Cogitation on innovation

Profile picture for user slauchlan By Stuart Lauchlan December 1, 2013
Summary:
No industry conference will pass without due deference being paid to that holiest of grails, IT enabled innovation. If you play buzzword bingo at any major event, your card will be filled up pretty darned quickly with clarion cries urging you on to innovate, innovate, innovate.

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Adrian Simpson

What’s the big word du jour? It is of course innovation.

No industry conference will pass without due deference being paid to that holiest of grails, IT enabled innovation. If you play buzzword bingo at any major event, your card will be filled up pretty darned quickly with clarion cries urging you on to innovate, innovate, innovate.

Which is all well and good. I’ve nothing against the basic principle of the idea at all, not one little bit. But I do worry that the term itself is rapidly losing its real currency and becoming just another empty phrase to be parroted with little real consideration as to what it actually means.

I raised this question with Adrian Simpson, Chief Innovation Officer at SAP UK, last week in Birmingham. “What, "I said, "is innovation?”.

He looked a little startled at first - it’s sort of one of those questions I suppose you don’t really expect to get asked when you’ve got innovation in your job title! Sorry Adrian! - but quickly warmed to his theme:

"Innovation just means doing things better .

"It’s a simple statement, but if we can do things better than we have done in the past then that’s innovation. That might mean doing new things or combining new things or doing things differently."

He cited an SAP practice referred to as ‘design thinking’ as a case in point - a set of methods that enable you to put yourself in your customers shoes:

“What do you want that experience to be like. What would things look like it was day one.

"How do you bring a set of tools together that don’t just tweak away that things as they are today but look at how we would do things in a different shape.

"What would would you like the future to look like? You have to think in that sort of mind-set."

I was curious as to whether Simpson saw this as business or an IT driven idea:

“It is much better as a business conversation had by the people who will be affected by what ‘better’ would look like for them.

"It is the acid test though of how far the CIO is engaged with the business. Do they have the kind of mindset that is open to ideas coming from the buiness?

"But there will be some CIOs who just say ‘we have our plans and our three year road maps’."

Hanging unsaid in the air was what the fate of such individuals might end up being…

Shifting away

With that in mind, I was interested to note some of the findings of a study of 165 organisations by CEB, the advisory board formerly known as the Corporate Executive Board.

This comes to the grim conclusion - well, grim from the view from the CIO’s office at any rate - that the IT department has lost its mantle as the driver of technology innovation to other parts of the business.

At first this might seem to be heading perilously close to Gartner’s fabled ‘CMO v CIO power struggle for the IT budget’ meme, but in fact the CEB conclusion is closer to my own idea that it is line of business in general, rather than CMO in particular, that is getting to grips with IT.

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CEB’s findings are that the likes of HR and finance and yes, marketing, are now spending over 4% of their own LoB budgets on innovative IT projects. (That can go as high as 9% in the case of the HR department where cloud HCM and a push for analytics to assist support talent management initiatives combine to bump up spending.)

The study - Findings from the 2013–2014 IT Budget Benchmark - notes:

  • CIOs estimate that other central corporate functions’ spending on IT is, on average, above 4% of their budgets.
  • Ownership of new work environment projects will shift to business partners who are eager to experiment on their own.
  • IT will need to redesign its business engagement model to ensure that technology spending outside of IT is “healthy”, ie: spending that enables business partner innovation and experimentation.

Andrew Horne, managing director at CEB, said:

“While the idea of ‘shadow spending’ has in the past been seen as a risk or threat, on the contrary it is often a sign of healthy innovation and presents a valuable opportunity for IT to work more closely with business partners to develop new capabilities.

“Failing to recognise the extent to which tech-driven projects are happening outside of the IT department can be a real worry, yet trying to maintain total control is equally a step in the wrong direction.

“By getting this balance right, CIOs can help the business to be more flexible, identify potential cost savings and ultimately implement change and innovation more easily.”

“The fact that innovation is happening in the business, rather than the IT department, is a reaction to the fact companies have not been able to carve that spending out of the IT department.”

Verdict

Power shifts in search of innovation and those who will pay for it.