By Dave Williams, CIO, Merck Animal Health
Business value is the only reason we in IT exist. The skills required to deliver value in today’s dynamic environment are more wide ranging than ever, resulting in a new success formula for IT professionals. I believe that my organization, comprising talented people with the right mind-set, has validated this new formula by generating tremendous value for Merck Animal Health, a $3.4 billion business with 6,500 employees worldwide.
Success in IT was once based on a single competence: technology expertise. Today, success requires three broad competencies. Technology, and especially data, expertise remains critical, especially given the rapid innovation in our industry. But a deep understanding of the business and its processes is also needed, in order to earn IT a seat at the table with its business partners. Finally, the ability to lead change — change related to the deployment and adoption of new technologies, processes, and even business models — has become indispensable. Only when all three come together can IT deliver real value to the business.
The Right Mind-Set
Not everyone in the IT organization is proficient in technology, business knowledge, and driving change. It simply isn’t practical to assume that every person in the IT organization is going to possess that triumvirate.
As an IT leader, it is my job to seek out individuals who possess certain aspects of those capabilities and bring them together. I want that hard-core tech guy who can make the best solution better, but if I don’t have someone with the consultative and relationship building skills to get the business to adopt that technology, we won’t deliver any return. We must master that formula every time.
Just having a team with complementary skills won’t lead to success in IT, though. To deploy those skills effectively, everyone on the team needs a new mind-set.
Traditionally, IT has been hierarchical. You have a job description — that’s what you do. You don’t know what’s happening to the left or right of you. This is an ineffective model that leads to inefficiencies and sub-optimal solutions. On my team, each person invests time building networks of contacts, across organizational boundaries and without regard to hierarchy. It is these networks that enable us to create value for the organization.
It’s also important for members of our team to be able to deal with intense ambiguity. With the rapid pace of change in technology and in our industry, we need IT professionals who can adapt, be flexible, and make rapid (and informed) decisions.
Perhaps most important, I look for people who know how to market and sell our IT services and solutions and are intensely focused on our business partners. We can’t sit in our offices and wait for business partners to come ask for IT solutions. It’s our job to market and sell IT solutions that can drive value.
With this mind-set, a new one for most IT professionals, we can leverage the three essential elements of today's IT success story.
Technology and Data Expertise
Having deep technical and data expertise is obviously a critical success factor for any organization. But that isn’t easy, considering the rapid pace of technology change and the complexity of our business model. If we don’t stay current on the latest technologies and understand the data structures that drive our business, we’ll struggle to deliver solutions that generate value.
To be sure that doesn’t happen, we focus on three things: platform, partners, and the cloud.
At Merck we define a platform as “a set of highly related information and technology capabilities that, when combined, provide economic value to Merck’s business through faster speed to market and reduced unit costs.” Taking a platform-centric approach in Animal Health IT enables us to focus our resources on a specific set of technologies and data sources that drive the greatest value for our business. Our internal employees have deep technical knowledge in the platforms and processes we support, which include ERP, analytics, commercial, and R&D. Mature platforms, along with our deep technical knowledge and our understanding of the data that drives the business, is a powerful combination.
External partners are a critical component in our operating model. We recognize that a lot of innovation happens outside the four walls of Merck. We rely on our strategic partners to help keep us up-to-date on the latest innovations and share their views on how those innovations can create value for our business. Our partners also help us accelerate our learning curve as it relates to the evaluation, selection, and deployment of new technologies. Solutions drawn up on a whiteboard rarely translate easily to the real world. The positive and less-than-positive experiences our partners have had deploying new technologies outside of Merck help us accelerate time to market and develop high-quality solutions inside of Merck.
Cloud means many things to many people. For Merck Animal Health, we focus mainly on the platform-as-a-service type of cloud. PaaS offerings such as Veeva and Salesforce.com enable our team to shift our focus from coding and testing activities to integration and adoption activities, which we feel drive greater value and accelerate time to market.
A platform-centric approach, leveraging our partners, and utilizing the cloud enable our organization to stay current on the most important technologies — and focus on our business.
While there isn’t a single playbook for developing business knowledge, I ask our team to do three things — develop strong business partner relationships, get out into the field, and know our products.
When I joined Merck Animal Health, in 2012, the first thing I did was meet with as many business partners as I could, in every business function, to understand their challenges and opportunities. With each interaction I learned more about the business and how IT can bring value to the table. It sounds very basic, but we often lose touch with our business partners over time, which results in solutions that miss the mark. Imagine the cumulative benefit of having everyone in the IT organization meet one new business partner a month! On the contrary, imagine how challenging it would be to deliver value if you’re not constantly in touch with those partners and their evolving needs.
We go into the field to experience things as our partners and customers do. You can’t achieve the required level of business knowledge just by sitting in the office. I encourage everyone in our team to get out and spend time with our business partners and customers. If someone works in ERP they need to spend time at a manufacturing plant or distribution center. If they’re supporting our commercial business, they ride along with sales reps and visit customers. I’ve had the opportunity to meet veterinarians in several countries and visit hog farms, dairy farms, and cattle feed lots. Each visit increases my knowledge of our industry and customers, and I usually come back with several new ideas.
Finally, it’s important to know your company’s products, services, and go-to-market strategies. Many of our IT solutions are designed to help our sales and marketing teams better connect with our customers. If you don’t have a solid understanding of your products and how we sell them, it’s tough to develop solutions that will add value.
As IT professionals we often fall into the mind-set that “go live” of a new platform or application is the finish line. In reality, it’s the point at which you’ve spent the majority of the money but have received no value. Our organization focuses intently on leading change and driving adoption of new technologies and solutions to ensure we realize the “R” in ROI.
There are three things we focus on relative to leading change. First, there must be a clear value proposition for the change. We articulate this in a formal business case that clearly identifies the value in terms of the P&L, the balance sheet, or both. Second, the solution must be intuitive and easy to use. The easier the solution, the more likely users are to embrace it. When’s the last time you had to go to training to learn how to use an iPhone app? Third, we ensure our “change agents” have the necessary soft skills and business knowledge to partner with the business on adopting the new solution. Change agents who know the business, know the solution, and have the ability to communicate, influence, and partner with our users are usually successful.
Creating Business Value
These three competencies aren’t worth much unless they create business value for Merck.
One of our biggest opportunities to create value involves increasing our market share in the flea and tick segment, one of the largest segments in the animal health market.
In 2014 we launched BRAVECTO, a 12-week chewable flea and tick treatment for dogs. Understanding the market, the flea and tick segment, and our target customers enabled us to support the launch of BRAVECTO with a new multichannel marketing solution. This solution, based on the Salesforce Marketing Cloud, enabled us to connect with vets and pet owners via digital marketing campaigns. In the past, we would have relied on our field sales force, but this new capability extends our reach and improves the frequency with which we’re connecting with customers. We also have an ability to measure the effectiveness of our campaigns in near real time.
The success of this project ties directly to the variables in our success formula:
Technology & Data Expertise. We selected Exact Target (now known as the Salesforce Marketing Cloud) because it’s a cloud-based platform with robust functionality that connects with Veeva, our CRM platform. We also focused on ensuring we had high-quality customer data to maximize e-mail deliverability, opens, and click-through rates.
Business Knowledge. To be credible with our business partners and maximize our contribution to this initiative, it was important that we were familiar with the market, product, and digital marketing best practices.
Change Leadership. Multichannel marketing is a new capability for many of our business partners, so it can be a bit intimidating. Our approach here was to have the technology and business teams sit side by side and travel this change journey together. If you joined one of the team meetings it would be hard to tell who was in an IT function and who was in a Marketing function — and that’s how I like it.
Fast-forward to today and my biggest problem is that I don’t have enough capacity to meet the incredible demand for multichannel marketing coming from our global markets. They’ve seen the impact it can have on our top line, and they’re anxious to move faster. This is a good problem to have and a direct reflection on the talent of the team.
We remind ourselves daily that business value is the only reason we in IT exist. As long as we remain focused on developing our three main competencies, I’m confident we’ll continue to deliver real value.
IT success used to depend just on technology expertise. But to deliver real business value, IT organizations must now also have a deep understanding of the business and its processes and an ability to lead change in technologies, processes, and even business models.
Acquiring these three competencies—technology and data expertise, business knowledge, and the capacity to drive change—requires a new mind-set. Whereas IT used to be a rigid hierarchy, it now must include networks of relationships that span boundaries. Relationships with internal and external partners, and with customers, are especially crucial for generating business value.