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HCL, Eli Lilly experiment 'co-innovation'

IT outsourcing vendor HCL Technologies partners U.S. drug maker to set up Singapore lab, which seeks to market innovations on mobile analytics and cloud computing.
Written by Kevin Kwang, Contributor

SINGAPORE--HCL Technologies has partnered U.S. pharmaceutical company Eli Lilly to open a Co-Innovation Lab here, representing the first such venture for both companies.

Virender Aggarwal, HCL's president and head of the company's business outside of India, said the direction of the Co-Innovation Lab will be driven by Eli Lilly in terms of the kinds of innovations to zoom in on. The Indian IT outsourcing company will focus on sourcing the "best minds" internally and from its partner ecosystem to work on these projects, he added.

Speaking at the official opening of the Lab on Thursday, Aggarwal said ownership of intellectual property (IP) rights or the products beyond the research and development (R&D) phase is among the "challenges" that commonly crop up when companies talk about collaboration. In this case, it has been decided that Eli Lilly will have first rights over the innovations produced out of the Lab, and if it passes on them, HCL will then own the IP rights or product, he revealed.

That said, Aggarwal admitted that the companies have not "worked out the revenue sharing or cost savings" tied to the colloration. He also said it is possible that Eli Lilly might choose to work with its existing vendors such as SAP or SAS Institute to deploy the technologies developed by the Co-Innovation Lab, and HCL might even "lose money" from the partnership.

"If we don't try something different, the business will get boring and we won't know how these partnerships will work out," he pointed out. "But we're hoping that since we are the ones that developed the product, that Eli Lilly or whoever we partner with will choose us to deploy the technology."

Krishnan Chatterjee, chief marketing officer and vice president at HCL, added that there was a "larger goal" in mind when the company agreed to the partnership. As the IT outsourcing mindset is evolving from a "procurement to business" one, there is strong impetus for it to change the way it does its business.

"If we are unable to change our current business model of procurement, we will not be differentiated and will lose out to our competitors eventually," he said at the launch.

Since it is also harder to bring innovation into the center of business without being entangled by organizational bureaucracy, it is easier and faster to start on the fringes through partnerships such as the Co-Innovation Lab, added Chatterjee.

The lab will also act as a proof-of-concept when engaging potential partners to set up similar collaborative projects, he noted.

Both companies are looking at a two-year timeframe to gauge if the Lab is a success, said Aggarwal. Success will be defined by the number of projects adopted and going mainstream and, according to him, one to two projects getting accepted by the industry would represent success.

He declined to reveal how much setting up the laboratory cost, only saying it was a "very small amount" and "not headline-making news".

For Eli Lilly, the partnership is one way of overcoming existing industry challenges. Mike Heim, CIO for Eli Lilly, said during the launch that the bar for drugs is getting raised higher, yet more regulatory guidelines are being introduced and these are barriers to bringing their products out to market faster.

Through the joint collaboration, Heim said the pharmaceutical company hopes to create the "right local and global ecosystem" to tap ideas for innovation.

Mobility, analytics top priorities
Quizzed on what kind of projects the Co-Innovation Lab will be working on, Aggarwal said mobile analytics, mobility, cloud-related technologies and finding ways to make mobile devices interact with medical equipment would be key focal areas for now.

Elaborating, he said mobile analytics is a big area of focus, particularly in finding ways to collate customer feedback on the drugs being developed or launched by Eli Lilly and conduct sentiment analysis for better insight.

There are currently 10 people working in the lab, but the number is supplemented by internal employees from HCL's analytics team and interns from local tertiary institutes such as National University of Singapore, Singapore Polytechnic and Singapore Management University, Aggarwal pointed out. It is also recruiting graduates from Bandung University in Indonesia and the university in Indianapolis, where Eli Lilly is based.

HCL had earlier in February set up its first global enterprise mobility lab here, too. Called the Merlin Lab, it taps the company's product engineering expertise to help businesses use mobility apps to differentiate themselves from their competitors.

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