Saturday, January 23, 2016

Running IT as an Innovation Engine in Digital Organizations

IT is the key component in catalyzing digital innovation and building up differentiated business capabilities nowadays.

Organizations large or small are at the digital journey, and corporate IT is also shifting from a support center to an innovation engine, because more often information is the lifeblood, and technology is the disruptor to push the business world into the digital paradigm. Hence, for any forward-thinking organizations, IT mantra is shifting from “doing more with less,” to “doing more with innovation. But more specifically, how to run IT as an innovation engine to accelerate digital shift?

IT as the catalyst for business innovation: The definition of innovation is simple - to gain benefit by doing something different. Innovation is to have a new perspective on things. Innovation follows basic rules, which are adapted depending on the company's situation and ambition.  Innovation can be categorized as empowered innovation (creative disruption), sustainable innovation (better version of product/service) or efficiency innovation (process improvement). IT can drive all sort of innovations, proactively pushing ideas on how to leverage technology to drive revenue growth, increase business productivity, flexibility, and agility. Often the IT department is so busy in mundane day to day activities, they lose the sense of creativity over the period of time. Hence, CIOs have to learn the right and real things about organizations, not just via IT lenses, but via business lenses. Because then, he/she can practice that knowledge in the field to start innovating at the organizational level.

Process Innovation: Nowadays, technology is often the innovation disruptor, IT leaders are often at the right position to oversee business processes and set the right policy for their business’s technology and information usage, identify the critical business issues by working closely with a business partner from a long-term perspective, and leverage technology to manage innovation across the enterprise boundary. The challenge is to come up with a systematic approach that does not add more burden to an organization that is already dealing with productivity fatigue. Therefore, IT plays a critical role in business process innovation and strike the right balance between innovation and standardization. Standardization is inside-the-box (ITB), and Innovation is outside-the-box (OTB). Hence, organizations indeed need both, and, in fact, cannot realistically exist without a healthy balance of both. That balance, ought to actually be strongly in favor of standardization at the vast majority of the time!

IT staff as innovation champions to revitalize the business culture: Due to the changing nature of technology, IT staff also needs to be in a continuous learning mood to update knowledge and skills, challenge the old way to do things. Being able to become innovative or close is being able to think, and create new things based on its own needs, true knowledge is the optimal solution. Innovation is all about doing things better, differentiate yourself from your competitions, run, grow and transform the business. So educate the IT team on the business and encourage them to engage with business counterparts in a value-oriented manner. Building an environment where the only thing you get fired for is not asking hard questions. Often the most disruptive person is the one you want to harness. IT does play a significant role in not only innovating the hard element of the business such as process, but also the soft element of the organization such as culture.  

IT is the key component in catalyzing digital innovation and building up differentiated business capabilities nowadays. When IT Executives move beyond commodity management and begin to show higher level strategic value and dedicate more resources on innovation, then IT is lifting up its maturity from reactively responds to the business’s order to proactively enable strategy execution, and from a support center to an innovation engine.  


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