Innovation Rising

Innovation Rising

Smart CIOs are conducting strategic experiments by working with a business sponsor, then running the experiment like a venture capital company and tightly time-boxing the experiment.

She is a strong believer in nurturing an innovation-friendly culture. "Nothing stifles innovation faster than passive resistance, lip service and white-anting. People look to see what gets rewarded in organizations so if you don't reward thought leadership and creativity you won't have any."

Barnett believes innovating organizations encourage creative restlessness, effectively align business and IT, and have an IT management model that is strongly commercial with high business acumen. IT departments themselves need to demonstrate courage and self-confidence, be prepared to take measured risks and demonstrate thought leadership rather than an order-taking disposition.

"Innovation is a non-linear and unpredictable phenomenon," Barnett says. "Successful businesses focus more on culture than processes where innovation is concerned. However, it is important to ensure you have enough processes in place to catch the ideas, bring them to the attention of the right people and act on them fast. The cultural aspect is really about providing people with the opportunity to contribute to the business agenda and make their work environment better and more productive."

But at the end of the day she is not a fan of innovating for innovation's sake. "There's not much point in innovating unless it drives business value for either the broader business or the value proposition of the IT department," Barnett says.

Geoffrey Moore, author of the recently published book Dealing with Darwin: How Great Companies Innovate at Every Phase of Their Evolution, agrees with that sentiment. "Too many managers believe innovation is a good thing in itself. This is not true. Innovation is an expensive thing in itself, and frequently also a risky thing so it must generate economic returns," Moore says.

HBS's Austin demurs. "Successful innovators innovate for the sake of innovation," he says. "Being too ends-oriented in innovation usually results in incremental innovation at best. One of the paradoxes of innovation is that to produce really important innovations, one needs to avoid being too goal-directed - you have to have room to explore, to stumble, to make interesting mistakes."

AAPT CIO Bob Hennessy also supports that view. "The juices flow all of the time or not at all," he says. "It's only where innovation flows all the time that you build the luxury of a deep pool of ideas from which to choose those that really will make a positive difference in the business. Not everything new is valuable, but increasingly new value tends to come from new things."

Hennessy describes himself as an interested observer rather than any sort of innovation expert, but says that "I did happen to get reasonably close to 3M's chief architect in the US at one stage, and that company has a great reputation for innovation. What was clear to me about the company, and this may well be able to be generalized, is that it was extremely clear what the point of technology was in 3M: to serve the business," Hennessy says. "There was no debate about whose needs were paramount.

"The very distinctions still made about IT and the business, as if somehow IT aren't the business, create an environment in which the needs somehow have to be reconciled. When the business owners of processes, problems and opportunities look seamlessly at the skills and competencies available to them to improve their business they will look to have IT skills embedded in the mix."

Those IT skills will also have to shift depending on where a company is in the innovation cycle, according to Moore, who sees innovation as a cycle that must be constantly tended in order to escape the inertia that follows innovation. He sees this as a particular challenge in IT because "there is so much inherent legacy [that] the willingness to embrace disruptive innovation, even for 10 times gains, is muted".

IT Breaks Free

Moore breaks innovation into three components: invention, deployment and optimization. After the innovation is invented and deployed, the trick is to ensure that the people who invented it and deployed it are not shackled to their project, but freed from it to start on the next innovation, leaving the optimizers to run the show. In essence he argues for a workforce broken into teams of inventors, deployers and optimizers in order to avoid the inertia that follows innovation.

Moore also warns that for IT to innovate it must break free of inflexible internal IT architecture and replace Internet-enabled client server architecture with Web services architecture that he argues is the only sensible platform for future innovations. So not only is IT challenged to deliver the benefits of innovation to the bottom line, it is also to completely overhaul itself in order to do that effectively.

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