Actually the rest of the statement adds the phrase; to ‘Business Innovation’ which leads to the sad finding in the annual Capgemini CIO survey that IT departments find themselves in fifth place when it comes to innovation in the business. This places them behind Sales, Marketing, Operations, and R&D, but that the driver for all these areas is certainly Technology, and you could say IT, in one form or another. Well, there are potential answers to this question contained within the survey responses about what is wanted, how what is delivered is received, etc, so I recommend reading it carefully with the following thought in mind to interpret the findings.
I believe that there are two characteristics that are confining the role of what should be the skill centre of the enterprise in driving the use of ‘technology’ for the support of the business. First the focus of the IT department has largely been defined as internal support towards supporting administrative operations, usually under the control of the CFO; Second as part being successful in delivering to this scope, IT departments find themselves only able to make business cases around cost reduction. In other words the definition of the role stops them playing a full part in the innovation cycle in the same way as Sales, or Marketing in particular where justifications are normally around increased revenues, market shares, margins, etc.
In the IT department of today Innovation around cost is seldom more than evolution of supporting what is there, and for many CIOs and IT departments they are judged on nothing else, indeed are often hired just for their skills in this role. However what the survey shows is that an increasing number of CIOs recognise that this is not enough, but are frustrated in how they break out to play the role of helping the business use technology more strategically. And that to me is the trap; it’s not the whole business that innovates, its small groups within the enterprise coming across an opportunity to ‘change the game’. That means you have to figure out how to operate an engagement model that allows these people to come to the IT department for support in developing their idea, shadow IT, or even what is currently a down right unsafe practice, into a business valuable innovation as judged by their operational area key performance indicators, and not by the IT department key performance indicators.
That’s less about being awarded the role of ‘innovation’ at a board level, and more about acting to create an innovation support environment within the IT department, more akin to being an internal Venture Capitalist. The basic role of a VC, in the external world, is to develop a promising start-up into a valuable business. Am I advocating money? No. It’s the skill investment, and may be some space on a ‘safe’ server, that’s needed, because many of these opportunities will not be about conventional IT, and a business case in lowering the cost of administering internal operations. In fact they will challenge the existing IT function, and its current role, by expanding it into new fields around new technology. And that means the innovators will have to find their own business case to show to their own department around its goals; sales revenue, market share, etc.
The second element of the trap is that by definition ‘innovation’ is not comfortable to an existing state, so the first reaction of most professional IT staff is to stop these things wrecking the existing systems that the Enterprise relies on. Well, that’s not worked in the past; think PC, Smart Phone, Internet, and now Web 2.0, so all this does is drive innovation based on new technology underground where it will expand until there is a very real chance that it will cause a serious problem to the existing systems. Supporting or enabling may be painful in the short term, but in the longer term it’s safer!
With that thought in mind now read the survey, and see what it suggests to you about the role, and the issues, that CIOs and IT departments are grappling with, and in some cases succeeding around. In its self it may be a help as the reference document for an internal management discussion on rethinking resetting some of the key performance indicators for IT within the Enterprise.