Preparing the Next Generation of Chief Medical Officers in an Evolving Landscape

As the healthcare industry rapidly evolves and top medical talent becomes scarce, the MedTech industry is facing a shortage of experienced chief medical officer (CMO) successors. To successfully meet the clinical and business demands of this complex role, CEOs and current CMOs must begin proactively preparing the next generation of medical leaders.

To understand what makes CMOs successful, Russell Reynolds Associates interviewed a group of eight distinguished CMOs across the global MedTech sector. From this, we created a comprehensive picture of the current state of CMOs, and identified key growth and development areas for aspiring CMOs.

While there is no single set of competencies that guarantee success in the CMO position, we found that organizations consistently seek leaders with clinical expertise, the ability to foster effective collaboration across functions, strong business acumen, enterprise-level thinking, effective executive communication skills, and digital literacy when looking for their next CMO.

The current chief medical officer landscape

The chief medical officer role varies substantially across organizations, but its main functions remain consistent: be the patient-centric voice internally and lend credibility to the organization’s vision externally. Successful CMOs possess the ability to translate and balance patients’ clinical needs with business demands and strategic priorities.

This requires CMOs to work closely with the CEO and other C-suite executives. Therefore, most CMOs prefer a traditional business structure in which they directly report into the CEO. This allows them to defend their clinical positions and ensure that their objectives don’t become deprioritized by other members of the executive committee.

However, there are alternative organizational structures. The CMO may also report into a CTO or R&D leader. This structure tends to be most effective in organizations where the CMO’s role revolves primarily around day-to-day clinical issues, rather than broader business strategy.

Overcoming common challenges for chief medical officers

Regardless of reporting structure, we uncovered a set of common challenges new CMOs and next gen leaders face, many of which are tied to their prior experience. To understand which key areas aspiring CMOs must develop, we have to view these challenges as necessary learnings:

• Don’t assume academic success translates in a business environment: CMO leaders often transition from a physician role to being a strategic partner in a corporate environment, where they must understand all aspects of key decision making beyond their medical background. Over half of current CMO leaders come directly from academia or were a practicing physician prior to taking their CMO role or the role that led them to the CMO position (Figure 1). Success in a hospital setting, however, will not automatically equal success as a CMO, and making this assumption can result in reactive behavior and loss of focus.
  
  
• Don’t overcompensate with a sales-oriented approach: New CMOs who come into their role from a non-corporate background tend to overcompensate for their lack of experience by adopting a sales-oriented approach. However, maintaining credibility with patient safety should be their primary focus. Nevertheless, the other extreme of sacrificing business needs and profitability in the name of scientific advancement will have an equally detrimental outcome. It is crucial for CMOs to learn how to build relationships with stakeholders, navigate the matrix environment, and balance patient safety with business objectives.
  
  
• Don’t adopt a top-down communication style: CMOs with a background in clinical development are often more accustomed to a top-down communication style. Instead, they should focus on building consensus and conveying a message concisely. Effective teamwork and the ability to lead both clinical and non-clinical teams is critical to a CMO’s success.

Route to the Top: Career Pathway of the CMO

_{Source: RRA Analysis of the 50 highest-revenue MedTech CMOs, 2023}

Parsing the best from the rest: what best-in-class chief medical officers bring to organizations

To help next generation medical officers overcome these common challenges, Russell Reynolds Associates spoke with industry leaders, who highlighted the following key qualities and skills that differentiate the best from the rest:

• Maintain and demonstrate value: A great CMO should be capable of showcasing the value they bring to both internal (including cross-functional) and external shareholders. CMO positions can vary across different large strategic companies, so clarifying the goals and defining what success look like for the current state of the business is critical.
  
  
• Demonstrate high-level business acumen: CMOs need a strong understanding of the intersection between unmet needs, the science behind those needs, and the business.
  
  
• Champion a patient-first strategy: Medical leaders must maintain a patient-first approach and serve as a guiding light for the company. Great CMOs have the ability to adapt outside their medical expertise and engage with various stakeholders to evangelize their strategy.
  
  
• Foster external relationships: Great CMOs are skilled in building and maintaining excellent relationships with external stakeholders. However much time a CMO spends with customers, it should be more: the currency of a CMO is representing the voice of the provider and patient.
  
  
• Advance digitization efforts: CMOs need to be proficient in using technology and innovation to drive workflow for providers, add value to healthcare institutions and insurers, and demonstrate the financial feasibility of such models. Medical leaders must be well-versed in utilizing clinical data effectively to improve value and healthcare delivery. Lastly, CMOs must make an effort to stay up to date with how digital trends and developments will affect their portfolios.
  
  
• Demonstrate people leadership skills: Being an effective manager is a significant differentiator for CMOs. Success often relies on building and leading a competent team to accomplish great things. Demonstrating humility, as well as a mature and authentic leadership style empowers the team and drives success.

By embodying these qualities, a CMO can excel in their role and make a significant impact within the company.

Deep dive: the growing importance of digitization in MedTech

There is no denying it: digitization and AI will be an integral part of the MedTech industry’s future. From developing new products and technologies, to utilizing patient data more efficiently, CMOs will need to learn how to utilize this tool ethically and effectively. One of the most important tenants of being a successful CMO is mastering new technologies to drive better outcomes for the patients and provider.

Embracing new technologies and practices may, naturally, pose some challenges. Based on our conversations with industry leaders, we identified a key themes to tackle the transition:

• Become familiar with the technology and its processes: How are these tools developed and what new practices are emerging around them? What are they primarily used for and what gaps will they eliminate. A CMO should always continue to learn and aim to be a part of conversation earlier in the product development lifecycle. It is imperative to build a strong relationship and engage in a dialogue with the technical team and chief digital officer.
  
  
• Know how technology drives value for patients: How can we study and utilize data analytics, health approaches, risk sharing, etc. to improve the value of the products we provide? The CMO should always know what the exact value proposition of the technology for their customer is.
  
  
• Set KPIs to cover current gaps: Creating a dialogue around these new processes will help you identify points of friction and continue to improve and iterate on your products.
  
  
• Know the evidence: It is crucial for the CMO to know what evidence they need to provide to prove the business case of these new technologies.

The roadmap towards digitization may look different at each organization, but a clear approach can help smooth the transition and guarantee success.

Authors

Victoria Fibig is a member of Russell Reynolds Associates’ healthcare knowledge management team. She is based in New York. 
Sarah Flören leads Russell Reynolds Associates’ Healthcare knowledge management team. She is based in Amsterdam.
Nick Henderson is a senior member of Russell Reynolds Associates’ Medical Devices, Tools, and Diagnostic practice. He is based in Dallas. 
Jordan Smith is a member of Russell Reynolds Associates’ Medical Devices, Tools, and Diagnostic practice. She is based in Dallas.