How to Sell Your EHR and IT Products to Clinics and Physician Practices
A frequent question I am asked by startups and new product development teams (especially those building EMRs / EHRs) is “what’s the best way to sell my EHR to doctors and clinics?” My friend Steve Carbonara has been selling software to practices for years so I asked him to write a companion to his piece on selling to hospitals. Steve currently heads Sales Force Effectiveness at Bard Medical and runs his own consulting practice helping companies with their sales process. Over the past 4 years he has worked with several start ups and medium sized businesses; his roles range from providing sales leadership, to defining product strategy, product development, raising equity and implementing sales processes. I invited Steve to share his advice on how to sell health IT products, especially EHRs, into physician practices and clinics. Here’s what he had to say, in the second of several articles in this series, on the subject of understanding how doctors buy medical technology:
The first thing to understand about the purchase of any important health IT software, especially EHRs, is that the purchase can take place at the hospital level or the physician clinic level. We’ll discuss the how and why of each and how you as a vendor may want to structure your process around these different buyers.
So, you have an EHR solution that you want to get into the hands of physicians. What’s your first problem? There are 400+ other vendors like you trying to do the same thing; the advent of Meaningful Use provided that every business person would get into this market, so it is a little crowded at the moment. Knowing that the consumer has many options, you must align yourself with your customer closely, so that you provide clarity in a sea of confusion.
The second problem is that many doctors are not buying solutions from you; they are trying to buying your solution from a hospital because the Stark Laws were relaxed years ago. If this is true and you find yourself selling into hospitals for the right to capture physician clinics, read my last post about that buying cycle (many general physicians fall into this category). The buying cycle of the hospital will be tenuous and hard for your team and that the hospital will probably end up going with one of the top 5 to 10 systems in the market, I think they call it risk mitigation. If you’re a small company or startup, the hospital will see your size as a serious threat to you providing them with long term solutions.
Selling into Physician Clinics
You have to answer some basic questions of yourself before you can get started. Examples:
- Who is your client going to be? The more specific and segmented you are, the better.
- Are you doing the shot gun approach and calling on every clinic or are you going to build your solution to specifically sell into, say, Dermatology clinics (you can pick any specialty as Dermatology is just an example)?
- Will you sell the Practice Management, Revenue Cycle Management, Personal Healthcare Records and other solutions to round out your offering of an EHR?
- If not, will you be working with partners to offer these ‘add on’ solutions to your clients? The better defined you are upfront, the more success you will have as you can easily build your products and process around the needs of that smaller segment. The shot gun approach may seem easier, as you have more market to sell into, but if your product doesn’t answer the needs of any of those buyers, then you’re the one staring down the barrel of the gun in the end.
Potential Roadblocks to Alignment
Once your target market is understood and you can align more closely your sales process to their buying process, what’s going to affect your process?
First, the government is working through groups called Quality Improvement Organizations (QIO’s); these groups have been tasked with helping clinics adopt technology. These groups are funded by the government and are thus free to the clinic, so the buying cycle may be affected. They are supposed to be objective with no allegiance to a product. They are also supposed to help the doctor, but by being funded by the government, many doctors don’t trust their actual intention.
Second, consultants are typically involved with larger clinics, say 10-50 doctors in size, and their experiences with previous clients of the different technologies will definitely affect their buying process. All I can say to you on this is good luck. Consultants should be objective and they should present all opportunities to every company in the same manner, but I’ve sold for over a decade and can tell you that many of the consultants I worked with were being paid by another vendor. You’re going to have to understand your options here; if there’s a bad consultant in the deal what options do you have? First decide if you even want to be a part of it? Should you approach one of the doctors or administrators of the clinic to discuss your concerns about the consultant? I’m a big fan for blunt communication so you know where I stand, and if you’re going to lose the sale in 5 months, why not choose to lose it today and not waste 5 months? Work smarter not harder, I think I heard that somewhere once.
Lastly, once you get into clinics above 50 doctors in size, you are dealing with a corporate structure that includes the CEO, CFO, CIO, etc. This type of structure will align this size of clinic with the buying process of a hospital – typically very long and arduous. Knowing this, you may choose to not work with the larger clinics; or, you may think to focus on them knowing that for every one large clinic you would work on 50 smaller ones to equal the same revenue opportunity. Your call.
Aligning the Sales Process to the Buying Process
Let’s get back to the buying process; my example above is that my product is targeting the Dermatology segment, so let’s go forward with that. Aligning your selling process with this segment’s buying process is important, but another very important piece is aligning your product with their need. Dermatologists sell products for skin care – do you have an inventory module? If you don’t, do you have the ability to partner with an inventory system and integrate so that you can provide a solution to your customer – or do you just want to sell them your solution and leave them to wonder how to handle the inventory issue? Setting yourself up for success begins with solving the customer’s problems, there are a ton of products out there that provide all the basics, take your product to the next level.
As clinics are not as top heavy with administration you know that you’re going to be talking directly to the business owner, the physician. Through the process you will be working with the front desk and back office staff, as well as the nursing staff. Self inventory needed:
- Do you know the questions that they’re going to ask?
- Are you familiar with their processes and workflow so that you can offer solutions to their needs?
- How can you present information that would be consultative?
First, make sure you know if there are any influencers like a QIO or a consultant. If there are, then there will be some type of process put into place. Typically these people will do needs analysis and then make you provide information back to the practice in a very template driven manner, so that the buyer doesn’t become influenced by anything other than the facts. The scoring system used by this influencer is something that you should understand up front, so that you can choose to participate or not, if the scoring is based mainly on company size and strength and financial success is the top rated item, you may need to see how you compare to the top companies before responding to the request.
Second, if there are not influencers involved make sure you are asking the buyer what they think their process is going to be. The more information you can gather on the initial call the better, examples:
- Will they want to do a phone reference or a site reference with one of your clients?
- Will they require that this client be within the state?
- Do they want to see your financials to prove your lasting power?
- Will there be a committee to select the solution or will the doctors choose?
- Do they have the budget in place and what is their time frame to decide?
If I know the clinic is 5 doctors and they are going to review 5 solutions and they want to do site visits and decide on a solution through a team of 10 people, I know that this is going to be a 6 month sales process. I surely need to know that they have a budget in place and they are committed to a time frame to decide prior to putting my effort forward. Once I get the basics covered, I move to the next step, process control.
Process Control – Become the Consultant
If you’re working with a clinic with no influencers you will find that the doctor really doesn’t know their selection process, they go more with gut than process. They will always say that they have the budget and they are going to decide as soon as they find the right solution – so how can you affect this process to make sure you don’t waste your time? Depending on the conversation with the doctor I typically assume the role of the consultant – even though I’m their sales person (it is the reason I left sales and became a consultant). I would sit down with the doctors and office managers I worked with and scope out all of the above. I would tell them of best practices I’ve learned over the years, of how some have failed while others succeeded and how to make sure they succeeded. I was honest and I was blunt, and it allowed me to gain their trust so that we could decide if we were a good fit.
If you’re a good fit with the practice you continue forward – if you’re not, then you tell them so and suggest a vendor that they would probably do well with instead of you. I’ve only done this a few hundred times and many times I would have a friend of that doctor call me and say he got my name on referral. You don’t have to have a doctor as a client to have a friend in the industry, and a doctor going out of business in 2 years doesn’t need a new system, so you tell him what to do to optimize his current system and advise him and he’ll tell all of his friends that you were a trusted business associate, because you were.
Now, when you’re working with a physician remember one thing, he’s probably going to pick a solution based on the feedback of other doctors or on his gut. They aren’t the most process oriented people when running a business, so without a consultant they don’t always choose the ‘right’ vendor. If this is true, then why not become the consultant and make sure that you are the ‘gut’ choice in the end. You can do this many ways, I always liked doing the process work for the doctor and presenting to him/her as a ‘did you know’ type thing. Like pulling together information on the 5 vendors he was looking at and making sure that the information I presented painted me in the best light. Why talk about financial prowess when you’re at a startup, talk about solutions designed to fit his specific problems instead. If you’re at the financial giant company, stress that point and how many of these smaller companies typically go out of business within 2-3 years of incorporation. Being the consultant doesn’t mean you can’t sway opinion, you just have to answer all of the doctors questions honestly when they are asked directly – small detail to keep in mind, if you ‘sway’ when asked questions directly then you are lying.
Easiest thing to do once you do the above is funnel management. If you know that you have honest and open dialogue happening with your prospects then you know what is going to close and what’s not going to close – so you can always be sure to tell your boss that you will or won’t have a deal done. Shahid will be posting my article on funnel management in the next segment of this series.