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Pharma Growth Challenge

Pharma Growth Challenge 

By William Graham

When Greg Ellis was named President and Chief Operating Officer of Mississauga-based SteriMax two years ago, he knew the company, which markets and distributes niche evidence-based medicines, needed a strategic plan to effectively exploit its growth opportunities. SteriMax's founder and CEO, Mike Acharya, wanted to increase its roster of products and create a strong platform for continuous growth.

"We are a smaller organization with a tangible prospect for significant growth, and anybody with a strong business background, particularly a Chartered Accountant (CA), knows companies can easily fail if they mismanage growth," says Ellis, a CA who spent 15 years in a variety of senior financial and commercial roles (including Director of Strategic Planning) at Wyeth Pharmaceuticals.

In assessing the challenge, Ellis highlighted the requirement for a clear customer value proposition and a preoccupation with value-added products and support services. To facilitate this, the pillars for SteriMax would be its people, processes and infrastructure. "Like many companies, the emphasis at SteriMax is on having the right people in the right positions at the right time, and we needed to elevate our processes without surrendering customer responsiveness, flexibility and adaptability," says Ellis. "Our off-site strategic planning session afforded us the opportunity to step away from the more reactive daily demands and do some longer-term proactive thinking about our customers, our products and the three pillars."

SteriMax, a privately held organization, had an established relationship with KPMG Enterprise partner Dave Cook, so when Cook raised the prospect of Strategic Planning experience at KPMG, Ellis' interest was piqued. "I would not necessarily have thought of a public accounting firm as my strategic adviser," says Ellis. "But I thought I could forego deep knowledge of our industry in favour of KPMG's strong business acumen and a good knowledge of our key attributes that was facilitated by our public accounting services affiliation."

Step one was to explain to the management team exactly why SteriMax needed a three-to five-year-plan in the first place. "In essence, you need to begin with the end in mind," says Ellis. "We had a lot of initiatives that were active, but we needed to hone in on how we were establishing our priorities among a variety of important initiatives. We also needed to set some goalposts to allow us to measure our success with those initiatives. Maybe it's my financial background but I have long been an advocate of the philosophy that what you measure gets done."

Cook then introduced an exercise related to capturing the SteriMax customer value proposition. The task was to answer the question, "Why do customers buy from us?" According to Ellis, "This was a great starting point because we wanted to have a strong customer-centric orientation as a driver to the planning process." KPMG also orchestrated a novel form of SWOT analysis, rooted in interviews of the management team and the majority of SteriMax's employees. "The interviews provided the internal perception of where we are and what our challenges are, and it provided a forum to get some early engagement from the team that would inevitably convert the strategy into action. It also forced the planning team to give due consideration to external influences. We did not want to plan in a bubble."

Ellis and his team then spent two days off-site, in a session facilitated by KPMG, coming up with a shortlist of relatively simple, straightforward statements that captured the key strategic initiatives. They also developed a specific target for revenue five years down the line.

Returning to the office with a renewed sense of purpose, the management team is in the process of staff engagement. The off-site proceedings were promptly shared with the staff, and the strategic initiatives were introduced as the backdrop for the process of establishing goals. Strategic initiatives have been cascaded into corporate goals, departmental goals and, finally, individual goals. The underlying theme here is "alignment." ""We strive for what we call "SMART" goals," says Ellis. "Specific, measurable, achievable, relevant and time-bound."

On an ongoing basis, the plan is to keep the strategic initiative front and centre at biweekly management and quarterly town hall meetings. "On our individual performance assessments, we put a heavy weighting on our success with achieving the goals that will bring our strategy to life" says Ellis. "While never perfect, we hope to have provided the entire team with a clearer vision of our priorities for success and accordingly advanced our effectiveness. We want SteriMax to be a good place to work, and we want our staff to know that what they do makes a difference for SteriMax and for the health of many Canadians."

Ellis encourages other entrepreneurs to go through a strategic planning process. "Most small businesses focus on getting people with functional expertise, but they may not always find the time to coordinate the variety of projects and challenges that arise," he says. "For us, a relatively minor investment of funds and time has allowed us to bring a better clarity of purpose. Having a trusted third party - in our case, KPMG - provided a framework for our discussions and brought objectivity and focus to our process."

As for SteriMax, the company has continued to grow its staff by more than 30% per year for the last few years, in keeping with a product line that has more than doubled. With a renewed strategic plan, the company is on track to sustain remarkable growth over the next few years. According to Ellis, "I think we are getting more focused and we now have a better grasp of what good looks like."

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