TACKLING THE DIGITAL TALENT CHALLENGE IN LIFE SCIENCES: HOW REAL ESTATE AND WORKPLACE STRATEGIES CAN HELP

Digital technologies have the potential to transform businesses across all industry sectors,

but most life sciences companies have not yet made the bolder moves other sectors have in

taking advantage of their capabilities.

This is now starting to change with

biopharma companies such as Novartis,

Pfizer, GSK and Merck & Co all hiring

high-profile Chief Digital Offers (CDOs)

from more digitally mature industries to

spearhead their digital ambitions. This

is encouraging given the multitude of

benefits digital technologies can bring

to this sector: faster drug discovery and

development, improved operational

efficiency and productivity, more

personalised patient experiences and

better engagement with key healthcare

stakeholders.

Real estate has a central, and often

overlooked, role to play in enabling

and sustaining these transformations.

Some of the real estate occupied by

life sciences companies isn’t obviously

conducive to attracting digital talent.

This means that portfolio and workplace

strategies need to actively drive cultural

change, with digital talent acquisition

and retention seen as an integral part of

portfolio and location decisions.

CBRE | Life Sciences

The Digital Talent Challenge

Digital transformations are not easy,

even for tech savvy companies.

According to McKinsey1, the

pharmaceutical industry success rateof

these programmes is only 4-11%, with

larger companies more likely to fail.

There are many different reasons for

this, but accessing the right digital skill

set and driving the cultural changes

required to transition to new ways

of working are two of the biggest

challenges.

The opportunity exists to leverage the

vast amounts of data available across

the healthcare spectrum to drive future

value for life sciences companies.

However, extracting value from these

data assets needs the right combination

of people, processes and technology,

all operating within an agile and

collaborative culture. Ultimately, it is

teams, not technology who drive digital

success.

Attracting and retaining the talent

mix required to make that shift is a

key concern for industry executives.

According to PwC’s CEO survey2,

60% of life sciences CEOs were very

concerned about a digital talent

shortage and 57% find it very hard

to attract the right calibre of people.

McKinsey have reported that demand

could be four times supply for agile

skills and 50-60% greater than

projected supply for big data. For those

fortunate enough to secure the top

hires, they can be rewarded with double

digit investment savings by accelerating

the digital transformation process by up

to 20-30%.3

Biopharma and life sciences companies

are not just searching the same talent

pool as other industry sectors for

general digital talent, but are now also

facing competition from technology

companies for specialist sector talent,

such as computational biologists and

bioinformaticians.

Genomics-based research has created

increased demand for these skill sets

across life sciences, but technology

companies such as Google (Verily life

sciences), IBM Watson, even Netflix

and Amazon are seeking them out

too. Figure 1 shows why - the core

skills of a computational biologist/

bioinformatician are actually very

similar to broader data scientists,

with programming languages at the

forefront, but their scientific knowledge

is also extremely desirable for the tech

companies focused on healthcare.

The career choices available to them

now therefore extend way beyond their

traditional life sciences paths.

1 McKinsey ‘Unlocking success in digital transformation’, Oct 20182 PwC 21st CEO Survey, Pharmaceutical and Life Sciences Findings, 2018 3 McKinsey and Co ‘The new talent you need to succeed in digital’, Sep 2016

Figure 1: Computational Biologists - most frequently cited skills

R

Bioi

nfor

mat

ics

Pyth

on

Dat

a An

alys

is

Jave

Com

putio

nal B

iolo

gy

Mol

ecul

ar B

iolo

gy

Mac

hine

Lea

rnin

g

Gen

omic

s

Rese

arch

C+

+

Stat

istic

s

DN

A Se

quen

cing

Mat

lab

Algo

rithm

s

Dat

a M

inin

g

Java

scrip

t

My

SQL

SQL

Perl C

Linu

x

Biot

echn

olog

y

Uni

x

Gen

etic

s

“60% of life sciences CEOs were very concerned about a digital talent shortage”

CBRE | Life Sciences

Source: 40 computational biologist skills profiles

Acquiring and retaining digital talent – the importance of location and workplace experience

The question, therefore, is how can

life sciences companies use their real

estate as a strategic tool to help them

succeed in securing digital talent in an

increasingly competitive environment?

Many established biopharma

companies start disadvantaged because

they are still largely situated in out

of town campuses, while the highest

concentrations of digital talent is

generally found in cities.4

Millennials make up the majority of the

available digital talent pool and around

50% of the global workforce.

Although pay is still a major incentive to

attract them, 79% consider workplace

quality as a key consideration in

selecting a new employer and 69% say

they’d trade other benefits for the right

workplace experience.5

It’s therefore no surprise that life

sciences companies are now starting

to approach programmes designed to

create a ‘workplace of the future’ that

provides a consistent brand experience

across their organisations, regardless of

employee function or location.

But is this happening quickly enough?

PwC’s study suggests biopharma and

life sciences executives are actually

doing less than the global average to

address the digital talent challenge.

From a real estate perspective, less than

half reported that they are modernising

their workplace environment (39%) and

only 6% are relocating their operations

to be closer to available talent pools.

Innovation clusters providing access

to the right technology platforms,

collaboration zones and amenities are

likely to appeal to the digital natives,

but the concept of acquiring permanent

fixed physical locations in key cities as

a means of accessing them may not

necessarily be the whole answer.

CBRE’s Portfolio 2040 report predicted

a future digitised workforce that will

comprise of 50% contingent workers,

so both virtual and physical spaces will

need to be leveraged to respond to

these changing dynamics.

Figure 2: Data Scientist - most frequently cited skillsPy

thon

Mac

hine

Lea

rnin

g

SQL

Dat

a An

alys

is R

Dat

a Sc

ienc

e

Stat

istic

s

Mat

lab

Proj

ect M

anag

emen

t

Rese

arch

Dat

a Vi

sual

izat

ion

Apac

he S

park

Scik

it-Le

arn

Tabl

eau

Had

oop

Anal

ysis

Man

agem

ent

Dat

a M

inin

g

SPSS

MyS

QL

Num

Py

Java

Scrip

t

Java

Dee

p Le

arni

ng

Big

Dat

a An

alyt

ics

4 CBRE ‘Opportunities in European Tech Clusters’ ,20185 CBRE Live, Work, Play study

“79% consider workplace quality as a key consideration in selecting a new employer”

CBRE | Life Sciences

Source: 40 data scientists skills profiles

1 McKinsey ‘Unlocking success in digital transformation’, Oct 20182 PwC 21st CEO Survey, Pharmaceutical and Life Sciences Findings, 2018 3 McKinsey and Co ‘The new talent you need to succeed in digital’, Sep 2016

What real estate and workplace strategies can be adopted to attract and retain digital talent?

Some life sciences companies,

particularly large biopharma, are now

starting to deploy strategies to address

the challenge. Multiple initiatives

together are likely to be most fruitful

given the importance of deploying

digital business models for future growth

and the scale of the talent shortage:

1. Understand your emerging and future talent requirements and where these skills are located

Developing capabilities for leaders

and existing employees is essential

for the longer-term success of digital

transformation. For instance, Novartis

in their ambition to become a medical

and data science company have already

started investing to ensure leaders

and employees are ‘curious’ and

‘comfortable with digital and data’. This

includes digital immersion programmes

to embed the new ways of working at

the most senior level.6

However, new digital practitioners will

also be required as efforts ramp up, so

understanding the profiles that bridge

the gap between existing capabilities

and a future operating model is key.

Some will be sector and geography

specific, some more generalist. When

that is clear, utilising labour and

location analytics to identify the talent

hot spots will give an evidence base

to inform recruitment strategy and

location-based decision making. HR

and Real Estate teams will need to

work closely to build their digital talent

strategy into broader future plans.

However, identifying the talent only

informs you of where they are -

attracting and retaining them is far

more challenging. As a result, an

increasing number of organisations

are weaving workplace quality and the

opportunity for flexible working into their

employee value propositions. According

to LinkedIn7, there has been a 78%

increase in the number of job adverts

providing flexible working options since

2016. The healthcare sector is at the

bottom of the pile with only 43% of

professionals in healthcare companies

reporting that they allow workers

to work remotely versus 72% in the

software and technology sector.

There is a balance to be struck here.

Research by Gartner8 indicates there

is a negative impact on employee

engagement for those employees who

work from home regularly for more

than two days a week and an equally

negative impact for those employees

who have no opportunity to work from

home. Providing choice to employees

on working preferences therefore is

key and with the breadth of options

available around flex offices and

co-working expanding, it is possible to

try different approaches.

Back in the office, it is generally

acknowledged that our workplace

can have a meaningful influence on

our performance at work. However,

measuring this and convincing senior

stakeholders has been based more

on faith than science and investments

in workplace transformation are still

more often weighted more towards

real estate reduction than workplace

quality. This is starting to change. Life

sciences companies, among others,

are becoming increasingly conscious of

employee health (physical and mental)

and with advancements in technology,

more research is emerging (CBRE

2016 ‘Healthy Office’ and CBRE 2018

‘CBRE Lab’) that seeks to prove the link

between the quality of work and that of

the working environment.

6 PharmaExec ‘Future Pharma: Data Science as a Strategic Partner’, Jan 20197 LinkedIn ‘Global Talent Trends’ ,20198 Garner ‘Measuring employee engagement: past, present, future’ ,2017

CBRE | Life Sciences

2. Create a workplace that aligns with an agile culture

Digital transformations will struggle

to reach their full potential without an

agile culture being adopted across

the organisation. This is forcing

organisations to think differently,

building agile into the way they work

to emulate the speed and dynamism of

smaller, more nimble players.

Roche is reportedly pursuing an agile

transformation, starting with leaders and

encouraging them to ‘confront patterns

of thought that while successful in the

past, may now limit their effectiveness’

and introducing them to the practices of

agile organizations and how to engage

others in the journey, forming cross

functional teams to redesign structures,

process and business models.8

Agility can also be hindered by

departmental silos, PA’s Agile

Organisation report outlines the

emergence of new organisational

structures with supporting environments.

Forward thinking organisations are

designing more fluid workplaces,

balancing space for open collaboration

and private focus, allowing people to

personalise their workday. Inclusion of

project space makes it easier to connect

multi-disciplinary teams quickly and

efficiently for a short, intensive meeting

or for the duration of a sprint.

The provision of new services and tools

also helps to remove the roadblocks

to connection and help to make work

easier for everyone.9

The challenge for established

organisations is overturning years of

ingrained traditional working patterns.

Losing offices, long held as the pinnacle

of corporate achievement, and working

in open spaces is only part of the

problem. The real challenge lies in

incentivising people to change how they

work and how they engage broadly

across their organisation.

3. Acquire capabilities and talent through M&A and partnerships

The pharma industry has form in

acquiring small innovative biotech

companies. However, digital M&A

activity has been slower than anticipated

to take off, with the industry mostly

favouring partnerships and JVs over

equity investments.

GSK however made a bold move

through their $300m equity investment

in genomics company 23andMe in

2018. The partnership is at the heart of

GSK’s future ‘driven by genetics’ R&D

strategy, combining the genetics and

data science expertise of 23andMe with

the scientific and commercialisation

capabilities of GSK.

Pfizer, Novartis, Otsuka and Sanofi have

all formed strategic alliances with Verily

life sciences (Google’s healthcare spin

off) to transform and accelerate the

outdated and inefficient clinical trials

process. Verily have a breadth and

depth of digital talent who have focused

on building their data technology

platform, tools and advanced analytics.

Google and Sanofi have also just

announced their ‘Virtual Innovation

Lab’ collaboration which is designed

to combine their respective strengths to

accelerate the healthcare innovation

cycle.

Perhaps it is no surprise that these

partnerships are favoured over M&A,

accessing the data, tools and talent

to support digital ambitions without

the challenges of integrating culturally

different companies. There are more

examples of culture clashes between

larger, more established organisations

and smaller, more nimble companies

than successful integration stories, often

resulting in the loss of the innovation

and talent that the acquisitions were

intended to capture.

8 McKinsey ‘How a healthcare company is pursuing agile transformation’, Jan 20199 PA consulting “Creating the agile organisation”, 2018

CBRE | Life Sciences

4. Create your own digital innovation hubs

Some pharma companies are directly

addressing the deterrent role that some

of their real estate plays in attracting

talent. This is being done by selectively

introducing new property formats

designed to nurture start-ups and

fast-growing innovators. For instance

J&J (JLabs), Novartis (Biomes) and Leo

Pharma Innovation Labs among others

have created separate incubator/

start-ups to drive scientific and digital

innovation. These environments are

designed to feel more agile and

entrepreneurial and are purposely

situated in geographical locations with

rich pipelines of both scientific and

digital talent.

5. Collaborate with broader groups and raise brand presence in emerging innovation clusters/knowledge districts

Partnerships with non-traditional

players can fill out a company’s skill

set – academia and tech start-ups and

clusters are emerging that span both

science and technology and reflect the

increasing convergence of life sciences,

healthcare and technology. Having

some form of presence in desired

geographical hubs with a start-up

feel can drive new collaborations and

positive brand associations, providing

access to new talent pools either directly

or indirectly.

Conclusion – The Way ForwardThere is no universal solution

to address the digital talent

shortage and it will continue

to be a challenge across all

industry sectors. Life sciences

companies can be particularly

challenged because of their

legacy core locations that often

misalign with the urban living

and working style favoured by

millennials and Generation X as

well as perceptions that the highly

regulated nature of the industry

restricts the speed of digital

innovation.

Therefore, business leadership,

HR and real estate teams need

to work together, activating

external partnerships and

adopting an agile approach to

develop integrated solutions.

Understanding the needs,

workstyles and preferred

environments of digital talent is

only the start – but it’s absolutely

central to getting this right.

cbre.co.uk

Joanne HendersonExecutive DirectorHead of Life Sciences, EMEA t: +44 (0)7557 426 960e: joanne.henderson@cbre.com

Richard HolbertonSenior DirectorEMEA Research t: +44 (0)20 7182 3348 e: richard.holberton@cbre.com

Lewis Beck Head of Workplace EMEA A&T Workplace Strategies t: +44 (0)7966 563 174 e: lewis.beck@cbre.com

For any further information, please contact: