Show Menu
Cheatography

Key Drivers For Outsourcing Partner Selection Cheat Sheet (DRAFT) by [deleted]

This is a draft cheat sheet. It is a work in progress and is not finished yet.

Introd­uction

Each business has its own approach to outsou­rcing, from functional to full service, and often that approach is dependent on the requir­ements of a specific project. While needs change and outsou­rcing practices evolve, there are several fundam­ental traits that have shown their relevance when selecting a partner. Prelim­inary research through in-depth interviews with industry profes­sionals helped Nice Insight generate a list of attributes that drive outsou­rcing decisions and uncover how and why these attributes impact partner selection. Each quarter, Nice Insight surveys the pharma­ceu­tical and biotec­hnology industry and asks that respon­dents rank these traits in order of import­ance.

Quality And Reliab­ility

Quality and reliab­ility held the number one and two positions respec­tively throughout the year, showing the importance of delivering to the standards establ­ished by the sponsor of the project as well as meeting the agreed project milestones and timelines. Contract businesses fared well within these measures, establ­ishing a benchmark rating for CMOs and CROs at 70% for quality and 69% for reliab­ility. When selecting a full-s­ervice partner, look for businesses that score at or above the industry averag­e/b­enc­hmark on these attrib­utes.

Afford­ability

Afford­abi­lity, or how compet­itively and accurately a contract organi­zation prices a project compared to other bids within the market, ranked fourth in Q1. However, afford­ability was ranked as the third most influe­ntial driver during the Q2, Q3, and Q4 surveys. As such, afford­ability ranked third overall for 2011. Again, CMO and CRO benchmark scores were similar, in that the average afford­ability rating for CMOs was 68% and 69% for CROs.

Regulatory Track Record

The contract organi­zat­ion’s regulatory track record ranked third in the Q1 survey, but dropped behind afford­ability and produc­tivity to fifth in Q2 and Q3. Perhaps related to several high-p­rofile contract manufa­cturers receiving 483s in the latter part of the year, regulatory compliance moved up in rank to fourth place in Q4. The aggregate ranking across all four quarters for regulatory positioned this driver in fourth place for 2011. Across each of the outsou­rcing drivers, CROs and CMOs scored the highest in regula­tory, each averaging at 73% to set the benchmark.
 

Produc­tivity

Produc­tivity links closely to innova­tion, as CMOs or CROs that score well in this category have demons­trated the ability to allow the sponsor to focus on core compet­encies while trusting that the agreed technical objectives for the project are being fulfilled. Intere­sti­ngly, produc­tivity was ranked fifth in both the Q1 and Q4 surveys and fourth in the Q2 and Q3 surveys. The benchmark for produc­tivity was 71% for both CMOs and CROs. Produc­tivity received the second highest benchmark score out of the six outsou­rcing drivers.

Access­ibility

The final driver in facili­tating collab­ora­tions speaks to the commun­ication challenges iterated by pharma­ceu­tical and biotec­hnology sponsors. Access­ibi­lity, or knowing that personnel will be available when needed, ranked in sixth place across all four quarters. While access­ibility may have ranked last among these six attrib­utes, it is still an absolute essential for a strong (and long-l­asting) outsou­rcing relati­onship. Especially consid­ering that a “lack of support” and “waiting to inform [the sponsor] of a potential problem” are frequently cited as reasons to discon­tinue a contract relati­onship. Fortun­ately, the CROs and CMOs rated in the Q4 survey have establ­ished a strong score for the access­ibility benchmark, both at 70%.

Conclusion

Whether it is time to review the CROs and CMOs on the preferred vendor list, or there are plans to enter into a relati­onship with a new contractor in the coming year, benchmarks can help provide context on how the industry performs — and offer assurance that the contractor selected has been meeting or exceeding the industry standard. When consid­ering a full-s­ervice partner, it is essential to evaluate how the business scores on each of the outsou­rcing drivers as a whole. Knowing how satisfied industry peers have been with their outsou­rcing partners can help serve as a guide.