GSK's IT Procurement Strategy for Startup Partnerships

In their efforts to modernise the procurement function and drive increased value, pharmaceutical firms now must focus on identifying and adopting eProcurement and other innovative technologies. They also need to form and nurture strategic relationships with forward-looking partners and suppliers.

Startup companies have rightly earned a reputation for innovation and disruption across numerous industries, and in today’s market may be considered as a driving force for change and modernisation. But with their often-limited resources and lack of brand recognition, such startups may experience difficulty in forging relationships with major players.

The pharmaceutical giant GlaxoSmithKline (GSK) is well aware of this issue, and its Technology Procurement Team is actively removing barriers to innovation, allowing GSK to work with agile and disruptive startups more easily.

A Change of Tack

The healthcare market is increasingly competitive, and a willingness to acquire or develop innovative technologies is becoming a differentiator between successful organisations in the sector, and those they leave behind.

Jasdeep Sandhu, global senior manager for digital and tech innovation at GSK, puts it this way: “There’s a race to digitise big pharma and our competitor landscape is changing. If we don’t become more agile, the competition will take our market share. Start-ups have a disruptive mindset and are passionate. It’s an energy we need to tap into. They’re not afraid to share a crazy idea or say something controversial to provoke thought.”

Under the leadership of chief digital and technology officer Karenann Terrell, GSK’s technology procurement team decided on a change of tack, to transform how the company uses new technologies to improve performance. Their conclusion is that GSK must evolve its ways of working, to partner with start-ups in an agile “fail-fast” environment.

GSK Removes Barriers to Access

For many startups, getting a foot in the door at a corporate giant like GlaxoSmithKline requires a significant commitment in time and money - resources which may be in short supply.

Historically, the situation at GSK was typical of this. To remove barriers to access for prospective partners, change was needed. As Kristina Drysdale, head of tech and digital, professional and legal services procurement explains: “Our contract templates can be up to 120 pages and payment terms up to 60+5 days. Neither was appropriate for start-ups, so we set up a ‘SWAT team’ comprised of legal, compliance, technology, privacy and procurement, to consider how we overcome barriers to innovation. That team can make changes in a matter of days – not months.”

The ‘SWAT team’ downsized the contract template for startups to four pages, reduced the typical procurement life-cycle to a few weeks, and authorised the use of payment cards for pilots with startups.

This streamlining has empowered GSK teams to work with smaller, nimbler companies more easily, and the company now collaborates with more than 15 startups and has over 140 agile sprints contributing to its growth.

GSK Extends an Invitation to Collaborators and Partners

Extending its outreach to business and technological innovators, GlaxoSmithKline has constructed an online resource called The Mind at GSK. This portal provides sign-up facilities for innovators at all levels to submit their ideas and contact details - with an entire section devoted to startups.

The site also features case studies and industry news, highlighting the latest developments in technology, and the activities of GSK and its partners in innovation.

GlaxoSmithKline Looks Beyond the Present to Drive Innovation

Jasdeep Sandhu also heads procurement for a GSK team dubbed “The Beyond”. whose remit is to establish where GlaxoSmithKline wants to be by 2030 - and the steps it must take now, to get there.

To these ends, a quarter of the tech procurement team is currently dedicated to innovation and strategic partnering.

GSK Creates Strategic Partnerships

GSK’s technology procurement team has enacted a revolutionary approach to forming strategic partnerships, as it aims to drive value, without running traditional tenders. Based on a “partnership charter of trust, transparency and co-investment”. the team has formed strategic relationships with 10 technology partners.

GlaxoSmithKline and its strategic partners have been conducting disruptive experiments with technologies such as Robotic Process Automation (RPA), pilot schemes built on blockchain, and the integration of GSK’s first crowdsourcing platform with resources from its partner networks.

GSK Also Invests in the Future of its Own Workforce

To promote a culture of innovation within its own workforce, GlaxoSmithKline has established a Future Leaders graduate programme for technology. Over a two-year period, participants of the programme experience three varied and stretching rotations, working on live projects alongside industry experts and GSK’s strategic partners.

The scheme is open to university graduates with a technology background, and participants work in a variety of different cultures and markets, including startups.

Innovation, emerging technology, and their impact on the procurement profession will be key topics at ProcureCon Pharma 2020, taking place in March at the Hotel Palace, Berlin, Germany. Download the Agenda for more information and insights.

Return to Blog