The MedTech industry is in a unique position in 2023. While the global medical devices market share is expected to grow from $512 billion in 2022 to $799 billion in 2030, the industry is still reeling from supply chain disruptions while trying to understand the impact new technologies and market shifts will have on operations.
To make the most out of these challenges and find success in an uncertain environment, MedTech professionals need to embrace the power of negotiation training. The right training can help individuals navigate these situations with ease, learn to understand their range and strength of power, and succeed in tense discussions.
RED BEAR Negotiation Training is trusted by forward-thinking companies across the globe. We focus on providing unforgettable, tailored learning experiences that get businesses measurable results.
Let’s explore some of the key trends facing the medical device industry and learn why negotiation training is so essential to mastering this new and dynamic landscape.
Reconstructing Resilience in MedTech Supply Chains
While the initial disruptions in supply chain logistics spurred by global lockdowns are seeing some relieved pressure, the MedTech industry is still facing some significant issues around reconstruction and resilience.
From the perspective of physicians and other practitioners, more than half of surveyed medical professionals can recall a time in the last 12 months when they didn’t have access to an essential product necessary for a patient’s procedure.
More than half of surveyed medical professionals can recall a time in the last 12 months when they didn’t have access to an essential product necessary for a patient’s procedure.
While this issue has certainly become exacerbated by the pandemic, even before COVID, the industry was facing challenges to supply expenses.
These types of expenses can make up to 15% of overall hospital expenses, with specialty hospital environments sometimes hitting an overwhelming 30% to 40% in supply expenses. As you might imagine, increased costs in medical devices caused by supply chain disruptions have a massive impact on how a hospital is able to manage its budgets and provide care.
What the pandemic and subsequent supply chain disruptions, spurred on by other factors as well, are causing is increased volatility in the industry.
Take raw material costs. In the production of medical instruments and devices are alloys and metals such as titanium or cobalt-chrome. Heightened geopolitical risks, energy crises, and other impacts directly influence the continuous supply of these essential materials.
Building resilient supply chains to mitigate some of these raw material risks means leveraging the power of negotiation to establish better terms with suppliers, like flexible contracts or better service levels. This can help with managing critical shortages in raw materials like alloys or even other materials like chip sets, even during times of geopolitical volatility or health crises.
These chipsets are becoming a critical component in the future of MedTech. The problem is that the industry is not the only one vying for these types of digital devices.
This means MedTech professionals will need to diversify their supplier relationships. RED BEAR Training can help businesses in times of supply chain crisis when having the skills to find reliable alternative sources of supply is invaluable. With our training, individuals can negotiate valuable agreements with alternative suppliers quickly and effectively — reducing the dependency on a single supplier.
“With our training, individuals can negotiate valuable agreements with alternative suppliers quickly and effectively — reducing the dependency on a single supplier.“
Negotiation skills are also necessary to manage risk-sharing agreements. This could be volume commitments or penalties for delivery. These types of agreements can help protect businesses from the full brunt of supply chain disruptions.
Value-centric Approach: The New Norm for Customer Partnerships
While historically, the relationships between medical device manufacturers and hospitals were fairly separate from direct contact with the consumer, that’s rapidly changing.
Medical technology producers are seeing a shift toward value-based care. Hospitals are not looking for surface-level relationships with medical device suppliers; they’re starting to value more intimate partnerships with stakeholders that understand the business, act proactively in delivering new ideas, and are flexible in their approach to solution delivery.
This puts MedTech professionals in an interesting position. Good negotiation skills will be essential to navigating these novel and complex discussions, ensuring all interests are aligned, and businesses can forge long-term partnerships that deliver win-win results and mutual value.
While this environment is rife with new challenges, there are plenty of opportunities for MedTech companies to expand the marketplace for their products.
This new shift in the industry will put an emphasis on the patient/user, and MedTech companies will need to incorporate more digitally enabled consumer engagement into their product designs.
RED BEAR Training can help teams facilitate these intricate discussions with different stakeholders (including consumers, healthcare providers, and tech partners) to better understand the needs and expectations to incorporate those insights into product design and engagement models.
For example, the wearable medical technology sector is growing — expected to reach a $54 billion market valuation in 2023. With the popularity of wearable devices like Fitbit, the industry is seeing immense research and innovation in the area in a variety of health, clinical, research, and drug-development use cases.
As these discussions start bringing in new stakeholders, it will be essential for MedTech professionals to understand what negotiation methods can build value and close a deal with these new players. This might mean setting the right targets, managing information correctly, and leveraging a business’s strengths. All these skills are essential to mastering this new trend in the industry, and RED BEAR is here to help.
With the growth of the wearable tech industry, more opportunities for remote monitoring and patient engagement emerge. Negotiation training will help individuals understand the power of setting high aspirations and anchoring in negotiations — both critical skills needed to negotiate beneficial deals with wearable tech providers and suppliers or to create partnerships to develop new devices.
Lastly, alongside the development of wearables technology and the shift toward value-centric relationships with hospitals is the growth of at-home care treatment options. With an aging population and an increased prevalence of chronic disease, at-home healthcare is on the rise in developed countries.
Not only will this bring in more new stakeholders, like insurance companies and the patients themselves, but it will also emphasize the need for skilled negotiators to not only manage pricing strategies but also find critical areas for product innovation based on these discussions.
With all these new stakeholders and new areas for discussion, it will be critical for organizations to create enterprise-wide negotiation processes built on the right principles and behaviors.
Also, with the preferred path forward being to launch separate business ventures, good negotiation skills are crucial to securing funding from investors, negotiating joint ventures, or establishing strategic alliances.
Keeping Pace with Advancements in MedTech
Another key shift in the medical devices industry is embracing advanced technologies like virtual reality (VR), augmented reality (AR), and 5G — each redefining how industry professionals approach the design, development, and deployment of medical devices.
In healthcare, VR headsets are becoming an essential tool in the training of doctors and surgeons. They allow users to gain knowledge and hone skills without putting a single patient at potential risk. On the patient side, VR is essential in creating therapy plans helping with everything from chronic pain treatment to anxiety disorders.
Powering these changes is advanced communications technology like 5G. These hyper-fast networks enable the growth of next-generation medical services.
Telehealth and telemedicine alone are seeing some real growth, due in part to the adoption of 5G as well as the need for remote care driven by COVID-related access restrictions. It’s estimated that among adults 18 and over, 37% used telemedicine in the last year.
Embracing these new tech trends in the industry will require skilled professionals in both internal and external negotiations. Teams will need to negotiate favorable contracts with VR/AR providers and training institutions that can help them deliver better products and services to their users.
RED BEAR Training can help individuals understand where to find win-wins by placing needs over wants and positioning their case efficiently to influence value during negotiations. These are all essential tools in getting beneficial deals with tech providers — and we can do it both in-person or digitally.
Similarly, advances in 5G communication will allow for faster internet and greater bandwidth to power real-time remote patient monitoring, telemedicine, and robotic surgery. Again, the right negotiation training can help teams find mutual understanding during discussions, which can help develop long-term beneficial relationships with 5G network providers, helping spur the integration of these advanced capabilities.
With more patients using telemedicine, MedTech companies need to negotiate with a range of stakeholders, from healthcare providers to software developers, to ensure their products are compatible with this new mode of healthcare delivery.
The Negotiation Edge: Securing Success in the MedTech Industry
The MedTech industry is facing some unique challenges in 2023. While supply chain issues and embracing new technologies are fairly common trends facing virtually every industry, these factors are creating new initiatives that shift how medical device businesses interact with stakeholders like hospitals and bring consumer needs to the forefront of device development and deployment.
The key to navigating this new environment is negotiation training. With RED BEAR Negotiation Training, your business gains access to expert instructors whose goal is to transform your team into world-class negotiators.
Not only do we focus on the right negotiation processes built on tested principles and behaviors, but our training is trusted by everyone from Fortune 100 companies to high-growth startups.
To learn more about the RED BEAR Training difference and touch base with an experienced team member, reach out today.
