For years, innovation has been a sensitive and largely misunderstood subject in the outsourcing industry. Buy-side enterprises insist on it, stipulate it in their contracts, and complain bitterly when they don\u2019t get any. Meanwhile, service providers meet their quota of ideas each quarter, hiring armies of talented PhDs to re-invent the pharmaceutical supply chain, for example, only to be summarily dismissed by the client as \u201ctoo risky\u201d or \u201cnot at all what we meant when we said innovation.\u201d It\u2019s been a discouraging cycle for both parties, to say the least.\n\n\nThe trouble herein lies in what a former colleague and influential IT thinker\u00a0Peter Weil\u00a0calls the \u201cexpression barrier.\u201d It is the inability of the demand and supply side of IT services to understand each other. And, in this case in particular, I believe blame most often falls on the client.\n\n\nAs my seventh grade English teacher used to say, the truth is in the grammar. You can\u2019t demand something new and untested\u2014the definition of innovation\u2014and then ask \u201cwhere have you done this before?\u201d every time the service provider offers an idea. To parse the terms, what most outsourcing buyers have really been looking for is continuous improvement or the application of best practices. And, while these are worthy goals unto themselves, they are not true innovation.\n\n\nThis tired dynamic is about to change.\n\n\nWith the emergence of digital, cloud, social and mobile technologies, clients can no longer afford to turn away their service providers\u2019 ideas. In fact, they would be foolish not to harness providers\u2019 investments in innovation that, in all likelihood, dwarf their own. Let\u2019s face it, succeeding with emerging technologies is an essential survival strategy for providers. Outsourcing buyers that fail to take advantage of such investments (which are being made on their behalf) are leaving money on the table and jeopardizing their near-term competitiveness. If nothing else, they need to be crystal clear in how they articulate the level of risk they can tolerate and what they really want when they say innovation, otherwise they lead their providers on a wild goose chase.\n\n\nService providers, in the meantime, are caught between a rock and a hard place. They must trudge ahead with their quarterly innovation offerings or suffer the slings and arrows of the client. Insisting on innovations that their clients deem too risky is a frustrating exercise with the potential to damage the relationship\u2014but insist they must. If they don\u2019t, the day will come when the client blames them for having fallen behind. Despite the fact that they will always get the blame for lack of progress\u2014even when their client may the biggest barrier\u2014smart providers know they will not get ousted for proposing too many new ideas. They may, however, have a hard time holding onto their existing business if they don\u2019t keep their clients\u2014at the very least\u2014up to snuff with new technologies.\n\n\nMake no mistake: unlike most other technological revolutions in our lifetime, today\u2019s advances are more about competitive advantage than operational efficiency or cost reduction. Seizing the moment requires companies and their outsourcing providers to engage in open dialogue, experiment frequently, fail fast, and collaborate to bring\u00a0differentiating\u00a0solutions to market more quickly than all the others.\n\n\nI\u2019ve been waiting for this moment my entire career, and I can\u2019t wait to watch it unfold.