CIO Competencies Are Evolving to Capture Innovation Opportunities of Digital Revolution
DANBURY, Febuary 03, 2016 – Conn. (BUSINESS WIRE) More than 80 percent of leading life sciences companies have created new digital and innovation leadership roles to capitalize on the information technology transformation in healthcare, with nearly half hiring new chief information officers during the past three years, according to new research issued today by the IMS Institute for Healthcare Informatics. The rise of mobile, cloud, predictive analytics and other digital innovations offers new opportunities for advancing patient care as companies launch innovative products at a more rapid pace and in more therapy areas. These dynamics, along with spending and operational constraints, require life sciences CIOs to expand specialized IT knowledge and skills within their organizations, and to play a more strategic role in driving commercial success through digital transformation.
The study, New Strategic Information and Technology Roles in Life Sciences Companies, includes a proprietary Information and Technology Transformation Scoring framework (ITTS) to assess progress among the top 50 global life sciences companies. ITTS tracks five areas of technology conversion: Innovation/Disruption, Organizational Transformation, Big Data/Analytics, Infrastructure, and Future of Work. The study was produced independently in collaboration with Egon Zehnder, a leading global executive search and talent management firm.
“While most life sciences companies have centralized their IT functions to drive operational gains, they have been slow to achieve the breakthrough transformation that’s possible by capitalizing on today’s technologies,” said Murray Aitken, IMS Health senior vice president and executive director of the IMS Institute for Healthcare Informatics. “Of the companies we assessed using our ITTS framework, just 15 percent are fully capturing the value of the digital revolution.”
Opportunities exist for CIOs to play a more strategic role in advancing the technology transformation within life sciences companies.
“Tech and digital innovations are becoming a core part of the value proposition for life sciences. And yet, unlike many other industries, the skills required to fully deliver on those innovations are not native within this sector. There is a unique opportunity for CIOs to fill the missing skill gap and become core enablers of their respective companies’ strategies,” said Alain Serhan, co-leader of Egon Zehnder’s global Digital Health Initiative.
Highlights of the study include:
- Technology transformation is underway within all life sciences companies, across varying strategic and operational areas, and at different rates. Large companies outperform their medium-sized competitors on average across all elements of the ITTS assessment. Of the companies surveyed, 15 percent are considered market leaders, demonstrating significant progress on both strategic and operational dimensions. On average, 85 percent of companies with centralized IT functions have achieved a higher level of technology transformation—as have companies that use cloud-based technologies for more than 25 percent of their software needs.
- While IT departments are embracing analytic tools that reduce complexity, advanced predictive and prescriptive capabilities remain underused. Within sales and marketing functions, 80 percent of companies assessed now have systems in place that leverage visualization tools, and more than half have a multichannel marketing strategy in place for their North America and Europe operations. However, fewer than 10 percent of life sciences companies deploy systems that apply both predictive and prescriptive capabilities to guide decisions.
- As leadership in new IT functional areas is recognized as increasingly critical to success, CEOs are hiring new CIOs and establishing digital and innovation roles. Nearly half of the life sciences companies assessed have CIOs who have been in place less than three years, and 70 percent in place fewer than five years. In small companies, more than 40 percent of all CIOs were hired within the past year. Companies with CIOs having a tenure of less than five years outperform on the ITTS framework overall, especially in the key areas of Innovation/Disruption and Big Data/Analytics. More than two-thirds of today’s CIOs were hired from outside the company, with external hires ranging from 82 percent for small companies to 52 percent for larger organizations. Despite the critical role of the CIO in business transformation, fewer than one in four are part of their company’s executive team. Within large life sciences companies, just one in seven CIOs serves on the executive team.
- CIOs remain in the best position to lead technological innovation, but require new digital competencies. The CIO role has narrowed in scope in most life sciences companies as responsibility for areas such as R&D bioinformatics, genomics and Real-World Evidence have moved to other parts of the organization. And, more than 80 percent of companies have established new digital data and innovation positions that challenge the traditional CIO role. With new “digital” competencies viewed as key for success, assessments by CEOs of CIO candidates focus on a combination of both core and digital competencies. The core competencies of strategic orientation, results orientation, team leadership and collaboration/ influence remain essential. In pursuit of future digital leaders, CEOs also are seeking candidates with strengths in consumer centricity, digital fluency, data orientation, adaptability and change leadership.
The full report, including a detailed description of the methodology, is available at www.theimsinstitute.org. It also can be downloaded as an app via iTunes at https://itunes.apple.com/app/ims-institute/id625347542. The study was produced independently as a public service, without industry or government funding.
About the IMS Institute for Healthcare Informatics
The IMS Institute for Healthcare Informatics provides key policy setters and decision makers in the global health sector with unique and transformational insights into healthcare dynamics derived from granular analysis of information. It is a research-driven entity with a worldwide reach that collaborates with external healthcare experts from across academia and the public and private sectors to objectively apply IMS Health’s proprietary global information and analytical assets. More information about the IMS Institute can be found at: http://www.theimsinstitute.org.
About Egon Zehnder
Since 1964, Egon Zehnder has been at the forefront of defining great leadership in the face of changing economic conditions, emerging opportunities and evolving business goals. With more than 400 consultants in 69 offices and 41 countries around the globe, we work closely with public and private corporations, family-owned enterprises and nonprofit and government agencies to provide board advisory services, CEO and leadership succession planning, executive search and assessment, and leadership development. For more information visit www.egonzehnder.com and follow us on LinkedIn and Twitter.
About IMS Health
IMS Health (NYSE:IMS) is a leading global information and technology services company providing clients in the healthcare industry with end-to-end solutions to measure and improve their performance. Our 7,500 services experts connect configurable SaaS applications to 10+ petabytes of complex healthcare data in the IMS One™ cloud platform, delivering unique insights into diseases, treatments, costs and outcomes. The company’s 15,000 employees blend global consistency and local market knowledge across 100 countries to help clients run their operations more efficiently. Customers include pharmaceutical, consumer health and medical device manufacturers and distributors, providers, payers, government agencies, policymakers, researchers and the financial community.
As a global leader in protecting individual patient privacy, IMS Health uses anonymous healthcare data to deliver critical, real-world disease and treatment insights. These insights help biotech and pharmaceutical companies, medical researchers, government agencies, payers and other healthcare stakeholders to identify unmet treatment needs and understand the effectiveness and value of pharmaceutical products in improving overall health outcomes. Additional information is available at www.imshealth.com.
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