Stifling IT Innovation

When the board says, "Be more innovative," many CEOs turn to their CIOs. Requests for innovation also come from other departments after they hear about new technologies from vendors or trade magazines. As a result, many IT organizations are being told to be more creative, and articles stating that the CIO should become the "chief innovation officer" abound.

If IT doesn't provide some of the innovations requested, other departments may look elsewhere. Many vendors are only too willing to bypass the CIO and sell to other executives directly. These sometimes haphazard technology additions may include products that are harmful to the company's infrastructure. In addition, they may be installed without adequate consideration of compliance requirements, architectural integrity, documentation needs or security and backup issues.

But industry changes in recent years have made it increasingly difficult for most IT organizations to innovate. Here's why:

Political and financial pressures. Y2k efforts consumed massive financial resources without providing many visible benefits. (Disaster prevention is a thankless job.) Many business executives concluded that IT had seriously overspent and underdelivered. Combine that mind-set with the huge expenses and unmet expectations of the dot-com bubble, and the result was that many CIOs and IT organizations lost their credibility. When the recession hit, IT budgets were slashed, and many CIOs were forced to cut virtually all discretionary spending. That funding has been slow to return to most IT budgets.

Outsourcing. While outsourcing has many benefits, it often results in brain drain. After major outsourcing efforts, the character of the remaining work is substantially different, shifting from development and operational concerns to monitoring and managing the outsourcer(s) and programs. Many innovative developers go elsewhere.

Laser business focus. Successful executives require the use of business cases to ensure that projects will meet corporate business needs. But an overly heavy focus on provable, quantifiable ROI frequently discourages funding those "creative leap" projects that are often necessary for breakthrough innovation. For example, ATMs originally showed very low ROI and were considered a financial risk.

Re-engineering failures. Re-engineering can generate creative and innovative solutions to problems. Because of some spectacular failures in recent years, however, re-engineering efforts have been largely (often unfairly) discredited and mostly abandoned. Many specialists have moved to other disciplines.

The nature of IT. Delivering and supporting IT capabilities in today's business environment requires more logic, discipline and attention to detail than creativity. For example, an effective systems development methodology requires compliance, not innovation.

What's a CIO to do? There is no "creativity pill" for your IT organization. At a minimum, innovation requires four things:

  • People. Leverage the talents of your naturally creative people, borrow some from other departments (such as marketing or R&D), or hire consultants to help generate innovative ideas.
  • Process. Advertising and other creative professionals employ various tools and techniques to foster creativity. Implement your own techniques for encouraging the creative process, as recommended in recent industry publications.
  • Perspective. Make a conscious shift. Most people, including IT staffers, instinctively focus on day-to-day issues rather than long-term creative solutions. Consistently allocate some management time for focusing on innovation. (Your job may depend on it someday, whether or not it appears in your performance objectives.)
  • Public recognition. Reward innovation publicly, and use financial incentives and other perks specific to your company's culture to encourage creativity.

In addition, synchronize your innovative endeavors to your company's business cycle. Companies experiencing downturns are often unable to fund expensive innovation efforts. But, as Clayton Christensen warns in The Innovator's Dilemma (Collins, 2003), successful, complacent companies must ultimately innovate or die.

Above all, manage executive expectations regarding staffing and scheduling. Innovation is a process, not a project. Great ideas often require a long incubation period. They can't be scheduled or mandated. 3M, noted for producing many innovative products, gives its researchers a percentage of their work time to pursue projects that interest them, without a required outcome. The company recognizes that an innovative idea may take months or even years to bear fruit. Many of 3M's most notable innovations have come from these research efforts.

Unfortunately, today's IT organizations are often not structured to innovate effectively. Unless your corporation is willing to foster a creative environment, employ appropriate staffers and support the creative process (both politically and financially), innovation will be stifled. Be realistic about what innovation requires. It's hard to leverage what you don't have.

Bart Perkins is managing partner at Louisville, Ky.-based Leverage Partners Inc., which helps organizations invest well in IT. He was previously CIO at Tricon Global Restaurants Inc. and Dole Food Co. Contact him at BartPerkins@LeveragePartners.com.

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