“How do we build a technology stack that’s going to allow us, over the mid- to long-term, to orientate all our energy towards serving the customer, whatever that might involve?”
This is the principal question that Ranjit Gill, head of B2B for EMEA and UK CIO at global healthcare and pharmacy services giant McKesson, is applying to the digital transformation of its European operations.
It stems from a fundamental belief that, in McKesson’s market — which in Europe is heavily weighted towards ownership and supply of hospital and retail pharmacies — the biggest differentiator is often the experience of the customer. “The levers we have for driving better business outcomes are limited,” Gill explains. “So if it’s 50-50 versus our competitors in terms of price and on-time delivery, then it comes down to the company that’s best to work with and allows our customers to be the most efficient.”
Gill’s constant attention, therefore, is on finding ways to apply digital technology to enhance this competitive edge, and ultimately to support the delivery of McKesson’s corporate promise “to improve patients’ lives every day.”
Making customers’ lives easier
One recent example of this is the transformation that Gill has brought to McKesson’s business-to-business operations in Europe. Much of the focus for the company, which supplies more than 55,000 pharmacies and hospitals on a daily basis across 13 European countries, is around ‘short-line’ products – that is, pharmaceuticals where the pack date is nearing expiry.
Until recently, the sales operation was largely conducted through the monthly publication of a printed catalogue. In spite of the fast-moving nature of the short-line business, buying was slow and inefficient. However, by digitizing the entire process, and moving it to an online portal hosted in the cloud, McKesson has made that far more rapid and convenient — and delivered an uptick in its net promoter score among the pharmacies it supplies.
The next step of this transformation was to create an online portal for over-the-counter (OTC) products, such as shampoos, creams and ointments, that allows McKesson’s customers to replenish stock in a fast and simple way. Where an item on the shelf is running low, pharmacists can now use a barcode scanner to scan one of the products and simply select one of 10 options to re-order the desired amount.
“It’s a great innovation that we can give customers to make their lives easier,” says Gill. “Nobody asked us to do it, but it’s a tool that has enabled us to deliver something to differentiate us in the market. By interacting with us better, they can service their customers better.”
These new digital offerings sit alongside a move to a cloud CRM system that gives McKesson a single view of the customer and has allowed for better service at its call centers. “All of these add up to something material that creates a virtuous circle,” he says.
Gill is applying similar customer-centric thinking to McKesson’s healthcare-provider operations in the UK, where it delivers an outsourced service to the country’s National Health Service (NHS) to visit and treat patients in their own homes. The application of digital technology in this sphere has particularly helped with addressing patients’ needs during the Covid-19 pandemic, both in terms of enabling them to avoid the risk of becoming infected by not needing to attend hospital and giving them more control over appointments.
“It’s all about how we make sure that, in a world of Covid, we’re able to support and provide critical medical care,” says Gill. “Moving to digital platforms has allowed our patients to more easily select when nurses come to visit, so they can book appointments at a time that’s suitable. It’s also allowed us to schedule our nurses better to give them enough of a gap between visits to ensure their PPE [personal protective equipment] is refreshed.”
Transforming the IT function
Focusing digital technology on delivering against patient and customer needs in this way has not always been straightforward, admits Gill — particularly in light of IT’s historical reputation for a lack of customer-centric thinking.
“A perception has been built across many different organizations over many years that IT functions have been very inward-looking, with IT people having a tendency to only want to talk to IT people,” he says. “That can be very useful to some extent, but also very limiting, because the reason you have an IT function is to deliver the business goals, not IT for IT’s sake.”
In order to keep technology teams focused on the bigger picture, therefore, Gill believes it’s important for CIOs to have a seat on their organization’s board, where possible, and to be an equal partner to those running other functions. As a McKesson UK board member and part of the executive leadership team, Gill is responsible for the P&L and the strategic goals that the organization delivers. “IT is a part of that just as is supply chain, sales and commercial, HR, finance, and so on. It creates a really good join-up on how technology is going to deliver the business goals.”
Gill also argues that choosing a user-friendly cloud-based solution (McKesson opted for Salesforce.com to deliver its customer-focused services) has helped. “Because everything is relatively easy to implement, and it is highly decentralized, we don’t need to employ an army of IT people to run and maintain the service,” he says.
“That means we can fill our project teams with people who are focused on delivering business value. It allows us to have more meaningful, value-driven conversations with the business rather than lots of internal IT conversations on things that aren’t going to directly make a business impact.”
Primed for the future
And when it comes to his long-term vision, Gill firmly believes it is people, rather than technology in itself, that will be the key to sustained success.
“We’ve made a huge investment in terms of pure capex and refreshing the technology, and we’ve started to see really positive results because of that,” he says. “But the next step is how we start to drive added value from this technology.”
That, he explains, will require engaging people — and forging strategic relationships with organizations — with the right skills. “These could be data scientists or artificial intelligence experts, for example, who can really look at the next level of our existing technology and see how that can give us incremental customer-experience improvement or incremental sales growth or better margins. That will come from upping the skillset of our organization.”
He illustrates the point with an automotive analogy. “We were perhaps like a charming old gentleman, driving a small, old car on the slow side of the motorway,” he says. “And all of a sudden, we’ve given him a Porsche 911 Turbo — but if he’s still driving on the side of the road in second gear, what’s the point? You might as well have left him in the old car.”
The future therefore requires a mindset transformation too, he argues. “It all comes down to organizational change and thinking about how the next generation of employees is going to use this new technology to take the business forward. And that’s the really exciting part.”
• Ranjit Gill was a Trailblazer speaker at Salesforce Live. Watch the session.