FAQ: Four criteria for an effective IT innovation strategy

In this FAQ, IT executives share four ways to kick-start and manage an IT innovation strategy that drives business value and transformation.

An IT innovation strategy is interpreted and developed based on industry sector, customer needs and business goals, so innovation strategies differ from organization to organization. Interviews with CIOs, however, show that innovative IT organizations share certain traits. In this FAQ, IT executives outline the drivers behind their IT innovation strategies and talk about what it takes to develop an effective and sustainable approach to continuous innovation.

One important component of an IT innovation strategy is creating a culture of innovation. In many cases, that process starts with the removal of impediments to the creative process. These blockades can be found anywhere in the organization, from corporate management down to the technology being used to share ideas.

This FAQ delves into the various paths IT executives have taken to remove impediments and foster IT innovation. It touches on how an IT innovation strategy can be introduced and thrive despite it being necessary to resolve short- and long-term business challenges. The FAQ also reveals how IT innovation creates business value and leads to business transformation.

How are IT executives creating a culture of innovation?

Bryan Smith, CIO and vice president at Volvo Construction Equipment North America Inc. in Asheville, N.C., downplays the role of the individual CIO as a source of innovation. To him, the CIO has a role in coordinating organizational teamwork, and that means making sure every team member has a role in creating an innovative environment.

"In my position, I am more of a business guy who understands information technology," Smith says. "I don't come strictly from the IT side."

"But as part of the process, we really believe that everybody on the team needs to understand what other people are working on," he says. "You might have a subject matter expert in one area, but everybody in our organization, in my team, needs to understand what the goals are, and everybody needs to be aligned with that."

Successful organizational teamwork, Smith says, is the collective ability to manage and deal with change, or as he says, all about getting out of your comfort zone. People who resist change, he says, "frequently … will take themselves out of a game one way or another because it's too uncomfortable for them."

Manulife Financial Corp.'s CTO Harry Pickett's plan for IT innovation is similarly based on the idea of tapping a large group -- or crowdsourcing -- for new ideas.

"I don't believe that an innovation team or somebody's going to have a monopoly on good ideas," he said. The question is, "How are we going to make that whole experience in Manulife to allow our employees to actually generate good ideas, and how are we going to make them happen within the company itself?"

Pickett now is focused on setting up the underpinnings for that to happen. Manulife has a Notes email platform and has formed centers of excellence around certain disciplines, such as outsourcing, which solicit ideas from across the company.

How does the adoption of new technology lead to IT innovation?

When Roy Rosin, vice president of product management and innovation at Intuit Inc., began developing innovation management programs, the complaints started to roll in. At the top of the list was the collaboration technology used to share ideas. It was a mishmash of many tools, and employees dubbed the platforms as a place "where ideas go to die."

Rosin, in turn, challenged employees to build a better platform. They came up with Brainstorm, a homegrown system that "connects ideas to people who can help shape them and improve them or to decision makers who can act on them," Rosin said.

Take, for example, the director who was wary of letting his employees use NASA's internal social media platform to ask and answer questions and share ideas. According to Kevin Jones, NASA's social media organizational strategist, this director was concerned that his employees would post something stupid, spell something wrong or take a shot at another group. "If we don't have a good trust culture, trying to do anything social is very difficult," said Jones, who was hired to help break down barriers to sharing ideas at the federal space and aeronautics center.

Cloud computing is another example of how a technology can help or hinder innovation. It has been suggested that the cloud will somehow replace internal IT innovation as more of an organization's IT operations are outsourced to this new service delivery model. Niel Nickolaisen, vice president of strategy and innovation at EnergySolutions Inc. in Salt Lake City, begs to differ. Rather, he contends, cloud can be a driver of innovation. Using services that exist in the cloud can free an IT department to try different business rules and technical alternatives "on the fly," all without the burden of absorbing the services into existing infrastructure.

For Steven John, CIO at H.B. Fuller Co., the cloud played a prominent role in the complete revamping of an IT department ravaged by years of unfocused outsourcing, neglected systems and "shadow IT."

How do you resolve business challenges while still fostering IT innovation?

When Christophe Deslandes joined KapStone Paper and Packaging Corp. in 2007 as CIO, he got what he calls "a once-in-a-lifetime opportunity." The newly formed company had grown overnight that year from nothing in annual revenue to $300 million when it bought its first paper mill.

Deslandes had 18 months to get KapStone off the seller's legacy IT systems and replace them with an architecture and infrastructure that could support the new company's aggressive growth-through-acquisition strategy. By 2008, Northbrook, Ill.-based KapStone would acquire a second mill and more than double its revenue, and other acquisitions are on its horizon."We didn't have a website. We didn't have a domain name. We didn't have an email system. No network, no enterprise resource planning, no nothing. We were starting from scratch," he said.

More on IT innovation strategies

CIO Atefeh Riazi: IT innovation requires breaking some eggs

Technological innovation now a full-contact sport across the C-suite

D&M's CIO spots process levers for IT innovation

Getting off legacy IT systems is no walk in the park under any circumstances, but it is especially intense when the systems belong to a competitor that is charging you dearly for their use. For Deslandes, the race to meet that 18-month deadline (and actually beat it by three months) turned out to be a continual balancing act between adopting IT innovation and minimizing risk; between building a platform for growth and keeping costs under control; and even between fostering the right mix of enthusiasm and caution among his team members.

Some argue that IT innovation is more important than ever in a time of economic crisis. But how can CIOs continue to do more with less and at the same time be pioneers in the field of IT innovation? James A. Champy, author and chairman of consulting at Perot Systems Corp., says that IT plays a critical role in innovation and must become an enabler to the business to be successful.

How does IT innovation lead to business transformation?

IT innovation can improve the business through technology in a variety of ways. Ed Trainor, formerly CIO at Amtrak (aka National Railroad Passenger Corp.), viewed IT as an enabler of business-driven transformation. For instance, the implementation of wireless service on Amtrak's Acela Express trains was instigated by the marketing department and supported by IT. He categorizes transformations in terms of "big T" and "little T" changes, distinguishing between changes that can be carried out relatively quickly and easily (little T) and those which require looking at a challenge in a completely new way from the ground up (big T).

Tough love was one of the components that helped turn Boston Scientific Corp.'s IT department from a "geek squad" into a vested business partner that could help change the company. CIO Rich Adduci spoke about the five big steps that took the medical device maker's IT organization from a crawl to a walk, to a run.

One step was to reset the mission role of IT. When Adduci showed up at Boston Scientific, he found an IT organization out of whack with the mission at the company. "We make things that matter," he said. The IT organization, however, seemed stuck on technology for technology's sake.

Next Steps

Watch a video with Smith to learn more about the IT innovation process

Read more about Rosin's innovation management approach

Read more about Deslandes' innovation balancing act and about The Balancing Act of Innovation by Philippe Silberzahn and Walter Van Dyck

Dig Deeper on Risk management and governance

Cloud Computing
Mobile Computing
Data Center
and ESG