On March 13, it was undeniable that 2020 was going to be a truly awful year. Maybe we didn’t quite expect the extent of the economic calamity, didn’t quite grasp the depth of the public health emergency and didn’t have the clairvoyance to tack on massive social unrest and bruising to our collective mental well-being. But we definitely knew we were headed somewhere we didn’t want to go.
As we feel around in the dark for silver linings to the crisis, much has been written about huge reforms in cross-state physician licensing and the shattering of digital health reimbursement barriers. Rickety supply chains are now flexing to meet new needs. True leaders are emerging among chancellors and governors. The mixed blessing of time with our families. There is one more bright spot: what I call the “medtech mulligan.”
As kids, a bowling ball thrown in the gutter called for a do-over. On our computers, we call it Ctrl+Z, or the backwards arrow of the undo command. In golf, it’s called the mulligan, the chance to pretend something never happened. Forget about that hopeless last shot, shake it off and start over. How much we wish we could do that in real life.
When mid-March rolled around, the public health and economic crisis of our age scrambled everything. Non-essential procedures plummeted, patients hunkered down and forgot about their aching knees, shortness of breath and concerning dark spot on their skin. The patient journey from presentation to diagnosis to intervention ground to a sudden and worrying halt. Whether the giddy return to procedures is sustained or sputters out, it’s clear that 2020 is going to be a year without comparison or precedent. Most medtech executives retracted investor guidance, closed the shutters and waited nervously to ride it out. 2020 is bad, and it’s a year to reset expectations.
This last point though, the reset expectations part, actually represents a huge opportunity. Many executives have previously felt unable to make changes based on investor forecasts. We have impossibly high expectations from our customers about the service we would provide free of charge. We maintain painfully expensive and specialized field teams focused exclusively on in-person interactions without much augmentation with modern case coverage and digital communication methods. We have channel structures that made sense at one time but are now costly, lethargic and insensitive to strategic direction. We have compensation plans that fail to reward and motivate performance. Nervous about Wall Street expectations, we trade price to push product hard to close a quarter. We aren’t able to explore innovative business models for that next robot because the street needs to see that customers would pay a premium. We rely too often on launching and sustaining incremental innovation that may not truly drive value for customers. We haven’t yet built the patient marketing capability to support patients in finding their way to our therapies and driving brand choice. We are shy about investing heavily in multi-channel and digital marketing because so much money is needed to sustain our current go-to market.
With volumes plummeting, customers running out of cash, new product launches frozen and sales reps cooling their jets at home, it seems like the worst time to do anything but ride it out. But I argue now is the best time to reinvent without the constraints that normally apply. It’s time to build those capabilities we never could manage to prioritize. Time to reinvent the surgeon interaction and reconsider the buffet of services that customers suddenly found they could do without. Time to rethink the business model for capital investment, reimagine how we “close the quarter,” re-engineer high-touch selling and reconstruct a value proposition now that priorities have changed. (A few topics like this came up in a really interesting panel I participated in with Jan Kimpen, global chief medical officer and SVP at Philips and Andrew Davies, digital health lead at the Association of British HealthTech Industries, moderated by Ashley Yeo at Informa’s COVID-19 web event. The event was recorded and available here.)
The enormity of the reset forced by COVID-19 is giving medtech a unique moment to take a mulligan. Let’s not waste it.