Successfully managing CMO-client relationships

September 1, 2010
Peter Soelkner

Peter Soelkner is Managing Director of Vetter Pharma International GmbH, Germany.

Pharmaceutical Technology Europe

Contract manufacturers must view their relationships with clients as a partnership, which lasts beyond the fulfillment of a particular project, and not simply as a single transaction.

Contract manufacturers must view their relationships with clients as a partnership, which lasts beyond the fulfillment of a particular project, and not simply as a single transaction. To do this well requires the identification and understanding of how we can help our customer’s entire business to become more successful, rather than just focusing on the success of a single product. We need to understand their strategy and learn more about their entire portfolio and business model. This level of trust requires a mutual effort towards open, honest and continuous communication and the careful management of expectations.

Peter Soelkner is Managing Director of Vetter Pharma International GmbH, Germany.

Virtually any breakdown in the business relationship can be traced to a breakdown in communication or the failure to capitalise on lessons learned.

Instilling confidence from the start

Every relationship must begin with the understanding of a customer’s overall goals beyond the project at hand and the development of processes that address these goals. We must instill confidence in our customers that their project is as important to us as it is to them and we must demonstrate this confidence through the action of adding value in each step of the process. How this is executed in a tactical manner is critical to the management of the relationship and depends primarily on the nature of the project and the business model of the customer. This is why every effort should be made from the beginning to cultivate comprehensive partnerships that evolve in trust and a collaborative environment between the CMO and the customer. Anticipating the customer’s needs as the relationship evolves, and addressing and explaining challenges as clearly and as early in the process as possible will also help minimise misunderstandings and strengthen the relationship between the CMO and the customer.

The main challenges

Lack of communication, failure to manage expectations, inconsistency in communicating with “one voice”, and a lack of creative and innovative approaches to difficult projects will challenge any relationship. Managing the expectations of clients is the foundation of good customer relationships. Projects cannot, and should not, proceed without the customers’ needs anticipated. Creative solutions to problems must be provided immediately as the product is being developed and produced. Adherence to the production schedule must be carefully monitored and any delay immediately communicated and explained to the customer. Open channels of communication should address any problem before it becomes critical, and also instills confidence in the CMO and adds value for the client.

Properly managed, the benefits of effective CMO–customer relationships will result in optimised costs, improved efficiency and mutual success. We have found that peer-to-peer relationships, regular team meetings to ensure ongoing and consistent communications and ongoing team building at all levels are imperative success factors inherently found in projects with good outcomes.

To hear Peter Soelkner discussing Vetter’s expansion into North America through the opening of its new facility in Chicago, please go to www.pharmtech.com/vetterpodcast

www.vetter-pharma.com