Transform Your I&O Organization Into An Innovation Machine

CIO — Consider the following scenario: A prospective customer walks into your store to buy an air conditioner. He evaluates several models and then buys one -- but not from you. It turns out your competitor located two miles away is offering the same model at a 20 percent discount. How did he know this? He scanned the product's bar code using the RedLaser app on his iPhone, which displayed several local retailers with lower prices than yours. If he had been willing to wait three days for shipping, he could have purchased the exact same model while standing in your store from an online retailer at a 30% discount.

This example is one of many instances where technology-led innovation is fueling disruption across every industry. Since the early 1900s, businesses relied on competitive barriers such as manufacturing strength, distribution power, and information mastery. But this is all changing in what Forrester calls "the age of the customer," where empowered consumers have at their fingertips the ability to check a price, read a product review, or ask for advice from a friend, right from the screen of their smartphone.

In the age of the customer, it's more important than ever for enterprises to innovate to differentiate. The current economic turmoil provides the best possible justification for innovation. Why? In the past three years, we've seen the demise of established companies unable to adapt, which were quickly replaced by more innovative and agile enterprises.

Within IT, however, the I&O organization often takes a backseat role, perceived as the supporter of innovation but not the innovator. The reality is that many businesses are ill-equipped to foster innovation in dynamic environments like I&O, where change, not stability, is the norm. I&O leaders must try that much harder to create a culture of innovation where it may not exist or where broader organizational constructs get in the way. In order to define and solidify I&O's role in innovation, recent research from Forrester argues that that I&O executives must recognize that:

1. Infrastructure and operational skills are an essential asset for any innovation project -- but I&O can also be the catalyst to ignite the creative spark.

I&O has both a deep knowledge of the IT infrastructure and processes supporting business services, and a unique view of the users. Infrastructure is the contact point between the user and IT services, giving I&O professionals visibility into how the users consume IT services. Innovation directed at simplifying and improving business services at the end user level and derived by observing usage patterns would use the skills and knowledge already available within I&O.

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