Healthcare in Europe – business as unusual

SHIFT your business to adapt in times of economic austerity in Healthcare

“Growth or Die! Really?

“Is there life in a declining market?”

“is there life in the EU markets?”

“Is there life after growth?”

“What is sexy about the EU markets?”

Market turbulence

Over the last 2 years The European Healthcare market has had less money, its dynamics have completely changed and it will stay that way for a long time.

Less money.

The budgets for Medtech products in the EU are going to decrease – depending on the country – by 2 to 5% per year at least until 2015. The total budget for hospital care will remain flat at best but personnel and inflation dependent expenses will call on an increasing share of the spendable funds.

Macro-economic analysts publish different scenarios but the arithmetic is simple.  By far the largest part of hospital spending in the EU is financed by the Ministry of Health or by government managed Social Security. Even at a time where there is much doubt cast over the effectiveness of austerity programs, real growth in GDP is not to be expected any time soon and unemployment will remain high. As a consequence, budgetary discipline will stay a priority throughout the EU, impacting the HC expenditures.

New rules.

Next to acute cost control, national HC organizations and hospitals have installed and are installing structural changes to cope with the crisis and with what is still to come.  There is an increasing impact of private players (e.g. Spain) , health insurances and reimbursement schemes are being continuously adapted (Holland , Germany,..), procurement processes are reengineered (Germany) and the national health care systems are redesigned (UK) etc.

New competition.

In a market landscape where brand loyalty deteriorates, good enough products successfully compete with innovative solutions and added value services, new entrants can find their way in, settle down  and change the rules of the competitive game.

What to do in these tough economic context?


Effective business management.

All this creates an uncomfortable situation for many business managers who like to present hockey stick charts with double digit growth or who seek for long term opportunities to grasp. Should focus on the following topics on the agenda:

  • Decreasing ASP’s and margin erosion
  • Reduce headcount and redesign market coverage with smaller teams
  • Trim down service levels
  • Cutthroat competition among the market leaders
  • Holding of new entrants
  • Train sales and marketing teams to deal with professional procurement organizations
  • Understand the upcoming changes in ‘hospital management’ priorities
  • Anticipate the involvement by HC insurers

Creating Value

Markets may not grow, but companies still can. Creating value for your customers, optimize processes and do things better, find new ways to segment, to sell, to communicate, to organize.

SHIFT management.

Europe is more than ever a complicated market which deserves priority strategies, creative tactics and proactive moves for all the traditional players. After all Europe, even at a zero growth, represents a huge market volume which makes it worthwhile to maximize the value a company can generate in it. Creating a number of building blocks, a structure of dedicated methods to manage the SHIFT in the Europe of 2013m is essential. This includes:

  • Re- segmentation based on value creation
  • Interactive account profiling
  • Account activity mapping
  • Performance scorecards  for brand performance and brand equity
  • Product-service package designed around the care delivery chains
  • Clinical pathway analysis
  • Value gap analysis


At TforG, our market analyst teams stay in close contact with all stakeholders in various markets to make sure we grasp the full dynamics and match them with the Performance Drivers of the industry.

Our Business consultants constantly work on tools focused on value creation, specialized for this tough environment. Although most of the work we do is highly customized, we have created a wide range of models and methodologies that address the SHIFTS that are going on in Europe and we are ready to adapt them on a business level. We compose the solutions which match the individual needs of our customers.

TforG is using and upgrading all the building blocks from Decision Support since the middle of 2012 and will continue to improve and enhance the SHIFT methodology in the future.

Go to TforG Decision Support page for more information.