Healthcare Case Study

Innovative Strategy to Increase Marketing Headcount Investment

Introduction

New Operating Model Drives Marketing Organization Headcount Investment

This manufacturer of diagnostic healthcare products considered marketing operating model changes to determine their overlay and dedicated resource needs. In addition, they wanted to map the existing headcount capabilities by function and by the activities currently performed.

Their primary goal was to align their headcount investment to industry benchmarks. Their current headcount-to-discretionary budget ratio was 37%/63%. However, the goal was to increase their headcount investment, targeting a ratio of 32%/68%.

The client chose Alexander Group because of our advisory expertise, focusing on operating model approaches, overlay considerations, right-sizing functions and determining the appropriate headcount vs. discretionary budget allocation.

Approach

Systematic Resource Needs Assessment

Alexander Group first assessed the client’s current marketing organization structure and jobs to identify areas of misaligned coverage. Concurrent with organizational assessment we also conducted cross-functional productivity assessment across the marketing, sales and product organizations. We also defined the current roles and resources to determine the client’s needs for maximum efficiency.

The project steps included:

Assessed and refined a marketing charter to include visions, objectives and design principles
Evaluating the current operating model to determine appropriate resource needs
Determine regional Marketing function goals, competency and performance measures to increase sales quota increases
Conducting detailed headcount sizing to improve productivity
Estimating over and under-resourcing opportunity areas

Key Findings

Benchmarks Reveal Opportunity Areas

Alexander Group identified several marketing-related findings that supported the client’s goal of increased headcount investment balanced with industry benchmarks.

150-170 FTEs

The marketing team included 156 FTEs, which aligned with Alexander Group’s preliminary sizing estimate of 150-170 FTEs.

4.6% vs. 4.5%

The marketing expense budget was marginally higher than the benchmark, 4.6% vs. 4.5%.

37% vs. 32%

However, Marketing’s headcount vs. discretionary spend was above the benchmark, 37% vs. 32%, indicating the potential to shift spending away from discretionary expenses to improve headcount.

Recommendations & Outcomes

Shift Spend, Socialize New Roles

Based on the spending and FTE findings, project recommendations focused on socializing overlay vs. dedicated resource considerations. Successful implementation required the client to seek alignment for centralization while shifting spend from discretionary to headcount expenses.

Expected results include:

Determining overlay vs. dedicated resource options

Improving productivity and reducing complexity, with less blending of roles

Maintaining adequate resourced functions

Allowing sufficient spans of control between players and coaches

Improving productivity while balancing resource spending was critical for this client to achieve their project goal. Finding the underlying drivers of discretionary expenses created a path for this client to achieve their goal.

Design a Marketing Organization Structure to Align with Growth Objectives

Clearly defined marketing roles and management structure are key to setting up your organization for success. Alexander Group helps leading companies design best-in-class Marketing functions, define the right roles and organize resources to drive market acceleration.

About Alexander Group

Alexander Group understands your revenue growth challenges. Since 1985, we’ve served more than 3,000 companies across the globe. This experience gives us not only a highly sophisticated set of best practices to grow revenue—we also have a rich repository of unique industry data that informs all our recommendations. Aligning product, marketing, operations and finance efforts behind a successful sales organization takes insight and hard work. We help the world’s leading organizations build the right revenue vision, transform their organizations and deliver results.

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