Why Innovation is the CIO’s Job

When companies look to innovate, more frequently than not it’s the CIO who gets the call. Why? Because IT is the only function that touches every aspect of an organization—from the back office to the front-end customer-facing systems and technologies. The trend among organizations to place the responsibility for innovation on IT’s shoulders is borne out in CIO’s 2007 “State of the CIO” research report (in this issue).

For 2007, respondents predict that their primary impact on the business will be “enabling innovation,” which is up from number three on the IT impact list from the 2006 survey. However, only 10 percent of CIOs said that “bringing ideas for IT-enabled business innovation to the table” is a dominant part of their role. Similarly, many CIO Executive Council members are eager to crack the innovation nut and are struggling with ways to institutionalize innovation. Members report that for IT-led innovation to occur consistently, they must advance a multipronged strategy that includes gaining support and tolerance for risk at the senior leadership level, cultivating a new attitude and culture among IT staff, building supportive organizational structures, aligning and partnering with the business, and establishing formal innovation processes. In this Forum, we’ll focus on cultivating a culture for innovation. Next time, we’ll tackle those processes.

Build Teams and Let Them Play

To create and sustain a culture of innovation, there needs to be a sense among at least a subgroup of IT employees that driving innovation is one of their major responsibilities. Another hallmark of a culture that supports innovation is a designated space for experimentation, a sandbox, as it were.

Executive VP and CIO Mike Boltz of Aviva created a branded innovation team at insurance company AmerUS (acquired by Aviva Nov. 15) called the IT Garage. The 25-person group consists primarily of IT staff and includes representatives from all levels—developers to VPs—and one member from the business side. Boltz’s IT Garage focuses on how to tap powerful innovations occurring outside the company, such as open-source computing and gaming technology.

Participation is voluntary, and team members devote 5 percent of their time to these efforts. They meet in person for about two hours every month, while subgroups working on specific ideas meet on an as-needed basis. Boltz also uses Microsoft’s SharePoint portal product to support collaboration and knowledge sharing among the team. Though he won’t disclose exactly what the Garage has developed, Boltz has obtained funding and has three proof-of-concept projects under way.

At Bowdoin College, a 1,700-student liberal arts school in Brunswick, Maine, CIO Mitch Davis created an academic innovation incubator aimed at improving the integration of academic research and teaching. Davis describes the incubator as a “social interaction and work-oriented space” attached to the school’s library where IT staff, students and faculty can put their heads together and hatch innovative technology solutions (see “Inside an Incubator” below for more details). The incubator is open all year, and any student or faculty member is free to visit or use the facilities. “The only rule is that no one can talk about cost,” says Davis.

Davis actively recruits faculty and students to visit the incubator and is all ears when it comes to people’s ideas. “We treat each individual as if he or she were a business and give serious consideration to how their ideas can benefit the rest of the college,” Davis says. The goal is to show enough potential to attract grant money for the innovative ideas. One project hatched in the incubator is a Web-based Flash interface for viewing and understanding a digitized collection of rarely seen ancient Mongol scrolls. The incubator team used high-resolution scanning technology to digitally render the scrolls and then built a Web interface for viewing them. The site is one of the college’s most heavily trafficked and has garnered a great deal of attention in academia.

Not Just Order Takers

It’s arguable whether the IT-as-a-service model is compatible with innovation, but some Council CIOs feel they need to divorce their staff from the old “stimulus response” model of IT fulfillment—a.k.a. “IT as order takers.” CIOs constantly remind their people to think of the business as partners, not customers.

Hugh Scott, vice president of IS at Direct Energy, encourages this attitude by empowering his staff to “stop the line” when necessary, as assembly line workers are often empowered to do. “If they see something wrong in a business process, or if business partners don’t show up for meetings, they can escalate the issue,” he says. “And I always tell them, ’Don’t just do it because you’re being told to do it.’”

Boltz agrees that it’s important to “make sure IT staff are positioned as ’thought partners’ and not ’order takers.’” He appointed IT-business relationship managers who, rather than responding to business requests, reach out to business unit heads to discuss how IT can be used to drive their strategy.

More on how process can make or break innovation in the next Forum.