and security than the commonly used QuickBooks and similar software tools. It also helps them prepare for an equity event like going public, a special purpose acquisition company (SPAC) transaction, or even a sale to a pharmaceutical company. Well-managed financial records, presented transparently, are likely to strengthen the confidence and value estimations of stakeholders and auditors. Incubators, on the other hand, can gain a competitive distinction with life sciences innovators when they provide powerful technology that is designed for their business and which can grow with them.
Addressing talent shortages by enabling great user experiences
Talent shortage has long been part of the life sciences business climate. Many life sciences professionals can advance their careers by joining different employers, and the “great resignation” has intensified the industry’s competition for talent. Globally, close to 86 percent of life sciences HR managers in a survey state that talent shortage is one of the key issues their organizations face, and 75 percent say that their companies are losing the important skills that enable them to be agile and remain adaptable.
In the U.S., 72 percent of life sciences employers see a decrease in the volume of candidates applying for open jobs, and 70 percent say that it takes longer than in the previous year to fill positions. 60 percent of industry professionals are actively looking for other jobs and 21 percent do so casually. To-be-expected, significant turnover may not be easy to accommodate for the 73 percent of life sciences employers that already find it challenging to recruit talent because their compensation offers are too low. In our survey, respondents stated that staffing and skills shortages were the most significant factors risking growth.
In working with life sciences clients, we find that it’s particularly challenging for them to recruit qualified finance managers. Financial professionals who can help a company manage rapid growth and prepare for such major milestones as going public can be hard to find and will often be able to weigh multiple employment options before deciding for one. IT staffing can also be difficult for life sciences companies as businesses compete for talented individuals who understand the modern cloud and the industry’s specific data management and analytics requirements.
Targeting greater results from talent
When life sciences companies outgrow QuickBooks and other software tools they adopted in their early days, we help them streamline their business processes as they get ready for an implementation of SuiteSuccess for Life Sciences. Almost always, we can eliminate manual steps and use automated workflows to standardize and simplify processes. We also assist those businesses in making organizational knowledge and best-practice expertise available to employees. These changes help them accomplish more with fewer resources and reduce the dependency on experts. With SuiteSuccess for Life Sciences and other technologies in the cloud, it can also become easier for life sciences companies to draw on a larger talent pool and enable team members to be effective from anywhere as they do their jobs and collaborate with colleagues on a cloud platform.
Some life sciences companies are not interested in using their hard-won talent for managing technology or back-office processes. They prefer to outsource those functions to experts and limit their actual hiring to mission-critical roles. For these clients, Sikich can provide managed services and enable them to run lean.
A clear path to well-timed transformation
An ERP system like SuiteSuccess for Life Sciences can help life sciences companies secure funding, comply with regulatory mandates, and drive digital transformation, all of which were other growth risk factors named in the survey. They can rely on extensive Sikich industry, technical, and regulatory expertise to support all three of these areas. Well-managed, transparent and compliant financials typically make a huge difference for potential investors who consider funding a company. When they feel they can trust both the company’s data and reporting as well as the understanding of its leadership in how to achieve growth, they can be more confident in making a positive decision.
Digital transformation is not always a meaningful consideration for the life sciences companies collaborating with Sikich. We often meet them at an early stage and work with them as they move toward phase III clinical trials and anticipate commercialization. They rely on empowerment through our expertise, industry-best practices, and technologies like SuiteSuccess to grow at the right pace, ensure compliance, and operate efficiently.
Opportunities for digital transformation may not be compelling and actionable for life sciences companies until they’ve seen first-hand what technology can help them achieve. Then, when they know that they can rely on SuiteSuccess for Life Sciences and other tools to control their inventory, maintain compliance bolstered by software validation, and manage relationships with third-party logistics (3PL) providers and contract manufacturing organizations (CMO)—that’s when they may be ready to explore digital transformation strategies. With powerful, scalable, secure cloud technology, we have built a foundation that can change with life sciences companies as they grow. When they’re ready, we collaborate with them on road-mapping and driving digital transformations on that platform.
To gain more insight and explore technology opportunities for your life sciences organization to facilitate growth, you can: