group of financial professionals analyzing markets picture id897667680 3

CIOs across multiple sectors have taken to the art of mining smaller startups for new talent and ideas.

The benefits of collaborating with startups can range from leveraging expertise in emerging technologies to giving your organisation an injection of energy and new ideas.

By working with startups, be it through soft support to more concrete measures like procuring their services, providing investment or even acquisition, organisations can often get faster access to innovation than going home-grown.

That being said, startups often work in more modern ways, meaning their culture might not mesh with more traditional workplaces. It is also critical to consider that some startups are less likely to survive than others.

When identifying the right startups to work with CIOs should identify startups that are looking to disrupt their industry, assess whether their technology is truly unique and the strength of the management team.

Read next: How CIOs are working with startups

"First, the startup needs to offer a differentiating capability for my business. Startups that have potential to significantly enhance our existing business lines, or create the foundation for an adjacent business line, will get my attention," says Angela Yochem, former CIO at logistics firm BDP International and now EVP and chief digital and technology officer at US healthcare firm Novant Health.

"Second, I look at the startup's willingness to engage creatively with our company, and how flexible the startup can be. Third, the people behind the pitch will be partnering with our business, so they must be transparent, perceptive, skilled in complementary ways, and have the ability to deliver game-changing offerings to our customers.” 

Embrace a new business strategy

Pharmaceutical giant AstraZenica recently signed a major deal with UK startup BenevolentAI to leverage its AI and machine learning expertise to more quickly develop new treatments for chronic kidney disease and idiopathic pulmonary fibrosis.

“Finally, we are really starting to tap into the startup community. We are working with many companies that didn’t exist five years ago, who typically have developed their products with only cloud, mobile and usability in mind,” David Smoley, CIO at AstraZeneca says. 

The CIO tells us that the company has noticed huge value since working with technology startups.

“With the advances in cloud computing, this has enabled our business to tap into new approaches, such as deep learning for drug repositioning, machine learning for patient stratification, image recognition for digital pathology, advanced data compression for genomics, lightning-quick databases for mobile apps, smart wrangling tools for clinical data, new social channels for teams, influencer identification across social media and new IoT sensors alerting us to anomalies in our lab equipment before they break.”

Seek the right talent

"We're doing a big insourcing drive to build digital capability in London and Manchester through partnerships with local startups to develop young talent with leading digital skills," Ajit Dhaliwal, head of IT delivery at Vodafone says.

"We're working with startups who basically are incubators for digital talent. They get digital youth in either from high school or apprentices, and they'll train them up in the basics, and then we look to offer them employment, and then training in-house with Vodafone."

This enables the UK telco business to gain access to multiple streams of undiscovered talent to boost the business as it modernises.

Gain the right knowledge

“While real estate isn’t the first to be impacted, a faster response is required. Bringing innovation and opportunities, startups can support us in achieving this ambition, but equally have the potential to become disintermediation threats. Nimble niche players and innovative startups are as much a threat to our business as traditional competitors,” Chris Zissis, EMEA CIO at real estate company JLL tells us.

For example, in December 2016 JLL signed a global cooperation agreement with Leverton, a machine and deep learning technology startup, to investigate automating and digitalising key administrative processes in lease management.

“The technology Leverton offers enables the identification, extraction and management of key terms and data from corporate documents, such as leases and contracts. We are integrating these systems into our own technology platforms to transform the way lease documents are reviewed, analysed and managed for our clients,” he adds.