IT’s Star Role in Innovation


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It could be a modern Cinderella story. As chief executives struggle with harnessing product innovation to their corporate carriages so as to propel sustainable growth, one of their most promising assets could actually be hiding in plain sight. It’s their company’s under-appreciated IT department.

It’s not that IT work goes unnoticed; it’s just that it’s more often seen as a housekeeping function than a strategic source. Indeed, a 2010 survey conducted by Harris Interactive revealed that CEOs consistently rank IT as the most innovative of their companies’ functional organizations.

In fact, in business after business, IT has long been tasked with improving company service levels, integrating new technology, and supporting a growing array of applications – all while keeping costs under control. The best companies have even turned this capacity for doing more with less into a competitive advantage. Even so, chief executives and directors rarely invite IT to the innovation strategy table.

So just how can companies leverage their IT’s enterprise innovation skills to increase product success rates and exploit new market opportunities? Take a closer look at the problem: why companies need to improve their product innovation management in the first place.

Following the near-death experience of the Great Recession, companies now face a global business environment marked by accelerated speeds and regionalized economic cycles. Nimble competitors, seemingly coming from nowhere, quickly stake claim to new market opportunities. Product lifecycles contract. And emerging markets no longer settle for glocalized products.

In response, executives are clearly seeing the need to get the right products into their customers’ hands as quickly as possible. In fact, according to a Boston Consulting Group survey, more than 70 percent of senior executives said that innovation is one of their top strategic priorities. But to get there, they need to build a different kind of operational model. Specifically, a model that can:

  • Match their innovation initiatives to strategic business objectives
  • Reprioritize initiatives and product portfolios in response to changing market conditions
  • Balance investment in sustaining current products versus disruptive initiatives
  • Infuse customer responsiveness into everyone, regardless of their job
  • Uncover new market opportunities and respond with the right products

Making that kind of operational model work requires an agile approach to innovation management. It also requires continuous alignment between executive and development organizations. We call that model strategic agility. Through it, executive strategy stays in tune with market conditions. Functional organizations react in unison to changes in that strategy. And a set of operational practices and supporting technologies is then defined to keep all eyes focused and all hands synchronized.

However achieving that organizational alignment is easier said than done. A 2009 global executive survey on managing innovation by PTRM Consultants confirmed that more than 60 percent were concerned about their ability to link strategy with execution, and that 50 percent of their R&D investments never saw a return.

More than any other enterprise entity, IT comprehends the data, process and automation needs of each departmental function. Innovation management in general, and strategic agility in particular, requires technology to make data instantly and globally accessible with support services that span the enterprise. So here are just a few of the areas where IT can assume a leading role in implementing strategic agility.

  • Define the requirements and access policies for a global repository to house market and economic data, resource capacity, market assumptions, business plans, product requirements, and schedules.
  • Define standards, methods and interfaces for acquiring real-time market data, communicating with external stakeholders, and capturing data stored behind firewalls in repositories and static formats such as notebooks, spreadsheets, presentations.
  • Define traceability and auditing policies to ensure that changes in data, strategy, priorities and resources remain consistent throughout the enterprise.
  • Work with IT software vendors to ensure that available technology supports the company’s needs for strategic agility.

Finally, IT’s role in servicing a broad customer base presents an opportunity for companies looking to improve product idea management. IT can use this expertise to create processes for analyzing, selecting and prioritizing ideas gathered from internal and external sources.

Companies that adopt strategic agility can markedly improve their performance. Measures of success can include deeper market penetration, higher ROI, lower R&D costs, higher percentages of revenue from new products, stronger margins, and consistent growth patterns. According to Gartner, companies employing data-driven, predictive decision-making outperform their peers by as much as 25 percent across many of these metrics.

The opportunity is tremendous. The rewards are clear. But strategic agility requires executives to embrace change. And a happily ever after ending is available to those who succeed. But midnight is approaching for many, and getting home can only be done by shining the spotlight on IT.

Republished with author's permission from original post.

Christine Crandell
An accomplished and passionate leader, Christine Crandell has over 20 years strategy and marketing experience in enterprise technology. An expert in defining, implementing and sustaining transformative strategy, Christine is a serial CMO and has served as CEO, COO, and board of director advisor to dozens of early and growth stage private and public companies.


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