10 reasons IT leaders fail at innovation

Innovation is an important driver of growth, and many technology leaders aspire to build capabilities that can deliver sustained innovation. But they have a steep hill to climb: A quarter of CIOs who participated in Deloitte’s most recent global CIO survey say their innovation capabilities are nonexistent. Only 11 percent assessed their current innovation capabilities as excellent or leading.

Here are 10 reasons innovation initiatives are lagging and what IT leaders can do about it.

1. Defensive posture In the global CIO survey, “resistance to change” was cited as the top reason technology change efforts fail. Investments in unproven or disruptive technologies are often viewed as risky, and business leaders are typically more comfortable with “safe” investments such as enhancements to existing technologies. The workaround? Collaborate with business leaders on balancing technology investments across both defensive and offensive pursuits. Strive to create a culture that encourages and supports creative thinking and rewards effort more than outcome, and clearly articulate the organization’s risk appetite so staff can take calculated risks.

2. Lack of sponsorship and accountability Without visible sponsorship from one or more senior leaders, innovation efforts are bound to flounder. High-level support helps prevent innovation efforts from becoming bogged down by organizational politics, lack of resources, and stunted budgets. Moreover, executive sponsors can help clearly articulate expectations and hold people accountable for delivering business outcomes.

3. Lack of capacity to deliver Too often, technology leaders ask their best talent to split time between managing business operations and participating in innovation initiatives. As a result, the most effective innovation resources lack capacity or get distracted by their “day jobs.” Effective executive sponsorship can allow IT leaders to allocate their best resources, even on a rotational basis, to be focused on driving business outcomes. Dedicated budget and resources for innovation can reduce the risk for individual business areas and provide cohesive solutions.

4. Singular focus on technology Even when they genuinely believe a technology will change the business, technology leaders often make technology decisions without a deep understanding of business issues. As a result, innovation efforts can be viewed as an experimental science lab that rarely returns substantive value. To overcome this obstacle, technology teams should co-create business solutions; that is, they should bring business functions into the process of experimentation and iteration.

5. Disjointed ownership and lack of constraints Continuity of effort and steady focus are hallmarks of effective innovation initiatives. Leaders should allow the person or team that generated an idea to remain actively involved throughout the process, creating continuity and providing valuable historical context. More important, successful innovation initiatives provide clear operational guard-rails. For example, a pharmaceutical company approved any project that could be prototyped in three months, make an impact on more than 10,000 customers, and cost less than $50,000.

6. Not-invented-here syndrome Organizations that don’t look for innovation beyond their own walls limit their ability to operate and win in the marketplace. IT leaders have traditionally relied on vendors to augment work but are increasingly leveraging the whole ecosystem for delivering innovation. Startups and innovation hubs can provide access to leading thinkers and inventors; universities and research centers can provide a peek at the future; and online marketplaces and platforms enable businesses to engage with suppliers, vendors, partners, and even customers to co-create products and services.

7. Out-of-sync efforts Innovation often requires the whole organization to work in concert. For example, the strategy organization defines the playing field, R&D provides the vehicles for innovation to flourish, and technology provides the tools to support innovative projects. If the functional areas are out of sync, business leaders may create skunkworks innovation projects, which typically operate in silos and can create potential integration, security, and scalability issues. A coordinated governing body across business and functional areas can alleviate these problems.

8. Bias toward process over speed New technologies and techniques have rendered traditional sequential innovation processes obsolete. For example, a traditional innovation process would view prototyping and scaling as distinct, sequential activities. Today, cloud platforms offer instantly flexible and scalable infrastructure, allowing teams to create prototypes with built-in scalability. Teams that don’t consider scaling until after a successful prototype is created could be wasting valuable time and adding risk to the process.

9. Expectation of different results from the same talent It’s not enough to allocate funding and resources for innovation. To change behaviors and demonstrate what “good” looks like, technology leaders should infuse their organizations with talent driven to think creatively and take intelligent risks. Savvy IT leaders don’t limit this infusion to new talent but look across their ecosystem to determine how to infuse this mindset into existing IT talent and culture — whether through hiring, partnering, or bringing in contractors or freelancers.

10. Failure to measure The metrics used to measure the success of innovation initiatives are different from those used to measure the success of traditional business initiatives and should be clearly constructed so they don’t thwart innovation. One company used a “metric of one” — a single significant success that made an impact on one major business unit in one year. Whether it’s 1 million customers or $100 million in revenue, having a single major metric can help you tell your organization’s innovation story more effectively.

Technology is moving so rapidly that the only way for organizations to keep up is to continually innovate. CIOs should lead their organizations in building a technology-enabled business innovation capability — or other leaders may step in to fill the void.