Genentech IT Exec: Remaking the Future

As we look at challenges that face the world, technology is going to play a crucial role, said Todd Pierce, speaking this morning at the Nassau Club for the Princeton Chamber. (Photo: Pierce, far left, with Marion Reinson and Peter Crowley of the chamber.) At least until Genentech’s buyout by Roche goes through, Pierce is vice president of corporate information technology at Genentech, known for being the founder of the modern biotechnology industry. He congratulated those present for their commitment to making their community a better place.

“Genentech was founded in 1976, by somebody who was unemployed,” said Pierce. He pointed out that, with the unemployment rate so high, the future could be created by someone who is now unemployed.

How it happened: Bob Swanson, who had been working for a venture capital firm but was unemployed, was working every day, networking looking for the next opportunity when he came across the idea that recombinant DNA might be a business. “A scientist, Herbert Boyer, promised to see him for 10 minutes and that led to a few beers and starting the company. Kleiner Perkins made a $100,000 investment for 25 percent of the company that we expect will sell, soon, for $100 billion.”

“Changing the practice of medicine began with Genentech’s substitute for human insulin, which had to come from the pancreas of cows and pigs. To help 700 diabetics required the slaughter of 26,000 animals. To supply US patients required 56 million animals. Two other organizations were competing. They worked day and night, but in three years we licensed it to Lilly. It took 14 years from idea to realization, a typical timeline for new drugs.”

“Now we are most known for being the Number 1 cancer fighting company. This week at Nature magazine, our scientists published a seminal theory for the cause of Alzheimer’s. We could change the course of Alzheimer’s disease.”

“I love doing IT at a technology company because every idea I have is challenged, yet it is integral to any business function. In fact 10 percent of Genentech employees are in IT,” said Pierce who then listed five factors that helped IT contribute to Genentech’s success.

1. Innovation and efficiency go hand in hand. “We realized we could not continue to be innovative if we were not incredibly efficient. For instance, we have 95 new molecules to bring to market over 6 years without growing the company. Yet IT can make things harder–for instance, with the switch to online ordering of supplies. Whatever we introduce has to make things easier.“

2. Combine urgency with originality. Pierce managed to gets his hands on enough early copies of the iPhone to do a pilot study to figure out if it was a toy or business tool for collaboration and sharing. “We had them within a week at Genentech.That is how urgency plays out. The iPhone made people respond very very quickly. It cut down the latency of decision making and information sharing. We can reach people anywhere any time. Now 80 percent of our workforce is mobile enabled.”

3. You can’t avoid failure if you want to be creative. .We have a passionate commitment to Single Decision Makers versus committee decisions, which promote a play it safe mentality. and Death by Power Point. Example, Avastin, a revolutionary cancer therapy. The marketing people, acting by committee, killed it because they didn’t want to have to sell a drug that costs more than $2,000 a year… Had we gone with that, cancer therapy would be different today. Now it is the only drug that keeps colon cancer patients alive. A scientist objected and the CEO reversed the decision.”

Example: Google’s “cloud computing,” a whole new way of buying services. I was the single decision maker.” The firm has moved 95 percent of its work to the Internet, device independent, and has 16,000 people around the world collaborating through Google.
Example: improvement of wireless connectivity. Genentech’s building is all wireless. “A revolution will happen in the next two years. After the switch to digital TV, that ‘beachfront’ (amazingly beautiful) bandwidth The speeds that you have at home will now be accessible through mobile devices, and having it in the cloud will allow you to share that information much easier. Now over 5 million businesses are on Google. We didn’t let the risk of failure keep us from doing it.”

4. New ideas often don’t look like good ideas. The iPhones, at the beginning, could be bought only by individuals. We were working with AT&T; to change the business model. Same thing with Google. We partnered with Google, saying that the tools for managing meetings were not good enough. We would meet them on Friday and Tuesday we would have a solution. We moved 2.5 million meeting appointments when we converted our calendar to Google. In the average month, the average manager at Genentech has 123 meetings per month.

That’s another major trend in cloud computing. Most major organizations take a long time to move from one to the next – we just retired Windows 2000. It is a cumbersome change. But when you move to the cloud, it just – changes! It requires a different mindset because you come in Monday morning and your calendar looks different and on Tuesday it was taken away. If Monday didn’t work out well, they roll it back. Then it appears again the following Tuesday. In just one month in Google we had over 139 improvements, all that we had asked for. If I were to call Oracle or Microsoft, it would take years, as opposed to weeks. If it can make work cheaper, easier, or faster, we want it.

The iPhone now has 25,000 applications, zero written by Apple. Apple built the platform that small business can use, reach 17 million people, they keep 30 percent, and they don’t charge to deliver the app. Soon there will be an application to monitor your blood sugar on the iPhone. The level of creativity is a major trend in IT.

In Google maps, some countries don’t have street directions, but end users can define maps. In Islamabad, Google allowed end users to define the streets. Trend: collective action creates whole new levels of value. In California, local PBS station used Google maps to locate where the fires were, and millions of people could contribute, and everyone, including the fire fighters, could use the info to plan escape routes.

5. The future is created by people that see opportunity and make it happen.
Islamabad. They saw the need and made it happen. California forest fires. They made it happen. At Genentech, we saw the opportunity to form a company and change the practice of medicine. The future of technology IS business. Without it, we won’t be able to address the challenges that we face. We have the urgency. We are willing to fail. We can support the creativity to make it happen. I firmly believe that nothing of significance can happen by people who want to take risk. We will live or die by innovating. We have no back up plan. In pharma, if you don’t innovate, you don’t survive. That excites me. We want to be forced to innovate. We see cancer as the competition. We want to always be first. Until we have cured cancer, we’re not done. Until we have cured Alzheimer’s we’re not done.”

In answer to a question about whether the Roche buyout will kill the goose that laid the golden egg, Pierce said, “We’re the geese. We are in charge of our eggs. Roche would need to give us food but just because we are not listed on the NYSE, our commitment to our mission goes way beyond who owns the stock

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