Continuing on my business-IT integration theme, I want to share some excerpts from a BusinessWeek article, entitled IT’s Star Turn. I found the article via Ben Worthen’s BizTech blog. The article, written by Jeneanne Rae of Peer Insight talks about the importance, and yet dearth, of IT participation in corporate innovation. Following the excerpts, I have a few questions. The emphasis is mine.
First, the opportunity: the shift to a services economy, the innovation edge, and the tie to information technology:
“The fundamental shift of the U.S. economy from one based on industry to one based on services has been covered in this column and elsewhere. While some companies—and indeed industries—still resist the trend, the innovators have recognized that the production of value lies in the creation of services, and have adapted accordingly.
Even product-based companies have shifted their focus from the production of physical goods to the delivery of device-enabled services products. But here’s the related innovation trend that no one is talking about: Increasingly, those services are being driven by scalable technologies. The information technology departments once seen as back-room cost centers are becoming key players in the execution of innovation, and hence, the creation of value in the new marketplace.”
Next, the absence of information technology personnel in the innovation discussion:
“Where is IT in the innovation conversation? With IT being so essential to the innovation equation, and with so much riding on the IT department’s ability to build and maintain the systems that will drive customer delight, you’d think there would be more talk about the role of IT in innovation strategy.
But let me ask, how engaged are chief information officers in innovation initiatives? Are members of your IT department full-time members of innovation project teams? Or do they exhibit a “call me when you need me” approach? Or worse still, a “Put your request in the queue, I’ll get to it when I can” attitude?
Based on my research, the majority of IT departments sit on the sidelines of innovation discussions when they should be central players. Systems consultants as well as corporate representatives say that, typically, IT departments are tactical rather than strategic, reactive rather that proactive, and isolated rather than integrated. Few in the IT ranks speak “business model,” which is unfortunate given that so much customer and shareholder value is dependent on IT solutions to facilitate critical network connections.
…many corporate innovation executives I know no longer consult their IT departments. Despite the risk of exposing new business strategies to potentially untrustworthy third parties during the “fuzzy front end” stage, they simply go outside. “You get tired of hearing, ‘no, we can’t do that’ all the time,” said one practitioner at a Peer Insight forum recently.”
Lastly, a prescription, or continuation of the Business-IT Integration theme:
“In order to support the robust innovation pipelines that many corporations aim to build, we have to rethink how we integrate IT into our organizations, particularly as it relates to driving innovation. Start with the IT leadership team, where more executive bench strength will be needed. IT managers should be well-versed on managing cross-functional initiatives, and should understand the company’s business end-to-end. These managers will need to guide innovation teams in regular technology road mapping and system architecting sessions. Interaction design and rapid prototyping of customer touchpoints will be the standard, not the exception. Iteration and user testing of new software concepts will be a core capability. Likewise, IT must be engaged and mentored by business managers as the opportunities to learn and collaborate go both ways.”
1. How does IT participate in Innovation at your company? Are IT personnel at the Innovation table? If so, which roles? CIO, CTO, Chief Architect, Business Relationship Manager, other?
2. Are technology capabilities/advancements input to Business Innovation Ideation? (how’s that for a management buzzword?)
3. How integrated are business and IT at your company?
(a) IT is an order taker
(b) IT aligns with business (IT takes and supports business lead)
(c) IT and Business are integrated: collaborate on Innovation, Strategy, Architecture and/or Portfolio Planning?
[Note: This post originally appeared on my Business Driven Architect blog on August 7, 2007, brought over to elemental links on June 7, 2008]