The Growing Importance of Forecasting Expertise in Pharmaceuticals
Forecasting is considered a business-critical tool for planning and development within pharmaceuticals, but many lack the time or methodologies to train forecasters effectively inhouse.
Pharmaceutical companies are gradually waking up to the pivotal role of forecasting in effectively running a business and delivering treatments to patients who need them. Accurate forecasts enable well thought out decision-making around things such as product development and production capacity, while lack of foresight can have potentially catastrophic consequences.
However, it’s not as simple as assigning team members the responsibility for creating and updating forecasts. In fact, all too often this can be as damaging as not forecasting in the first place…
The forecasting skills gap in pharmaceuticals
Forecasting is a niche that has traditionally been overlooked in pharmaceuticals. A few team members might be tasked with the role of data analysis and forecast development, but largely these individuals would be self-taught and constrained to certain functions within the business.
Nowadays, forecasts are often seen as a business-critical tool for planning and development across the board, and yet little progress has been made in upskilling workforces. Often, these self-taught ‘experts’ within a company are in charge of training their peers in forecasting, despite lacking the time or methodologies to do so effectively.
This has become apparent to the J+D when running our own training sessions with pharmaceutical companies. Often, we find that those with the most in-house expertise are missing a full understanding of some key concepts and additional structure to their thought processes that can bring real benefits. The level of capability, retention and accuracy can vary significantly from one person to another, especially when learning from colleagues.
Why training is essential to better forecasting
A thin layer of expertise just won’t cut it anymore. Bad forecasting can have a knock-on effect on the whole company. For example, underestimating demand can lead to running out of product – a scenario that is almost unthinkable in an industry so vital to individuals’ health and wellbeing as pharmaceuticals.
These discrepancies can be avoided when those responsible for forecasting follow best practices, such as breaking down a forecast into three main steps: define the market, trend it out using historical data, then add events to explore the impact of occurrences that can’t be predicted from the historical data alone. In this instance, we often find that self-taught forecasters merge steps two and three, which may save some time in the short-term but loses a lot of insight along the way and is usually less efficient in the long-term.
When forecasting has become such a key element of business planning and product development, pharmaceutical companies cannot afford to rely on weak forecasting expertise. In recognition of the lack of support available for the industry, J+D have developed a suite of training solutions to help those responsible for forecasting to get better.
Only by improving in-house capabilities can pharmaceutical firms have confidence in the depth, relevance and appropriateness of the forecasts shaped by their team. A small investment in skills and training can have an invaluable impact on decision-making across all areas of a business.
For more information about forecasting training from J+D, get in touch today.