A specialist in revenue optimization and compliance, has recently released its sixth annual State of Revenue Report. This report sheds light on the key business priorities and challenges faced by executives in the life sciences and high-tech sectors.
In the 2024 report, executives in these industries have identified process efficiency and cost-saving measures as their top priorities. They are focusing on leveraging advanced analytics and artificial intelligence (AI) to achieve these objectives. Interestingly, supply chain disruption has once again emerged as a significant obstacle to innovation for the second consecutive year across all sectors.
The report also highlights various challenges hindering innovation, including evolving customer demand, material availability fluctuations, regulatory changes, and staffing issues. A notable finding is that three-quarters of executives believe that there is room for improvement in their current revenue optimization strategies. To address this, many are planning to enhance their revenue operations by integrating advanced analytics (68%), AI (59%), and robotic process automation (46%).
Rehmann Rayani, the Chief Strategy and Marketing Officer at Model N, emphasized the transformative impact of AI and analytics on revenue optimization and compliance in the life sciences and high-tech industries. He highlighted how outdated manual processes can undermine profitability, emphasizing the need for data-driven insights to maximize revenue and ensure compliance.
Despite the growing importance of data-driven decision-making, 60% of executives feel that their organizations are not highly data-driven at present. However, nearly all executives leverage external data sources to inform their business strategies. Moreover, there is a willingness among 94% of executives to contribute data anonymously to create industry benchmarks that can guide revenue strategies.
In the life sciences sector, executives are particularly concerned about compliance and communication challenges. Pharmaceutical manufacturers are apprehensive about the impact of regulations on future revenue, especially regarding price negotiations with Medicare under the Inflation Reduction Act. Challenges related to formulary validation and membership management processes were also highlighted.
For medical technology executives, improving communication between field sales and operations teams is crucial for enhancing deal execution and profitability. The industry is transitioning towards recurring revenue models, presenting challenges in managing these evolving models effectively.
On the other hand, high-tech manufacturers have yet to fully leverage channel sales data for pricing decisions, with only 27% consistently using this data. Utilizing channel data effectively can provide valuable insights for strategic decision-making and help mitigate risks associated with unauthorized sales.
Suresh Kannan, the Chief Product Officer at Model N, emphasized the importance of evolving business practices to harness the power of data and advanced analytics in overcoming industry challenges. The 2024 State of Revenue Report underscores the need for optimizing revenue processes through data-driven strategies to address critical business needs effectively.
For more in-depth industry-specific insights and analysis on revenue optimization in the life sciences and high-tech sectors, refer to the complete 2024 State of Revenue Report.