Measuring the value of the regulatory intelligence function 1 DIA RI WG – 10 November, 2015 Iain Todd (EU RING - Vice Chair)

Purpose and objectives for today’s presentation 2Measuring the value of the regulatory intelligence function Purpose: Share the RING’s view on measuring the value of RI Get feedback from the DIA RI WG on developing RI value-measures Objectives: Provide an overview of common RI deliverables Recognise the difficulty in measuring the value of intelligence Consider traditional and alternative value measures for RI Consider ‘quantitative’ vs. ‘qualitative’ measures Provide a starting point for further discussion

The RI function and common deliverables 3Measuring the value of the regulatory intelligence function Core RI responsibilityDescription of common deliverable(s) Alerting on changes to the external regulatory environment Monitoring external sources of regulatory information and communicating significant changes (intelligence) to internal stakeholders for assessment and action Managing internal consultations on draft health authority documents Coordinating the gathering of written comments from internal experts Providing responses to colleague ad hoc regulatory queries More extensive research. An evidence-base used by colleagues to develop regulatory strategies and support policy activities Developing and maintaining online systems for managing RI IT platforms/databases – e.g. SharePoint - for storing and facilitating access to regulatory intelligence The RI function detects and analyses changes to the external regulatory environment in order to support strategic decision-making, facilitate compliance and enable earlier responses to emerging regulatory risks The scope of RI responsibilities varies between companies but a number of common deliverables have been identified…

Measuring the value of intelligence 4Measuring the value of the regulatory intelligence function ‘Hard’, quantitative (financial) approaches may not be appropriate for measuring the value of intangible assets such as intelligence The value of intelligence is latent: it is only manifest if its application is linked to a successful outcome. Measuring RI output is necessary but insufficient. The RING favours two approaches to measuring the value of RI: –Identify the desired outcome of successfully applied intelligence and then convert the result into a financial measure (in 1 or 2 steps), or, –Make it obvious to senior stakeholders that the work of RI enables delivery of business goals and is therefore inherently valuable. The first option computes a value; the second emphasises its intrinsic nature The skill of the RI specialist is to recognise the strategic potential of information and communicate its potential significance to the right people at the right time

Conventional and alternative value-measures for RI 5Measuring the value of the regulatory intelligence function Core responsibilityConventional measuresAlternative measures Alerting on changes to the external regulatory environment Number of subscribers to alerts Time taken to communicate change Reduction in staff time spent reacting to unforeseen regulatory issues or correcting submission errors Managing internal consultations on draft health authority documents Number of draft guidelines circulated Number of comments received Number of comments that have led to a favourable change of a guideline (and can be attributed) Providing responses to colleague ad hoc regulatory queries Number of query requests answered Time taken to respond to request Number of regulatory strategies (utilising intelligence) that have a successful outcome Developing and maintaining online systems for managing RI Number of page views Number of document downloads Reduction in redundant data gathering (reduced opportunity cost) The ‘alternative measures’ use the outcome approach and assume that RI is being successfully utilised by the business (the examples are illustrative) Other factors will contribute to a desired outcome but it must be possible to demonstrate RI’s contribution. If it can be shown to be pivotal – great!!

Quantitative vs. qualitative measures 6Measuring the value of the regulatory intelligence function Core responsibilityQuantitative measureQualitative measure Alerting on changes to the external regulatory environment No critical or major findings during audits and inspections Greater awareness of the ‘bigger picture’ – less inward looking regulatory department Managing internal consultations on draft health authority documents Fewer regulatory hurdles to derail a development programme Industry as trusted partner - better engagement with regulators Providing responses to colleague ad hoc regulatory queries Potentially faster review and approval times Enhanced reputation amongst patients and healthcare providers Developing and maintaining online systems for managing RI Reduced opportunity cost from re-work and redundant data gathering Emergence of hidden opportunities (from data mining/‘predictive analytics’) Science and business tend to favour quantitative approaches but the value (or cost) of human behaviour and its consequences may be better captured with qualitative measures... Collaboration is key. True value comes from working together in an optimal way

Poll question #1 7Measuring the value of the regulatory intelligence function What approaches are recommended for measuring the value of the RI function and its deliverables? A) Convert alternative (outcome) measures into conventional financial measures in one or two steps B) Demonstrate to senior stakeholders that the work of RI is inherently valuable C) Develop a complex algorithm that precisely defines the contribution the RI function makes to key strategic decisions D) A an B E) None of the above

Your view 8Measuring the value of the regulatory intelligence function To what extent do you agree with the following statement: In today’s budget-constrained environment, the need for ‘enabling’ functions, such as RI, to precisely define their value in quantitative terms, e.g. how they have contributed to the ‘top-line’ is becoming increasingly necessary in order to justify their existence... A) Strongly disagree B) Disagree C) Neither agree nor disagree D) Agree E) Strongly agree

Conclusions and next steps 9Measuring the value of the regulatory intelligence function Conclusions: The precise (monetary) value of the RI function and its deliverables are difficult (and perhaps impossible) to measure Rather than adopt complex, quantitative methods, it might be better to demonstrate the inherent value of RI. Align RI goals to business goals. The ability to transform information into intelligence is an asset (and skill) in its own right and should be recognised as such If an organisation is intent on maximizing its ‘information’ assets, it should accept so-called “softer” approaches to measuring value Where does RI go next? Be ready - continue to think about and discuss RI value-measures and performance indicators, as this may be the ‘direction of travel’ Don’t waste time developing a complex calculus if senior management have accepted the ‘inherent value’ argument

Your feedback and experience 10Measuring the value of the regulatory intelligence function Is there an enterprise-level strategy for measuring and maximising the value of information assets and knowledge-orientated functions in your company? YES NODON’T KNOW Do you have a specific method in place for measuring the value of RI deliverables – e.g. ‘voice-of-the-customer’ surveys? YES NO In the last 3 years, have you had discussions on or been asked to develop specific KPIs/value measures for RI? YESNO