Innovation and the unrecorded enterprise conversation

While the enterprise media fusses over vendor minutia, vital conversations go unrecorded - or so Vinnie Mirchandani contends. During a recent catchup at Workday Rising, Den got some fresh views from Vinnie with his latest book project underway.

I followed up with Vinnie after Dennis released the above video on customer innovation. Vinnie tells me these particular bits aren't published elsewhere, so that's one more reason to bring them to light here.

But as interesting as the stories are, the reasons why Vinnie compiles them are just as provocative. Vinnie has a habit of pushing his fellow bloggers/analysts (including myself) to move off the beaten track of the conference circuit and do primary research with customers.

It's a great argument to have because it shifts the focus back to customers, and how the best companies are moving beyond a stale view of IT-as-cost-center. A better approach? Using technology to make smart products and change industries, a focal point of Vinnie's last book.

These are the 'unrecorded' conversations Vinnie urges us to document. As he recently put it:

Every 18 months or so as I do book research for 3-4 months, I become acutely aware of those "unrecorded conversations". While Oracle has had the social net spellbound with its cloud announcements this week, my calls to companies around the world don't seem to be even aware of them. They are telling me about complex events processing, semantic memories in their products, Industrial Internet applications in their industries.

In case it isn't obvious, Vinnie isn't picking on Oracle, he's picking on, well - people like me. And Twitter pundits in all variety of pajama wear lapping up press releases.  For Vinnie, that means ramping up the research. The context? He's been working on a book with the CEO of Software AG called The Digital Enterprise. His summer itinerary: 30 brands, 15 industries, 10 countries. Vinnie on his travels:

Truly invigorating - and revealing in that very little of what they are doing will likely show up in analyst reports or tech media, and then not for a few years. And probably never on Twitter.  These are not cool social or  mobile apps, but complex, multi-technology initiatives that I call systems of (competitive) advantage.

Revenue-centric innovation you might not see on Twitter

With research like this, it's all in the details. The video brings out some of the case studies Vinnie is documenting. As Vinnie explains, most of the innovation he is tracking happens in product-focused areas. That means embedding technology in products, making products smarter, or changing how that product is built and distributed.

The result? Revenue-centric innovation. Products lead to customers and then to revenue. Vinnie cites the example of Industrie 4.0, a working group developed by former SAP CEO Henning Kagermann, now the President of the German National Academy of Science and Engineering. Several German companies told Vinnie about how these approaches are 'revolutionizing' their manufacturing and distribution through advanced robotics, augmented reality training, and next generation logistics.

Vinnie cites Nissan and steering innovations on the new Infiniti. Daimler on 'semantic data reconciliation.' Then there is GE's work with turbines, where each turbine can talk to its neighboring turbines and change its pitch depending on how that neighbor is performing. Vinnie added via email:  'A GE executive I interviewed for the book said 'The greatest software companies in the world don’t sell software.'

Examples also include complex event processing (CEP), findings Vinnie previewed in his blog. CEP is moving from financial industry adoption to a range of applications. It's about pulling in data from all kinds of feeds (including sensor and locational data) for potent results. Vinnie quotes Dr. John Bates:

CEP can shut down fraud while it is happening, push a marketing offer to a customer while they are in the right place at the right time or detect and place an algorithmic trade in microseconds, before a competitor spots the opportunity.

A key point from this research? Vinnie talks about 'systems of advantage'. That means moving beyond 'systems of engagement' to systems that have a built-in competitive advantage, resulting in category-defining products. The catch? Your advantage with smart products is fleeting, so your drive to improve upon those systems must be relentless.

Smart pralines for the win?

But the most memorable example might be pralines. That's right- nuts. At the 9:00 mark in the video, Vinnie talks about the promise of mass customization becoming reality, via a box of pralines embedded with a memory chip:

The box of pralines then drives the shop floor and says, 'Take me to Filling Station A. Now take me to Filling Station B. Now take me to Pay Package Station 1.' So the whole MRP concept has been turned around on its head. It's not recipe driven. It's driven by the customer order. When the box of pralines is getting shipped, it's talking to the DHL truck and saying, 'I can sense the temperature is a little too hot. Can you turn the temperature down?'

Once in the store, the pralines continue chattering, but now to the customer's mobile device, informing the customer of the price, alternatives for those with nut allergies, and at home, conversing with a healthcare app and reminding diabetics to take their insulin shots.

Is the tech media sleeping?

Vinnie thinks the tech media is sleeping on a very big story: customers are now the innovators. They aren't waiting for 'vendor release 5.0.1.3' to get cooking:

Every one of these areas in their industries, they're pushing the envelope. They're using technologies that are generally available., but they're the innovators. They're not waiting for a big vendor to come along and say, 'Here is a solution' That's a massive shift that's going on ... So just in the last few years, we've seen a revolution happen. I think the media and the analysts have missed this transition.

That's not to say there aren't vendors Vinnie respects and follows closely. He likes where some are headed more than others. Ergo, Vinnie and I have jousted about SAP HANA before and probably will again. For me, the takeaway is not to march in lockstep with Vinnie's views but to push away from the social stream and dig - for the unrecorded conversation. And if you can't find the innovation you seek, build it.

Image credit: Young Man with Magnifying Glass © bajinda - Fotolia.com
Disclosure: SAP and Oracle are diginomica premier partners as of this writing.