How Merck’s CIO Looks at Technology and Startups (Part 2)

This post continues our conversation with Clark Golestani, the CIO of Merck, #58 on the 2012 Fortune 500 list. His IT organization is over 10,000 people and operates in over 140 countries. Given the framework we described in the previous post, Clark offers some tips for startups selling software to Merck and other large enterprises. Additionally, he has provided a whitepaper with Merck’s guidelines for cloud-based services in regulated industries, which should be very helpful to startups selling into them.

Top 3 ways for start-ups to approach Merck and other large enterprises

  1. The first questions for an entrepreneur to ask are … does the enterprise have a “sense” for new technology? Do they have a team or person that scouts for new ideas? And have they been early adopters of new products (which ones)? If the answer is no to all of these questions, then Clark recommends that startups not waste time with these companies and focus instead on some of the more visionary companies. To emphasize the point, he highlighted how his team is building a relationship with NetFlix, who has been a very early adopter of some of the most cutting edge cloud technologies.
  2. The second suggestion is for startups to look for CIOs or IT leaders who are engaged with external advisory boards and companies with internal innovation centers. Clark has been involved with Sierra’s CIO Board for over 7 years and said that he has been introduced to many new innovative technologies through this engagement as well as from his interaction with his fellow CIOs on the board. He also thinks that the internal innovation centers created by many financial institutions and companies like TCS (Tata Consultancy Services) offer startups quicker access to mainstream IT. Clark recently hired a senior executive to do just this for his team.
  3. Clark encourages entrepreneurs to proactively think about exposure through the various technology evaluation reports from industry analysts (Gartner, Forrester, etc.) or trade publications (CIO Magazine, eWeek, etc.) His team is a big consumer of this information and uses it both for initially scouting new technologies and then validating companies that Merck is evaluating.

Common mistakes made by entrepreneurs

According to Clark, entrepreneurs need to think through the business case through the lens of enterprise IT. The biggest question that they need to ask themselves is “what’s the business value for the enterprise to move forward.” As he mentioned in our previous post, any startup has to anchor their story around one of Merck’s key business issues.

The second topic he highlighted was that it’s usually (caveat) much better for startup companies to solve an existing problem vs. just having an interesting new mousetrap. IT is ruthlessly driven by reducing costs and driving global scale, and most organizations are hard-pressed to evaluate brand new technologies (see #1 above).

Specific areas of interest to Merck

Clark then shared his perspective on the areas of enterprise IT that are of particular interest to Merck. While he offered a lot of deep insights, I have tried to briefly summarize the key topics below.

Cloud: Clark’s experience is that making things work in the cloud is not trivial. According to Clark, “to get the kind of fault tolerance and resiliency of cloud applications requires a level of application architecture that most IT organizations don’t have today. There are opportunities to make it much easier to leverage the cloud, and companies who are able to deliver on this will get significant traction. For regulated industries there are additional considerations that need to be considered.  Clark’s organization has published a whitepaper for cloud-based services to follow.

Mobile: Security on smartphones is becoming an area of significant concern to Merck. Current MDM (mobile device management) solutions are only adequate to track and wipe devices, but not enough to ward off some of the new threat vectors. Clark is very focused on being able to manage and secure data on mobile devices in the new BYOD world.

Social: Surprisingly for an enterprise in a highly regulated industry, Clark said that social technologies are moving very rapidly forward both internally and how they engage with customers. He is constantly looking for new ideas in this area and also needs to figure out how this works with industry needs like regulatory requirements.

Big data: Big data, storage and analytics are critically important to the life sciences industry. Merck, like most pharmaceutical companies, consumes vast amounts of information and generates a ton of information too. Clark is always looking for ways to leverage new technologies in these areas. However, he believes that vertical-specific solutions are more likely to succeed in this sector.

The perspectives provided by Clark Golestani, as the CIO of a F100 company, have already been invaluable to a number of startup companies. We will continue to have a number of CIOs and CTOs from the Sierra Advisory Board share their views on an ongoing basis in our audaCIOus blog.