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Digital Transformation at Bayer

May 18, 2015 by Andreas Schmitz 7

With a crowd platform, in-memory DNA analysis, and a digital council that oversees the responsibilities of the CDO, pharmaceutical giant Bayer strives towards diversity and new ideas.

Daniel Hartert, CIO of Bayer Group and director of Bayer Business Services, talks about their digital transformation.

Q: You have had Jessica Federer on board as a colleague at group level dealing with the digital agenda of Bayer for over a year now. Will CIOs become obsolete in this new age of digitalization?

A: There is no conflict, in my opinion. Jessica Federer leads and organizes the digital council of the Bayer Group. Head of innovation Kemal Malik is chair of the council. Other members are representatives from the business units HealthCare, CropScience, and Bayer Business Services.

It is the responsibility of the digital council to summarize and direct the company’s digital activities, as well as to find out what can be done on company level to strengthen our business concerning digital activities. Seeing as the portfolio is very different for the two areas, it would be unreasonable to make the council handle the entirety of the company’s digital affairs. The requirements from the fields of CropScience, Pharma, Consumer Care, and Animal Health are too diverse for that.

On the other hand, there should definitely be company-wide guidelines in place where they are necessary. What I have in mind here is a joint platform for the data, a joint infrastructure for both internal and consumer connection purposes. This would also require having the right competencies in digital technologies and business models at our disposal. I am talking about enabler elements. After all, Bayer has around 120,000 employees who all need to think and act on a digital level in the future.

How far has the digital transformation progressed in Bayer?

This topic is receiving so much attention nowadays that it seems whoever is not a part of it has already lost out. It reminds me of the start of this century, when everyone deemed it necessary to buy their pencils on the Internet. However, Bayer has always been a part of new waves in technology in the past. It is one of the reasons why Bayer is so successful.

Are there any specific projects that would have been impossible without the digital developments of the last few years?

That would be the omics project in the fields of research and development. In the past, research on molecules was done in a traditional manner here. But in the IT4omics project, the IT department provides the scientists with algorithm software. Now we can use the procured data for simulations and as enablers to partially predict the effects of new molecules on the human body, among other things.

Contrary to expectations from traditional IT, development, testing, and production cycles are no longer necessary. These days, we work with very large amounts of actual data in real time. This will revolutionize the world of Life Science research in the next few years.

In addition, we are working towards crowd sourcing under the initiative Bayer Grants4Apps, in which we encourage startups to design new apps for health – without a formal briefing. This is how the Pill Reminder app that reminds patients to take their medication was created. Any external developer or startup company with a similarly good idea is welcomed into our local facilities. There they can work directly with our scientists for half a year and profit from the knowledge of our experts. Besides all this, we also offer them financial support.

In-memory is essential for personalized medicine

Can you name any examples of new business models that were made possible through SAP technology?

The in-memory technology of SAP HANA was a great breakthrough for us. We worked with SAP at the Hasso Plattner Institute in Potsdam, the birthplace of SAP HANA, and also in Palo Alto, California, because it was evident to us that digitalizing research and development processes would completely transform these fields.

Take, for example, the effects of medication. What works well for some does not work so well for others. By analyzing a person’s DNA characteristics, we can differentiate between the various profiles early on and use the studies to adapt our medicine better to the individual patients. Such a feat was unimaginable 15 years ago, when we still struggled to save 700 megabytes of music on a CD. Today, we can sequence the entire human DNA – which amounts to several terabytes of data – for around 1,000 dollars, and analyze the interactions between the genes much more quickly than we could a few years ago. All of a sudden, a whole new range of business models becomes possible.

I will give you an example for this. Getting the entire office surroundings into the cloud does not require a digital strategy. Rather, it is just a matter of relocating tasks. If we could get patients to upload their fitness data to the secure cloud, however, their doctors could access this information and see whether their therapy is working.

The cloud is absolutely indispensable for such new business models. Other service providers could also benefit greatly from the cloud approach, such as the pharmaceutical companies whose medicine is used for therapy, or the insurance companies who could gain important insights from the information – all to the patient’s benefit.

The digital transformation of a company is only possible with the help of the IT industry. What do you expect from your IT partner?

Interaction between the IT industry and user industry is fundamental. This is the only way to find good proposals in technology. We work very closely with SAP and develop new ideas together. Someday, this co-innovation will become a part of production, just like the supply chain and procurement in the past.

The fact that SAP has set its sights on simplifying processes is a welcome sign for us that it is working towards reducing complexity. The new flexibility achieved through SAP HANA demonstrates that SAP has already taken huge steps towards transformation. Our own company has benefited greatly from this as well.

More information about digital transformation and its effects on companies and society is available on a free seminar on the openSAP platform.

Photo: Bayer AG

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