By Peter Tzefronis and Jake Park-Walters, Clarkston Consulting
The COVID-19 pandemic has caused the life sciences industry to innovate and adapt to unpredictable circumstances. Even as individuals progressively shake off fears, supply chain issues and labor shortages exacerbate other important issues.
Clarkston Consulting recently conducted a CIO Market Study1 aiming to better understand the current priorities, challenges, and goals of upper-level information technology (IT) professionals. Across various industries, including life sciences, a variety of C-suite (CIO/CISO/CTO/VP) IT executives at large companies ($350M+ revenue) were surveyed. Below, we outline some of the survey’s results and high-level trends.
The pandemic forced IT departments to give employees access to remote work accommodations. For many life science firms, this meant that cybersecurity became a larger threat. When employees work remotely, they most likely use a Wi-Fi connection that is less secure, especially if connected to a public network. Furthermore, the use of personal devices, weak passwords, and inadequate backup systems all lend themselves to potential cybersecurity issues. Unencrypted data may easily be intercepted by cybercriminals, leading to sensitive information breaches.
The CIO Market Study found that 63% of those surveyed report their company’s most critical security challenge comes from external threats such as malware, viruses, ransomware, and phishing. Furthermore, many of the changes made by IT departments during the pandemic are expected to remain permanent. Those in the survey who had not seen remote working revert to pre-pandemic levels, believe that this work arrangement will never revert. As employees decide to embrace remote work for the long haul, IT professionals recognize the need to accelerate data security initiatives.
Firms in the life sciences industry are making commitments to protect patient information, clinical trial data, and confidential internal documents as threats become more prevalent. In its recent Digital Defense Report, Microsoft even highlighted the increased ability of cybercriminals to exploit home devices being used for business purposes. As such, 83% of surveyed CIOs plan to focus on security management in the upcoming year.
The Growth Of IT
Even as current IT labor shortages are improving, hiring managers are still facing significant difficulties. With 115,000 current IT job postings across the U.S., the field is certainly experiencing strong demand post pandemic. Increased digitization across the life sciences industry, and other industries, is a driver for the IT labor needs. As services and data become tied to the cloud, artificial intelligence (AI) and machine learning become increasingly part of everyday processes, and as an organization’s digital presence becomes more pivotal, life science firms need professionals to develop and manage it.
Consequently, the report finds that just over 80% of respondents expect their IT budgets to increase next year and virtually all of the remaining expect their budgets to remain the same. Only one of the 30 respondents expects a reduction. This increase in budget can not only be attributed to the increased need for labor but also to the research and implementation of the aforementioned technologies.
AI and machine learning are rising fixtures in clinical trials, data analysis, and marketing for biotech and pharmaceutical companies. Intelligent software that progressively becomes better is key to efficiency and cutting costs. IBM Watson, an artificially intelligent computer system, was recently able to perform data analysis and identified specific treatments for over 1,000 patients with tumors. This is a significant development in the life sciences industry because of the potential for efficient and accurate data analysis within operations that consume enormous amounts of time and resources. AI’s ability to automate administrative tasks can help cut costs, reduce time to completion, and enable organizations to reallocate staff to meet shortages and focus on higher-value activities.
The growth of information technology divisions and new investments reported by CIOs are complementary. Fifty-three percent of those surveyed report investing in cloud technologies in 2022, 30% in data analytics, 10% in cybersecurity, and 7% in AI. IT divisions work directly with each of these new investments across research, implementation, and management. Each new investment is significant for a number of reasons and parallels broader life sciences industry trends.
Cloud technology is essentially the use of the internet to retain and access data infrastructures. This means that servers, databases, software, storage, and other analytics are all accessible via a floating “cloud.” The importance of cloud computing lies in its efficiency and economies of scale. Documents, data, and information are readily accessible from anywhere with virtually limitless levels of capacity that grow with a company’s needs. The service was prevalent prior to the pandemic but is nearly mandatory now due to the inability for certain workers to access information via a physical space. The life sciences industry, especially, has a constant flow of information regarding patients, trials, and research that needs to be readily accessible. Consequently, both small and large firms have adopted the technology.
Increased investments in data analytics are a tell-tale sign that technology is improving. Firms are able to generate and harvest exponentially larger quantities of data with the rise of supercomputers, wearables in clinical trials that are constantly transmitting to a firm’s Internet of Things (IoT) network, and instantaneous communication channels. Consequently, larger investments are required to store, organize, and synthesize the data into information that is actionable.
AI and machine learning is certainly an avenue for faster and more efficient data processing. Firms in the life sciences industry recognize its potential and have begun to adopt innovations like IBM Watson. Other software giants like Google are also ramping up innovation. For example, Google’s Cloud Healthcare API uses AI to help firms make more informed decisions regarding patients. The interface uses data from patient health records and presents appropriate solutions. Inconsistently, however, the report finds that only 7% of interviewed CIOs were investing in AI, although it must be noted that this is across a broader array of industries.
Finally, two-thirds of those surveyed have invested in programs to address their team’s mental and well-being needs. This follows universal trends that give emphasis to an employee’s healthy state of mind. For example, Pfizer partnered with Thrive Global4 to help employees focus on their own wellness and gave them an extra paid wellness day. Equally significant, life science firms are also focusing on research and development for mental health. Johnson & Johnson is focusing on a more precise treatment for depression and smaller firms like Pear Therapeutics and Lobe Sciences are developing treatments for cognitive disorders. Investing in mental health and well-being is a trend that gained traction in part from pandemic difficulties with remote working but appears to be here to stay.
Clarkston’s CIO Market Study uncovered a number of trends, including the increased focus on security management by IT professionals, strong growth in IT divisions because of intense digitization, and new investments in areas that complement digitization. Life science firms are certainly innovators in data collection and analytics, as shown by numerous new innovations. Ultimately, the pandemic has reshaped how life science firms operate and will influence how they develop over the next few years.
- Tzefronis, P. (2022, June 6). 2022 Clarkston Consulting CIO Survey Summary Report. Clarkston Consulting. https://clarkstonconsulting.com/insights/2022-cio-survey/
- Gaskell, A. (2022, March 2). The Cybersecurity Challenges of Working From Anywhere. Forbes. https://www.forbes.com/sites/adigaskell/2022/03/02/the-cybersecurity-challenges-of-working-from-anywhere/?sh=2e6d7be614cc
- Mearian, L. & Gruman, G. (2022, June 6). How many jobs are available in technology? Computerworld. https://www.computerworld.com/article/3542681/how-many-jobs-are-available-in-technology.html
- Expanding Colleague Health and Wellness Support with New Resources. (2021). Pfizer. https://www.pfizer.com/sites/default/files/investors/financial_reports/annual_reports/2021/story/colleague-health-and-wellness-support/
- Harnish, A. (2022, May 23). Innovating to Improve Mental Health Across the Globe. Johnson & Johnson. https://www.jnj.com/innovation/how-johnson-johnson-innovating-to-improve-global-mental-health
About The Authors:
Peter Tzefronis is an associate partner at Clarkston Consulting. He has more than 20 years of experience leading large-scale transformational IT initiatives for clients in the consumer products and life sciences industries. In addition to transformational IT initiatives, he has specific experience in developing comprehensive IT strategies, supporting sell side divestiture transactions, performing IT governance audits, and developing business cases for investments leveraging process improvements and technology. He received his MBA in finance from the Weatherhead School of Management at Case Western Reserve University and earned a B.B.A. in accounting from Georgia State University.
Jake Park-Walters is an undergraduate student at Duke University studying economics with concentrations in finance and history. He has interests in consulting, business, and emerging technologies. As part of his role at Clarkston Consulting, he writes a variety of content for the life sciences, consumer products, and retail industries.