The CIO View: Objectives for Startups in 2020 and Beyond

In the third session of our series, we had a conversation this week with Alan Boehme, VP Innovation Digital/Information Technology at Procter & Gamble to discuss how startups should be thinking about how they engage with large corporations in the time of COVID-19. Alan shared his perspective on how the pandemic is impacting the IT and security needs of large organizations like P&G what challenges lie ahead for startups looking to sell into big corporations.

We have a recorded session or you can read a summary of our conversation:

What are your priorities as an IT leader when something like this pandemic hits? Have your priorities shifted from what they were originally at the start of the year?

When this hit, for most corporations it was the start of their fiscal year. Travel, hospitality, etc. were decimated and will be for a very long time to come. Manufacturing is starting to come back a little bit…but as we will see dropping earnings, you’re going to see 20–30% reductions in discretionary budgets at those companies. So, one thing we’re seeing is that every salesperson has become an inside salesperson. A lot of the nice to have projects are getting back burnered, and things that have an immediate fiscal impact this year are being prioritized. For example, a cloud-based voice service is something that can have an immediate payback. Marketing dollars are also really changing because consumer habits are dramatically changing.

Do you think that more attention will be given to companies that solve supply chain problems? How do you test products and get consumer feedback in a time like this?

The days of the close personal interaction seem to be gone, so how do you get in-person feedback, body language, etc. when you’re doing virtual testing? So we need to rethink how this information is collected when you can’t reach out and touch people.

On the supply chain side, last mile delivery is forever changing how the supply chain is modeled. People have been accustomed to going to big stores to get things…there is less of a willingness to leave your “protected area” (i.e. home or neighborhood) to acquire their goods and services. So there might be more direct to consumer or microdistribution. Now also seeing restaurants selling bulk products and grocery items. Also big stores that were only selling to businesses that are now also selling to consumers in their homes.

How do you decide which domain you want to focus on from an R&D and innovation standpoint?

P&G has a big R&D team and so our processes haven’t changed much. We’re still actively researching and seeking new information, but the process in how we actually conduct our work is changing a little — like how we get people back to work safely, etc.

From a security standpoint, the idea of a fixed perimeter is gone. From a networking perspective, it’s showing the need for a more robust and segmented approach. The things that were kinda always being thought of are now being accelerated into adoption more rapidly.

Is there an openness to try new things in security and IT among big corps?

Network changes are going to be required by every organization. Network tech is going to really heat up coming out of the pandemic. These things that were more nascent are really going to accelerate. AI/ML is going to see a lot of adoption too. We need more predictability, seasonality isn’t going to remain constant anymore. It used to take an hour and a half to get from SF to San Jose. But you can do it in 30 min now. People are relocating and that is going to change the consumption of goods and services…so AI and ML are going to be hugely important.

Data analytics is an area that CIOs might see some additional benefit from going forward. What are your thoughts on this?

For years, many corporations have been flying blind on this. You’ve had tools that look at getting a better understanding of the cost associated with running IT but those were largely developed when we were talking about physical infrastructure. Obviously this is going to change with more cloud migration. There are not a lot of tools available out there right now that are easy to implement that really provide the transparency you need. So there is a huge opportunity for IT analytics to improve IT itself and therefore the business as well.

When you connect with startups in this domain, what makes a product solution more attractive to you?

Most companies have settled what platforms they’re going to use for the most part in a given domain. So who is optimizing these areas? That’s where there are still major opportunities, not in single, large platforms that are going to be used across an enterprise. Sometimes it’s best to go close 2–3 smaller or medium deals, instead of one giant one. Midmarket may have some exceptions, there might still be some opportunity there.

As you see opportunities, think about land and expand. Get that POC done and find out what makes it successful, and then focus on growing that. If 1–2 things take hold out of 6–7, those others will probably come along on their own. Get to market first with something that has legs and can have an immediate impact and then focus on growth. If you help them now, when times get better, they’ll remember that and come back to you in multiples.

Finally, what are the best ways for startups to show value to customers like a P&G, specifically how should the startup community best engage with them?

The one word I like to keep coming back to is empathy. We always have to have some empathy in what we do, but the people in corporations are people too. They are also going through lots of stress in their lives, so you need to treat them accordingly. Be sincere, know who you are talking to and understand the relationship.

When you get to the size of P&G, you can’t look at it as one company. There are multiple business units and decision makers, etc. Each of the 6 business divisions at P&G work in a pretty autonomous way when it comes to the services they use. Very few large corporations use the same services across the board, so tech companies that sell to them should not think they will be able to sell across the entire organization. You’re dealing with many large companies within a large company.

As difficult this is, there are a lot of good things happening from a behavioral standpoint. You don’t need to be talking to the CTO, CIO at a Fortune 1000 company, go talk to the decision makers and build a relationship with them.

I am very optimistic that startups are the ones that have the solutions we need to solve problems, the challenge will be navigating the relationships. Think about how to best/most respectfully get through to the decision makers.Networking and warm intros do matter. Remember there is a fine line between business and personal.

Very important to have strong customer advisory boards. If you can work closely with advisors that can help open doors and give advice, that is going to be the best way. Same with the relationships you have with your investors.

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