10% Operating Income Improvement for Pharma company in Maturing Markets in Europe

Client Issue

Operating in an highly competitive market, industry leader in Europe needs to recover sustained top line growth rates, financial predictability and enhance declining profitability.

In the new scenario of European economic contraction, a company with over 40 years history in Europe was experiencing frustrating and repeated failures in maintaining the historical growth rates: the very large and diversified product portfolio could not help to improve stagnant growth rates, loss of profitability and the disappointing unpredictability of financial results.

Approach

The client selected 3 geographies where strategic and implementation advisement was required. The project scope and activities were phased in different geographies to avoid overloading the regional management team.

1. The local management team of each geography participated in developing a tailored strategy formulation sessions allowing each team to shape the prioritization and planning methodology to their specific market characteristics.
2. The teams then developed specific objectives and plans that have cascaded focus, accountability and leadership behaviors down throughout the organization ensuring the that strategy was guiding decision making – and was in fact used.
3. Geographies who did not participate in the first set of strategy and implementation activities were extended key tools and methodologies to ensure a common approach to integrate and manage the entire European business portfolio was possible.

Results

• Positive results appeared according to the country phasing: the 2 first geographies have respectively moved from flat and declining sales growth to 5.5% and 18% growth rates.
• Average of 10% operating income improvement across geographies because of prioritized products and channels.
• Entire European region benefited from the above results and from the regional integration of the key planning processes. 
• Entire European region region exceeded budget expectations both in sales and pretax.
• Executive have the strategic decision making tools to manage performance and predictability across product lines.