September is always bittersweet. While summer is in the rearview mirror, there’s so much to look forward to in the months ahead. And there are few industries innovating and investing as much in the road ahead as FinTech. Our September 15th event in Jersey City will address the needs of growing financial sectors as they seek to develop and implement an effective FinTech framework. We’re thrilled to have Kush Saxena, Group Executive, Strategy and Corporate Development from MasterCard, as the keynote speaker. And an agenda full of networking and perspectives from experts in FinTech.
A culture of innovation is what differentiates top companies from the rest of the pack; yet, leading innovation throughout a company in today’s environment is incredibly challenging. This year, the Tech Council’s Leadership Summit, on October 5th in Bridgewater, will focus on this important topic. Join us for a keynote from the CEO of Celgene, Mark Alles, as well as a panel of CEOs and roundtables which will offer unique insights on creating the ideal culture of innovation for any company.
Also, please save the date for our 20th Annual Awards Celebration on November 17. It’s always a great event that celebrates not only the change makers, but all of the companies and leaders working towards the future and innovating. — James C. Barrood, President and CEO, NJ Tech Council
In this issue
- 4 Keys to Entrepreneurial Success: Building a Corporate Culture
- Corner Office: Kush Saxena, Group Executive, Strategy and Corporate Development, MasterCard
- Plugged In: Achieving Data Center Transformation Selecting Colocation Services
- Is This the Year Virtual Reality Goes Mainstream?
- How to Lead with Character
- Feature: Sounding the Alarm
- Education: Mastering Big Data
- Education: An NJIT Student Takes on Tech’s Gender Gap
4 Keys to Entrepreneurial Success: Building a Corporate Culture
By Steve Cohen
Corporate culture should reinforce and support an organization’s product or service brand.
Over 25 years representing emerging companies, I have observed that the single most important factor in determining success is people. Most VCs have shared the same experience and they would rather back a great management team with a good idea than a mediocre team with a great idea. Most emerging businesses fail not because of insufficient business plans, but insufficient implementation.
Even the smartest, most talented, and hardest working entrepreneur will peak early in their company’s growth cycle unless he or she can put together, motivate and retain a team of talented, dedicated employees. Each organization develops its own identity and personality, which impacts not just employees, but customers, suppliers and other business stakeholders.
Corporate culture can be an integral part of an organization’s business strategy. For example, Whole Foods, the healthier grocery store, incorporates social responsibility and supporting organic farming as core values which motivate loyalty from its employees, customers and suppliers. Zappos has all job applicants participate in a “cultural fit” interview and its Zappos Ten Core Values are regularly reinforced and intended to differentiate Zappos from other online retailers. Southwest Airlines differentiates itself from other airlines with a culture that promotes pleasant employees who are given a bit of freedom to be funny while making boarding announcements and interacting with customers. Google, Twitter and Facebook all succeeded with cultures that motivate their employees to break new ground and create new markets and include perks employees care about such as meals, games in break rooms, gyms and onsite laundry. Google headquarters even has an area where employees can bring their dogs to play while they work. These perks motivate employees to stay at headquarters, refresh their creativity and work hard.
Corporate culture starts at the top with themes such as encouraging innovation, pursuing excellence and supporting achievement. For the CEO’s culture themes to transform into organizational culture, broad buy-in is required. The strongest corporate cultures with greatest buy-in develop with input and feedback from the employees. Components of corporate culture may include a mission statement to articulate corporate vision, communication style, human resources policies and other company practices, and physical layout of the workspace. Culture provides the customs and habits for how employees interact with each other and how employees interact with the outside world – customers, partners and suppliers. Corporate culture should reinforce and support an organization’s product or service brand.
Notwithstanding the impact corporate culture can have on success, few boards of directors focus on it. The board will generally provide the company’s CEO with goals around spending control, revenue generation and/or profit growth, but culture is rarely a metric monitored at the board level. Similarly, there are few “how to” books on creating the optimal corporate culture. It is left to the CEO and executive team and learned through trial and error and experience.
Join us at the NJTC Leadership Conference as C-level executives discuss best practices in developing a successful corporate culture, including guidance and war stories from CEOs of some of the region’s most successful companies.
Steve Cohen is global manager of the Morgan Lewis emerging business practice and recipient of NJTC’s Legend of Technology Award. This is the first in a series of TechNews Articles on the Keys to Entrepreneurial Success.
Corner Office: Kush Saxena, Group Executive, Strategy and Corporate Development, MasterCard
By Jennifer Simoni
1. Is your team local or global?
Our team leads global strategy, M&A, corporate development and competitive intelligence for Mastercard – which as you can imagine, is a truly global company operating in over 210 countries, driving a number of businesses with upwards of 11,000 people in the company. Given such a global business, our team must meet the demands across multiple businesses and markets.
2. How do you stay connected and communicate efficiently?
There are a few ways we do this. Some of our engagement is programmatic – we shape and set the agenda for both our strategic business reviews and corporate development activity on an ongoing basis across the calendar year. This ensures there is a systematic cadence to how we engage all businesses and markets. Additionally, we set ourselves up to be highly nimble and responsive to business needs that may come up outside of our programmatic agenda: For example, many of our M&A engagements are driven by when a particular deal opportunity arises. Of course, to accomplish all this we end up traveling quite a lot. Finally, the company has many initiatives and global forums in place where all this comes together: For instance, we have leadership meetings where as a leadership team we focus on strategy, take stock of developments in our industry and plan forward.
3. You’re relying on input from a lot of different people—how do you coalesce everyone around a unified forward-looking idea and strategy for the company?
As I mentioned we operate in a number of different businesses across a number of different markets. Additionally, as a payments network we don’t target a single customer or stakeholder but truly enable all stakeholders – consumers, merchants, banks etc., each with their own needs and value propositions. Subsequently, we end up not only looking at strategies for multiple businesses but also multiple lenses to every strategy.
In that sense, we focus on directing our people’s energies across a shared vision, a common thread that cuts across all our businesses and markets but execution of which may require tailoring at a local market or product level. That alignment across a single vision is really what is critical for us.
4. What is the biggest challenge you face in your position? How do you approach it?
Being an industry leader and one of the longest standing players in payments, a highly competitive and technology driven space – we spend a lot of time anticipating and preparing for industry shaping trends and competitive developments. To do that, we constantly listen to the market for developments that may point to emerging trends or competitive activity and then try to understand what all this means for us over both the short and the long term.
5. One of your responsibilities is pursuing strategic partnerships and investments. What are some key things you look for in a strong partnership?
There are several things we look at, but perhaps most critical is strategic fit for any partnership or investment. And while it’s important these efforts drive value in the near term, it’s critical that they drive long-term value. Another thing we look for is the quality of talent in the companies we work with or invest in – we are always looking for smart people, good people, people that are going to be positive agents of change within their companies but also Mastercard as a whole.
6. We’ve been hearing a lot about blockchain as it relates to financial payments and systems — any thoughts on blockchain?
We think Blockchain has the potential to be a very important technology not only in payments but in many areas beyond payments as well. And while it/s already showing promise in areas such as cross-border remittances, identity management, supply chain and smart contracts, I believe the technology is still in the early stages of discovering its full potential. In that sense, it’s great to see the extent of attention and focus from various industry players and I believe that will lead to further evolution of the technology. We are also looking closely at the potential of Blockchain to create better value propositions for our customers and stakeholders – we have dedicated a center of excellence focusing on it, are investors in some key Blockchain companies, have filed over 30 patents and always looking to talk to companies that are doing new and promising things with the technology.
7. What about machine learning and AI?
Different from blockchain, I see machine learning and AI as technologies that have been around for a while, evolving over a long period of time and attaining industrial grade maturity now. In our business the applications of machine learning are endless whether in fraud, identity management or data/ analytics insights to drive revenue growth for our bank and merchant partners. And again, we welcome the focus the industry has and we’re going to keep watching the capabilities.
Plugged In: Achieving Data Center Transformation Selecting Colocation Services
By David Mettler
Selecting colocation services is more than just scaling existing capacity, it’s an opportunity to improve efficiency and increase flexibility to adapt easily to business change.
Colocation is a top consideration for companies looking to address their data center capacity constraints. Colocation refers to when an organization houses its IT equipment (servers, storage, network gear) in a multi-tenant data center. This strategy typically helps businesses gain access to economies of scale, advanced infrastructure, greater bandwidth and operational expertise.
For New Jersey tech firms, your quest in selecting colocation services needs to be about more than just scaling existing capacity. Your company needs to see this journey as an opportunity to transform the data center to improve efficiency and increase flexibility to adapt easily to business change.
Colocation Fundamentals Done Right
The first step in transformation is to ensure all the data center service basics are well covered in a colocation offering. These include having reliable and resilient power and cooling capabilities in place to help ensure always-on uptime and optimal performance, having multiple layers of physical and logical security, and carrier neutral network connectivity.
Physical security needs to include video cameras to monitor all general areas within the facility; man-traps, equipped with biometric authentication, to prevent impersonation and unauthorized tail-gating; and fire-rated walls and doors to protect against a disaster.
Network options should allow you to extend private networks without using the public Internet. This approach needs to not only include communications between multiple systems within a data center footprint but also cover communications between colocation infrastructure and any end point, including other data centers and public cloud services. Doing so will enable a borderless data center, connecting any location with a network presence.
Modular Colocation – Go Beyond the Fundamentals
Most colocation providers operate construction-based data centers, in which they leverage traditional design, build, and operations practices from the commercial real estate industry. To achieve data center transformation, your company needs to leverage a model based on modular data center technology, which allows for colocation solutions that traditional data centers cannot provide. These include:
Scalable Growth – Fast. A modular data center colocation service provider can help you future proof your data center by delivering standardized deployment options that give you the flexibility to meet the demands of your compute today and beyond. The modular form factor allows for thin provisioning of the data center, meaning that you can deploy the actual capacity you require and then expand when needed. If your modular data center provider operates at a large scale, and uses manufactured, purpose-built modular technology, they’ll be well positioned to deliver new capacity to you in as few as 30-90 days.
Operational Efficiency. Modular data centers enable enterprises to achieve efficient utilization of their data center infrastructure. Too often an organization that has felt the pain of running out of capacity in their traditional data center will over buy new capacity when they move to a larger data center. This inefficient use of the company’s capital has two direct costs: 1) paying for services they do not actually need, and 2) underutilization of their data center space which increases the cost to power and cool the data center they are using. By offering capacity in small increments a service provider can offer significant savings to their customers.
Improved Security. Modular technology also improves security by providing a data center within a data center – with each module being its own private steel vault. And modules that have a compartmentalized architecture go one step further by enabling the segmentation of colocation users, eliminating any risk of noisy neighbor syndrome and keeping potential hazards from spreading.
Flexibility – An Adaptable Data Center
Next on the road to data center transformation is being able to leverage cloud services and traditional colocation services under one roof. The key is to have a data center platform that allows for flexibility among colocation, public cloud and private cloud so that you have the ability to fully understand your costs, your data security risks and obligations, and determine the best solution for your business.
With this strategy, your organization can know where your data is physically, and who is managing the infrastructure that stores your data and runs your applications. Additionally, for large amounts of data, network performance is not an issue if your entire infrastructure is physically located in the same building. Many organizations enjoy the peace of mind that accompanies knowing where their data physically resides.
Software Optimized Data Center
We live in a software-defined era. Much of the value of the data center going forward will be driven by software innovation. Data center infrastructure management (DCIM) software monitors and manages all enterprise data center assets inside of your colocation space, but DCIM does not provide insight into the critical systems that enable your data center space to operate. You need to have full transparency of your colocation service which means real time information on your power utilization, your PUE, temperature, humidity, and access controls. This requires a data center operating system and, if you can integrate this information with your DCIM, then you can receive the business intelligence, real-time visibility and control needed to transform your company’s infrastructure management.
Transforming Your Data Center
As your business looks to address the inevitable need to scale your data center environment and considers colocation options, you should take a strategic approach and look towards transformation. Create a next generation data center with a modular colocation service that is truly scalable, efficient, secure, and software managed. By doing so, you will position your company to intelligently manage the data center to drive more efficient operations and improved performance.
David Mettler is IO’s Vice President of Sales and the Market Director for the US, based in Edison, NJ. IO is a data center services provider. www.io.com
Is This the Year Virtual Reality Goes Mainstream?
By John Pennett
The first part of 2016 has seen historic investment in the VR sector, with funding approaching $600 million – estimates are close to $1 billion by end of year.
From the View-Master personal slide projector dating back to the 1930s to the 2009 movie Avatar, virtual reality (VR) is a concept with which
most of us are at least vaguely aware. This may be remembered as the year, however, when the average consumer was able to purchase and use VR.
The headset devices, which need to be tethered to a computer or smartphone, use infrared tracking sensors and handheld controllers, along with lenses that allow for a wide field of view, to create a 3D experience. This experience can include sight, touch, hearing and even smell.
The devices were originally designed for virtual experiences and gaming. Participants can travel in deep space, kayak through the Grand
Canyon, walk with dinosaurs and so on. However, a number of other applications are being considered, such as helping architects design buildings and the military train soldiers.
There are also a variety of ways VR can be of use to the health care sector. Examples include surgery (training, robotic and remote); physical
therapy and pain management; and using VR as a therapeutic tool to help people overcome severe phobias. The potential to use virtual reality as a medium has not been lost on marketers. Picture virtual advertisements for car companies, hotels, sporting goods companies and others. There
also promises to be considerable consumer data that can be collected from users of virtual reality.
Two of the main manufacturers of consumer VR products are Facebook, which markets the Oculus, and HTC, maker of the Vive. Each weighs
just over 1 pound and uses a proprietary tracking system – Oculus (Constellation) and Vive (Lighthouse) – that offers a view field of 110 degrees
and features an OLED display with a resolution of 2160×1200. The Oculus retails for approximately $600, while the Vive is about $800. Other
companies targeting the VR market include Sony, Google, Apple, Samsung and Microsoft.
Industry estimates place the current number of active VR users at 43 million people, mostly in the gaming area. This number is expected to quadruple in the next 2 years. This translates to roughly $1 billion in virtual reality sales for 2016.
The first part of 2016 has seen historic investment in the VR sector, with funding approaching $600 million. Investment has taken the shape of smaller crowdfunding campaigns for VR accessories up through $100 million hardware funding from companies such as Disney.
A dedicated venture capital fund for virtual reality, The VR Fund, was created to provide capital, insights and strategic relationships to VR startups. Another resource for early-stage VR companies is growing trade events such as AWE USA, SALENTO AVR, and Siggraph.
While VR hardware development has moved at a quick pace, there has been less movement on software and content. This led HTC to create the Vive X Fund, a $100 million fund to help new companies create software for the Vive VR headset. Facebook has created a similar fund, albeit at a much smaller dollar amount, to create a software/content pipeline for the Oculus.
Manufacturers have faced a few market challenges. One is optimizing distribution channels. Products are available through a limited number of outlets, such as BestBuy and Amazon, but shipping dates have been repeatedly pushed back. Another is users need robust computer systems, typical of the ones gamers use, to handle the technology appetite of virtual reality products.
An interesting VR malady is “simulator sickness,” the reported feelings of nausea and dizziness people get when using virtual reality systems. This is commonplace enough that Oculus rates its various games and experiences as comfortable, moderate, and intense. It is hoped, however, that this will dissipate over time with repeated use.
Another VR concern is the continued march toward social desensitization by adding yet another device that captivates people’s attention. Some experts are even going as far as to predict the possibility of VR addiction. Regardless of the challenges, virtual reality appears here to stay, with The Wall Street Journal calling it a “glimpse of the future of computing.”
John Pennett is the Partner-in-Charge of EisnerAmper’s Life Sciences and Technology groups. He has more than 30 years of public accounting experience, with an emphasis on life science and technology companies. John is a frequent writer and speaker on issues impacting businesses in these sectors. Contact him at: firstname.lastname@example.org
How To Lead With Character
By Chris Sugden
Trust, Authenticity, Innovation, Learning to Follow, and Empathy are not words or actions many expected to hear at the United States Military Academy at West Point. Yet these are several of the key principles used to teach and develop our future Army leaders.
For the last five years, Edison Partners has hosted an annual CEO Summit for the CEOs in our portfolio as part of our Executive Education program. This year, we held the event at the United States Military Academy at West Point, NY. I know I speak for the nearly sixty CEOs and members of the Edison Director Network who attended when I say that the Thayer Leader Development Group and West Point provided actionable learning, an inspirational setting and a greater appreciation for the men and women who serve our great nation.
The theme for this year’s CEO Summit, “Lead-ing with Character in a VUCA Environment,” was a topic everyone in attendance connected with. VUCA is an Army acronym and stands for Volatility, Uncertainty, Complexity and Ambi-guity – which certainly describes an entrepre-neur’s as well as a high growth company’s envi-ronment. We are challenged each day as leaders in high growth companies to motivate, excite and drive our organizations to greater success.
While the U.S. Military Academy is known for developing our best and brightest into military leaders, it quickly became clear that West Point’s approach to leadership has strong applications for developing leaders in business.
The top 5 principles that I learned at West Point and am applying both at our firm and with my portfolio companies are:
1. Work to Prove People Right, NOT Wrong
“Work hard to prove people right NOT to prove people wrong.” This quote by Colonel Pi-lar Ryan (USA, Retired, USMA, 1986) continues to stick with me.
For many of us, negative energy drives us. We want to prove the coach who cut us from the team, or the boss who didn’t give us that promo-tion wrong. But, Col. Ryan’s advice of ‘Proving People Right’ turns the paradigm 180 degrees with a focus on positive energy.Consider the manager who gave you the pro-motion when you weren’t sure you were ready for it. What about the coach who gave you a spot on the team because he saw the desire in your eyes. Those are the leaders we should want to work hard to impress. They invested in you because they believed in you. I love the idea of proving people right because it applies to both leaders and followers. Without someone giving us a shot, we wouldn’t be leaders in the first place.
2. Build Trust NOT Obedience
This seems so obvious. However, ask your-self how many times you’ve used your power or standing in an organization to demand some-thing gets done. In high growth environments, we rely on our people to be proactive, creative self-starters. If your team trusts you as a leader, they will be much more likely to take a chance and do something great instead of just do-ing their job. ‘Trust’ in the Army means many things, but most of all it means ensuring your team has your back and you have their back.
While trust in business is similar, we are not faced with the same life and death situations that soldiers in battle are faced with. But to a young manager, each decision can feel like life and death. Does your team trust you enough to take chances? Do you beat people up for taking chances when they are wrong?
The Army has a saying that “a leader gets the team he or she deserves.” That should resonate with all of us in business. Does your leadership team trust you or obey you? What actions or be-haviors can you eliminate that are eroding trust in your organization?
3. Promote Based on Readiness,NOT Track Record
The Army promotes based on readiness for the next rank and potential, not track record. I didn’t believe this statement when Dan Rice, President of Thayer Leader Development Group first shared it with us. However, several other se-nior officers confirmed this to be the case. Your track record can certainly bar you from consid-eration but it won’t get you promoted. The idea that potential leaders should be evaluated on their potential to lead is a great business concept. In addition, the Army applies a pretty simple test: if you are asked to lead and you don’t say yes, you are likely not a real leader. This may seem a little too black and white for some, but doesn’t it sound right?
Col. Ryan also said, “Your leaders will always have to lead before they feel ready.” That sounds like a high growth company environment to me. Most of the time we are looking for leaders or promoting people to higher levels because our businesses are growing. We never had Account Management before, but now we have so many customers, we need it. Was your first inclination to go out and hire an experienced Account Management executive or did you look for a high potential performer already in your company and give them a shot?
This concept is not advocating for on-the-job training and neither am I. Instead, think about the message you are sending your team if every time you need a new leader for a group or strategic initiative you go outside your company to find that person.
4. Have a Higher Calling
The U.S. Military Academy has eight houses of worship on the base (campus), which is a large number for a relatively small student body of less than 5,000 students, including a non-denominational chapel. The Cadet Chapel is a beautiful building – if you have a chance to visit West Point, make this a stop. The Army’s motto is: Duty, Honor, Country; which is a pretty high calling when you consider that our volunteer soldiers literally put their life on the line to defend our country.
In business, we are fortunate that we are generally not risking our lives to achieve our objectives. Our core values and mission generally have a higher calling, but do we remind our team what that is regularly? The idea that great leaders get commitment vs. compliance from their team is compelling.
There is a lot of talk about how much different millennials are than prior generations. One thing I see in young people is a desire to make an impact on the world around them. They say, “Cynics doubt the Why, while skeptics doubt the How.” If your team is full of cynicism when you talk about your mission statement or higher calling, maybe you need to make some changes. Leaders must continually remind their team what the higher calling is, and if they do, it will increase the odds substantially that everyone is bought in to achieve that calling.
5. Develop Your Own Leadership Philosophy
I have never been given this advice before. Major General Spider Marks (USA, Retired, USMA, 1975) gave us this advice and shared his leader-ship philosophy with us. His was an acronym (everything the Army does has an acronym, by the way): TIPS. Which stands for Talk to your people, Inform your team and stay informed, display Predictable behavior (as a leader), and be Sensitive to your team’s needs.
General Marks’ advice to develop your own Leadership Philosophy seems so obvious. Butwhy didn’t anyone tell me this in my 24 years in business? Consider your leadership philosophy to be the behaviors you will hold yourself ac-countable to, and those your team can count on you to display.
I am still working to make my personal Leadership Philosophy consumable by my team. I know I have one, but I have never written it down. Take some time to write it down and then share your Leadership Philosophy. Similar to your company’s Mission Statement or Core Values, how do you know what it is if you don’t share it?
West Point is a special place and if your company is looking to hold an offsite to develop better leadership skills or future leaders, I highly recommend Thayer Leader Development Group. The focus on character and the whole person were two areas that will have a lasting impact on me. I believe it is safe to assume that everyone who attended the CEO Summit left with actionable ideas to improve their leader-ship skills and to develop leaders within their organizations.
Chris Sugden is Managing Partner, Edison Partners. www.edisonpartners.com.
Feature: Sounding the Alarm
By West Monroe Partners
Acquirers are finally taking note: Cybersecurity has become a crucial part of the due diligence process for M&A. Ignore a target’s data breaches at your peril.
As the value of data rises across industries, companies are becoming increasingly concerned about IT security at deal targets. Eighty percent of our respondents said cybersecurity issues are highly important in due diligence, compared to just 20% who said they are somewhat important. At the same time, 77% said the importance of cybersecurity at M&A targets had increased significantly over the last 24 months, reflecting the rapid growth of risks related to cybercrime and the growing number of costly data breaches.
West Monroe managing director Matt Sondag said acquirers have become much better-informed of late about the risks of inadequate cybersecurity. “When a data breach lands on the front page of CNN.com or The Wall Street Journal, companies start to pay closer attention to the issue,” he said. “In the last 18 to 24 months, we have really started to see the importance of cybersecurity resonate with our clients.”
Indeed, instances of major financial loss due to breaches are becoming increasingly common. In one of the most notorious cases, retailer Target suffered a breach in late 2013 at its point-of-sale systems. As of Q1 2015, the company had accrued a loss of US$252m in connection with the breach and has faced legal action by credit card companies, government agencies, and consumers.
Vulnerable IT systems can indicate poor risk management at a company as well as lead to concrete business losses, said a partner at a mid-market private equity firm with over 80 active investments. “Data security issues that arise while conducting due diligence are highly important, as they are indicators of risk exposure and may lead to damages related to non-compliance or reputational harm,” the PE partner said.
The Proactive Approach
Cybersecurity due diligence is about more than deciding whether a company is an appropriate target, according to our respondents. Almost half (47%) said their top priority for using the information they gain in the process is to plan for fixes – meaning they presume that they will go through with the deal once the process has begun. One-third (33%) said they use the information to decide whether to do the deal and one-fifth (20%) said they focus on negotiating better deal terms.
Respondents who said they prioritize planning for security fixes argued that it was realistic to expect companies to have some issues. “We don’t think there are any companies without inadequacies in their data security,” said a managing director at a mid-market private equity firm focused on industrials and business services. “It is obvious there will be some issues. But we have to know the quantity and complexity of the issues so that we can resolve them.”
One respondent, the director of M&A at a technology firm that completes more than 10 acquisitions a year, said his company needed to determine whether or not to go through with a deal, since data security is crucial to their industry. “Information collected through data security diligence plays the most important part in deciding the future course of the deal,” the M&A director said. “We operate in an industry where data security is of utmost importance and therefore any breach or intrusion could permanently harm the company’s image and operations.”
Assessing the Risks
Whether a target needs a network overhaul or could face legal action over a breach, the potential costs of security problems can be immense.
The practical concerns related to security problems at a target – such as the cost of fixing them and the implications for integration – are often the most pressing, according to our respondents. Exactly half of them said the cost of correcting existing problems topped their list of worries and 43% said future integration issues concerned them most.
The amount companies need to spend to close loopholes or overhaul networks can vary widely, depending on the size of the firm and the scale of the problem. But the cost can easily run into the hundreds of thousands of dollars, even for a mid-market company – and that’s not counting potential legal costs down the line. “Data security is no small thing to deal with,” said a managing director at a PE firm with investments in over 20 countries. “There is the cost of correcting the existing problems, and then the firm could have unresolved litigation or lawsuits that could surface after the deal has closed.”
More than a third of respondents (37%) said they are highly concerned about the occurrence of frequent or recent data breaches. According to West Monroe managing director Matt Sondag, looking at a target’s incident history provides valuable insight into its overall security posture. “One of the first things we do in the diligence process is to ask the potential acquisition about past breaches,” Sondag said.
Almost equally important is to look at the remedial action taken by the firm in response. In some cases, the “battle scars” of going through a breach
can actually make a company strengthen its security policies, Sondag said. Thirty-seven percent of respondents said they especially worried about
threats to customer data, while 33% said threats to business data concerned them. Many executives are well aware of the costs that accompany breaches,
which become more likely if specific threats to corporate data are present. In the 2007 breach of Heartland Payment Systems, for instance, the cost in fines and legal expenses alone reached US$150m, CEO Robert Carr said in 2014.
Compliance In Focus
As privacy laws evolve quickly around the world, compliance issues are the most common and important problem uncovered at deal targets, our respondents said. Seventy percent named them as one of the most frequent data security issues and 30% called them the most important.
In the US, three federal agencies take responsibility for policing data privacy: the Federal Trade Commission (FTC), the Securities and Exchange Commission (SEC), and now the Consumer Financial Protection Bureau (CFPB) as well. In a 2015 case, the US Court of Appeals for the Third Circuit ruled that the FTC could hold companies responsible for weak data security practices that lead to breaches. In an even more surprising case, the CFPB announced a settlement in March 2016 with payments startup Dwolla over privacy concerns – despite the fact that Dwolla had not even experienced a breach.
The scope of oversight appears to be growing in proportion to the scale of data being collected by most companies – and that scale is on the rise. “We have seen an increase in compliance issues due to the vast amounts of data within enterprise systems,” said a finance director at a software firm that makes fewer than five acquisitions a year. “Managing compliance effectively is a top concern, and most companies are seen as being in a weak position due to the magnitude of the data and the complexities of newer technologies.”
Infrastructure Red Flags
Beyond broad agreement about the prominence of compliance issues, opinion was split among respondents regarding the most common and troublesome data security problems at targets. The concerns most commonly seen included the lack of a comprehensive data security architecture (40%), inadequate security on mobile devices (33%), and vulnerable local server storage (30%).
West Monroe’s Matt Sondag explained the process of analyzing a company’s security architecture with the analogy of looking at a person’s home security. “When we look at a target’s network setup, their firewalls, and their overall infrastructure topology, it’s like looking at a house,” he said. “We ask: Do you always lock your doors? Do you always put the alarm on? Do you always shut the windows? Do you always close the garage door?”
“By checking these issues, we can start to understand whether they have processes and procedures in place that will be there in the future and that will ultimately tell us whether a network is secure,” Sondag added.
“Internal systems that are not fully secured usually create the most challenges, since insider risks or threats can arise in the process.”– CFO at a Mid-cap Broadcasting Company
At the same time, an analysis must look beyond the overall infrastructure. “Application security, which includes internal access control, is also key,” Songdag said.
In the realm of mobile security, new safeguards are becoming necessary, such as the ability to remotely wipe a phone or laptop. In the event a device is lost or stolen, fines can be reduced if you can prove that sensitive data was deleted.
Vulnerability to insider threats, cited by 37% of respondents as a common problem found at targets, is a mounting concern. A 2015 study by IT industry association CompTIA showed that a slight majority of security breaches (52%) result from employee action, whether malicious or unintentional, as opposed to outside attackers. “Internal systems that are not fully secured usually create the most challenges, since insider risks or threats can arise in the process,” said the CFO at a mid-cap broadcasting company.
Interestingly, in terms of importance, the problem cited second-most by respondents was the lack of a data security team (17%). The CFO at a telecommunications company said locking down technical systems can prove challenging without properly trained IT personnel. “The lack of a dedicated team makes it difficult to ensure adequate specialization and effectiveness in managing security concerns,” he said.
A new study by West Monroe Partners and Mergermarket, Testing the Defenses: Cybersecurity due diligence in M&A. West Monroe Partners is a business and technical
Mastering Big Data
By Patricia Quigley
The world of data analytics is upon us, and the ability and knowledge to know how to mind big data is becoming an increasingly valuable skill.
Consider These Three Things:
1. Researchers from Microsoft discover evaluations of people’s online activities can be used to identify five to 15 percent of those with pancreatic cancer.
2. Companies improve their market footprint when they use technology to detect buying patterns.
3. The U.S. government assesses data to determine if Medicare fraud is being committed.
Crossing Many Fields
This is the world of data analytics – also known as “Big Data,” data science or data mining – in which researchers, businesses, government personnel and others can automatically identify data patterns that can not only provide insight into their customers and consumers but also improve their bottom line.
Two computer science professors at Rowan University, in Glassboro, Drs. Adrian Rusu and Anthony Brietzman, last year created a master’s degree program in data analytics to address the increasing need for well-educated professionals in what is becoming a more high-demand field.
“There are millions of applications for this,” Brietzman said of data analytics.
Indeed, mining big data is becoming an increasingly valuable skill. The SAS Institute, a developer of analytics software based in Cary, North Carolina, predicts that the number of employees needed to handle big data tasks will grow by more than 240 percent by 2017, creating a shortfall of hundreds of thousands of employees in the U.S. alone.
Today’s and tomorrow’s professionals in the field are primed to help their organizations financially as well. Some estimates predict that the healthcare industry alone could save billions of dollars by using big data health analytics to mine electronic records such as prescription orders, clinical studies and insurance claims. Big data analysis also can identify clinical treatments, prescription drugs or public health interventions that may not appear to be effective using smaller samples or traditional research methods.
Healthcare is not the only field that benefits from data analytics. Expertise in the field can be applied to virtually every industry to improve processes and increase competitive advantages, including professional, scientific and technical services; information; manufacturing; retail; sustainability; waste management and remediation services; and financial and insurance areas.
The Rowan Program
Rowan’s 11-course, 30-semester-hour M.S. in Data Analytics was designed to meet the ever-growing need for professionals who know how to extract and analyze big data to make effective decisions, solve complex problems, influence health policies and more.
At Rowan, professors teach students how to extract data using the latest techniques and how to interpret and apply the data in their particular field.
The program includes a Health Data Analytics specialization that aligns itself with New Jersey’s Health Sciences initiatives as well as Cooper Medical School of Rowan University, Rowan University School of Osteopathic Medicine and Rowan’s School of Biomedical Sciences.
Students who successfully complete the program will be able to apply data analytics in the healthcare industry and process and analyze complex and voluminous healthcare, pharmaceutical and clinical research data. The program prepares graduates for careers in pharmaceuticals, hospitals, tele-health and clinical research settings.
The associated Computational Data Analytics specialization is designed to benefit non-healthcare- related fields such as business, journalism and law enforcement.
Built into the Data Analytics program is a one-credit, 12-month lab during which students gain real-world experience by using the techniques they learn to solve specific problems submitted by Rowan’s business and industry partners.
For more information about the program, visit: www.RowanU.com/Data or contact Dr. Adrian Rusu at email@example.com.
EDUCATION: An NJIT Student Takes on Tech’s Gender Gap
By Jinisha Patel as told to Shydale James
I grew up in India and moved to the United States nine years ago just as I was starting high school.
It was hands down the worst experience of my life.
I had a thick accent and got hit with a huge dose of culture shock. All my teachers and everyone around me spoke fast. I always felt like I couldn’t catch up. My GPA hovered around a 2.0 and was steadily dropping.
Coincidentally, I got placed into a class called Intro to Java. I had no idea what that meant. I thought Java was coffee. But I gave it a shot.
As I immersed myself in the computer program language, I started to gain focus. Learning computer science helped me to perform better in all my other classes. Soon, my GPA rose to a 3.0. It was hard work, but it was work that I didn’t mind doing because I had finally found something I could relate to. It was invigorating.
It wasn’t until after I graduated from high school and began community college that I discovered the gender gap in the tech field. I noticed one of my professors favoring all the men over me. It wasn’t until I looked around the room that I realized I was the only woman in the class.
When I landed an internship at Cisco my freshman year, my peers told me I only got the job because I was a girl, as if my talent and skill had nothing to do with my being hired.
Those constant nudges started to really affect my confidence.
That was the day I vowed to use my time at NJIT to become an advocate for women in computer science.
Women make up around 47 percent of the workforce in the United States yet companies like Google, Microsoft, Twitter—any major tech company you can think of— say 20 percent or less of their technical staff are women. That drives me crazy.
Technology is everywhere. You can’t escape it. So I want everyone—especially women—to have the chance to explore it and personalize it. That’s what technology does: It helps us express ourselves. That’s what it continues to do for me.
Whenever I meet a high school girl who’s unsure if she wants to study computer science, I encourage her to consider it as a minor. I even do it here at NJIT with my sorority sisters.
I find that young women are turned off by the prospect of programming based on their misperceptions of the profession. “I don’t want to be a programmer and sit at a desk and code all day,” they often tell me. But that’s not an accurate depiction of the job.
When I was a programmer at Cisco, I worked from the beach. It was awesome, and the flexibility is great. You can program from anywhere. Also, computer science isn’t just about programming. You can do so many other things in technology. You don’t just have to be a software engineer.
Last year, I ran a Girls Who Code club. I was really nervous standing up there in front of all those impressionable young women as they looked to me to encourage them to give computer science a try.
Turns out, they ended up inspiring me. They inspired me to be a stronger advocate, a better programmer…to be a better role model.
As computer science educators, advocates and motivators, it’s up to us to inspire, influence and spark the interest as early as possible.
The best student in my Girls Who Code club was 4 years old. She learned to program using “Let it Code with Anna and Elsa” on code.org. It was a bit hard to communicate with her because she was only four, but I was so impressed at how easily she understood the instructions and completed the assignment.
This is why it’s imperative that more women are included in and help to create the dialogue around tech. There need to be more female leaders in the tech sector placed in the spotlight. We need more women on the front lines fighting to reverse the impostor syndrome that permeates the workplace, especially among the underrepresented.
It’s the best way to give other women and young girls the confidence they need to step into the male-dominated field, equipped with the tools to thwart the inevitable stereotypes and gender biases sure to come their way.
I would probably still be the sheepish girl in the corner of that all-boys classroom in community college, struggling to find her voice if it hadn’t been for attending the Grace Hopper Conference or the National Center for Women & Technology, where I was introduced to a boatload of new technologies and got to stand in solidarity with powerful women, working to debunk the myth that coding and programming is a man’s job.
It’s the reason why I created the Women in Computing Society club here at NJIT: to create a sisterhood and instill confidence in women.
If young women don’t see people who look like them in positions of power in the tech industry, how can we expect them to aspire to be the next Steve Jobs or encourage them to pursue careers in computing?
Recently, I saw one of the young ladies from the Girls Who Code camp. She ran up to me and gave me a warm hug. I was shocked that she remembered me. As we broke from our embrace, she looked up at me with a bright smile and said, “I’m going to be a computer science major.”
Remember, representation matters. If they can’t see it, it makes it twice as hard for them to believe they can be it.
Jinisha Patel graduated from NJIT in 2016 with a B.S. in computing and business. She’s currently a technology associate at Bank of America. When at NJIT she majored in computing and business. She—along with computer science professor James Geller—were instrumental in NJIT’s crusade to bridge the gender gap and increase awareness around the lack of diversity in computer science and STEM.
In 2015, Patel was the only U.S. college student to speak at the United Nations Global Compact Women’s Empowerment Principles event. She was also a panelist at the Murray Center for Women in Technology Conference and was the president and a founding member of the Women in Computing Society at NJIT.
In addition, Patel volunteered at the White House in the Office of Science and Technology Policy. She helped to plan a computer science tech jam and a hackathon that comprised of educators, students and professional developers, who came together to find creative solutions to solve the lack of K-12 computer science education in the United States.