In COVID-19 era, pharma sales turn to digital hires, top-ups in R&D, production, distribution
Inspite of COVID-19-linked disruptions, Kamal Karanth, Co-founder, Xpheno, a specialist staffing company believes that the long term prospects for the sector remain intact and could even grow in some product categories.
The irony is that the speed and action in the pharma space, as it races to develop vaccines and medicines against this novel coronavirus, will define the speed of recovery of the population and thereby the recovery of other industries and the economy overall. The pharma sector will have to go through this critical phase while tackling cost and profitability challenges within.
The pharma sector, which accounts for over 2.7 million direct and indirect employees in India, is expected to show a near one-fourth reduction in hiring activity in an already slow headcount growth sector, with a redistribution across functions. Short-term reduction of headcounts in marketing and sales driven by a move to DIGITAL will be countered by top-ups in the R&D function for large players and additions in the production and distribution across most players.
This contraction of almost 50 per cent from previous hiring levels of “feet-on-street armies” of pharma sales personnel is only to be expected, given the movement restrictions that would continue to be in place in the post-COVID era. But the move towards digital marketing will raise “social media noise” bringing its own challenges, predicts Karanth.
Read on for further details on job redistribution, recommended upskilling strategies, the role of HR in this transition and increasing engagement of remote workers and telecommuters in work from home (WFH) arrangements in the sector in the challenging post-COVID era ahead
Pharma is designated as essential, and many companies are working through the COVID-19 pandemic. Will the sector be hiring more or less in FY21?
The conditions that have emerged in the industry due to COVID does not take away the long trail of pains and shortfalls the industry has been going through over the decade. The over 2.7 million direct and indirect employment that the industry offers stares at a mixed bag of situations arising from revised earnings from large players and a potential increase in activity due to a hyperactive healthcare sector to be serviced.
On the hiring front, however, a near one-fourth reduction in hiring activity in an already slow headcount growth sector will have its impact on net additions for the year. The Top 125 pharma companies that account for over 3.2 lakh employees have had additions of only 5000 and 4000 respectively over the last two years. A further reduction in net addition figures or stagnation should be expected for the year.
Given the nature of the industry and its functions, in view of a COVID-linked buoyancy of activities combined with the changing dynamics of servicing, what should be expected is a redistribution of headcounts across the functions. Expected short-term reduction of headcounts in the Marketing and Sales functions will be countered by top-ups in the R&D function for large players and additions in the Production and Distribution functions across most players. The support functions in the pharma space are typically balanced and optimised and hence will not be expected to shed headcounts or have notable additions.
With increased awareness and consciousness arising out of higher risk propensity for certain kinds of chronic patients, the “maintenance” drugs market are likely to see volume traction. This could have an almost 15-20 per cent basket size growth of consumers in this category. Besides, preventive or immunity-boosting OTCs should, in general, expand by about 15-20per cent.
Which functional areas will see increased demand for talent?
Over 36 per cent of headcounts in Top 125 pharma companies sit in the BD, Marketing and Sales function, followed by Operations, Engineering and Quality functions at 24 per cent, Support Functions including Finance, Legal, HR, IT, and others at 22 per cent while R&D is at 15 per cent. A redistribution of headcounts can be expected with a reduction in Sales and Marketing headcounts, as the function gets more digital than ever before.
Movement regulations that healthcare facilities would place in the COVID and post-COVID situation will see reduced sales personnel movement on the field. The newer challenges of R&D on pandemic control drugs and vaccines, followed by the production, QC, and logistic operations around the same will see top-ups to the extent of about 10-12 per cent in the other core functions, leaving the support functions stagnant on their headcounts. The short-term demand for talent will hence be in Digital Marketing, Customer Service, R&D, Clinical Research, Quality, and Operations functions.
Stronger adherence to FDA norms on facilities and audits on these will find incumbents on all such roles or newly created roles, towards a better acceptance in the global context.
Which skills will be more in demand in the post-COVID-19 era, as a guide to employees looking to upskill/upgrade?
In the short-term, spike in talent demand will be in the specialist function domains to go with the focus on R&D, trials and approvals. Apart from the technical skills in these functions, some of the current demand is in domains of Project and Program Management, Product Development, Compliance, Automation & Digital, Data Science & Data Management, QC Analysts, Regulatory Affairs, etc.
Given the nature of skills in this industry, employees looking forward to upskilling and upgrade should look at staying in their verticals and specialising within rather than attempting cross-function or cross-domain skills development. The idea would be to remain relevant in the changing conditions of the industry that will now become more and more ‘Digital First’, with lesser salespeople on the street in the short to mid-term.
What is the role of HR when there is so much uncertainty as well as salary cuts and impending layoffs if the pandemic does not come under control as expected?
The roles of the HR function in the current scenarios range from tactical issues like productivity enhancement to more profound challenges of employee wellness and mental health in the background. If projections are right, we have another 12 to 18 months for a vaccine supported recovery and stabilisation of the market.
The speed and action in the pharma space will define the speed of recovery of the population and thereby the recovery of other industries and the economy overall.
The challenge within pharma will be to go through this critical phase while tackling cost and profitability challenges within. With all-hands-on-deck to manage the pandemic, the focus on other healthcare processes and related regular streams of drugs remains a challenge, and that has impacted the revenues of many players.
HR hence definitely has a task to handle the employee end transitions linked to reduced headcounts, functional redistribution, automation, and digitised optimisation. Apart from competing to identify and onboard specialists skillsets before competition hires them, HR also has the critical task of retaining and protecting the essential skills already within.
Will certain departments like marketing, IT, see some churn as pharma companies lay off staff to hire younger, more tech-savvy talent?
The BD, Sales and Marketing functions that form the lion’s share of the headcount will see the rise in demand for digital talent as the feet-on-street armies will be challenged to stay relevant in the physical restrictions that healthcare facilities will implement. While meeting doctors physically at their cabins would become a luxury for the sales teams, a more significant challenge awaits in reaching them through digital means amidst all the other digital media and social media noise. The pharma industry that has been working at raising its digital curve will do so more acutely now and demand talent that can do the same in the shortest time possible and the highest ROI possible. Yes, a younger, digital workforce can potentially replace the existing ‘feet on street’ sales force.
All workplaces will have to factor in such measures like quarantine, physical distancing. How will this impact hiring trends?
The staggered lifting of lockdown and sequenced restart of commercial activities will be driven by the physical distancing needs and regulations that will come in and expected to remain for a while. Businesses that are social distancing proof and WFH proof will be the first to recover and restart, while the brick-and-mortar companies will reinvent and innovate to catch up.
The physical restrictions that currently are impacting only the interview processes and onboarding decisions will change hiring plans and workforce requirements starting the next quarter. The sheer physical aspect of the low physical density of occupied seats will see traditional 9-to-5 industries trying their hand at shifts to rotate seat occupancy while balancing costs of increased hours of operations. This will impact hiring trends for certain types of talent that are open and available for changed formats of working.
There will also be a push to identify WFH-able roles and seats and hiring remote workers who telecommute to work will open out a whole new talent requirement. Pharma industry’s 80 per cent of the hiring has traditionally been on the sales personnel. That can see a drop of at least 50 per cent in the short term
Will the pharma sector be open to increasing the number of employees who Work From Home? What precautions will they have to take to maintain data confidentiality/security, productivity, team building, etc.?
The pharma sector was earlier among the traditional brick-and-mortar model industries that allotted seats for each employee and put them on shifts to handle volumes by rotating seats. However, the latter half of this decade has seen quite a few roles in the pharma ecosystem being available to engage remote workers and telecommuters on WFH arrangements. Functions like Clinical Research Associates, Medical Writers, Regulatory Affairs Managers, Clinical Data Analysts, Statistical Modellers and Programmers are among the popular remote roles that the industry has come to use.
In the current situation, more pharma players are out to assess the WFH feasibility on more roles. We see roles like Technical Writers, Chemistry Analysts, BD Manager, IT Roles, Payroll and Finance specialists, Reporting Analysts now getting posted for remote working options. The challenge of data security and Intellectual Property protection is definitely set to increase, and pharma companies will look up to the IT Services and Products industries to mimic their Information Security and IP Control systems. Maintaining productivity, employee engagement and team building will see the deployment of more digital initiatives and implementation of agile methodologies of project planning, execution, and progress monitoring. In a nutshell, many of their corporate roles can move into WFH mode and save the real estate cost.
Will the new acceptance to WFH open the market for women talent in the pharma sector who have had to take career breaks for family reasons and would like to return to part-time assignments? Obviously, this can’t be possible for production-related positions but in Finance, Marketing, etc.?
The large scale WFH execution and acceptance currently witnessed are being carefully studied for its consistency and efficacy in the long-term. Once WFH is confirmed and proved to be a long-term strategic initiative and not just a short-term tactical arrangement, it holds the potential for ushering a whole new generation of women talent across industries.
A mature and structured WFH model will encourage companies and women talent alike to arrive at mutually beneficial models of engagement. Companies that proactively map the availability and prepare their access to the passive talent lot will have a substantial first runner advantage in taking up the best and top talent in the functions like HR, Marketing, Finance, Quality, Content, and others.
A significant portion of the skilled talent pool, suitable but currently not engaged, may widen the availability per role, and optimise the costs for these roles to the advantage of the employers. However, unlike IT, pharma’s maximum roles are in sales and R&D. Both cannot be done remotely. Hence a dramatic shift in the participation rate of females is challenging.
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