The Role of IT in Innovation: Friend or Foe?

The Role of IT in Innovation: Friend or Foe?

A lack of IT agility can stop growth dead in its tracks, but so can a business that fails to see IT as a strategic partner

IT Doesn't Always Work This Well

The K&L anecdote represents IT at its best, but it's not necessarily the rule. Forrester analyst Laurie Orlov published a paper in November 2005 called "Make IT Matter for Business Innovation". In it, she commented that "many IT organizations have lost their way in the past few years", and that corporate leaders tend to see IT as inflexible and unable to keep up with business change. For example, IT relies on change-resistant software that is too costly to modify or too reliant on too many ERP systems to stay in sync with changing business conditions. She added a pointed critique, quoting a consultant: "We help sales and marketing bring customer service innovations to market — but having to go through the IT resource inhibits our efforts to get it done."

That inflexibility is, in many cases, an issue of IT complexity, says Stephen Shapiro, business adviser and author of 24/7 Innovation. "I think of creativity and innovation as connecting the dots," he says. "How do you connect the dots when you have 850 ERP systems?" (One of his consulting clients, which he declined to name, had that many ERP systems.) The problem, Shapiro adds, is that business and IT tend to operate in their own silos.

IT complexity and its debilitating effects on business were also noted by Rudy Puryear, Bain & Company's head of IT for the Americas region, in an interview with CIO.

"Business change continues to accelerate — what I oftentimes call the MTBS, or mean time between surprises, continues to get shorter," says Puryear. "In an environment where that happens, the mean time between surprise and response also has to get shorter." But all too often, he points out, response time is anything but fast. "The cycle times in IT are increasingly much slower and out of sync with the cycle times required by the business to stay competitive."

This year, the Boston Consulting Group's (BCG) study on innovation found that although the majority of companies are spending more on innovation, fewer than half of the respondents reported being happy with the return on their innovation spend. To blame? Overly lengthy development times was ranked as the number-two obstacle with 36 percent (just after risk-averse culture at 38 percent). And 54 percent of those respondents — 2468 senior executives from around the world — said their companies moved from idea generation to revenue generation too slowly.

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