2007 CIO 100 Winners: How IT Can Harness the Power of Innovation

Transformation.

IT has always possessed that power. And companies have sought to harness technology for competitive advantage ever since CBS used a Univac to beat ABC and NBC by predicting Dwight D. Eisenhower’s victory in the 1952 presidential election.

However, organizations that want to leverage IT to beat the competition, to shake up their operations and even their industries, need more than technology, more than great ideas. They need to have IT departments that understand what makes their companies tick and IT leaders who know how to translate visions into actions.

CIO 100: IT Innovation

Quiz: Are You Innovative?

100 Innovative Projects

3 Keys to Innovation Success

Make Money, Win Customers

This year’s CIO 100 Awards honorees understand. They’ve embraced IT innovation as a tool for transformation, their winning projects motivated by critical business needs and the conviction, backed by solid analysis, that technology-enabled change can create new value. The CIOs at these companies define themselves not as technology suppliers but as facilitators of corporate growth. (Find out how we chose them.)

In fact, as our honorees report in an exclusive survey, their innovations most often originate with business leaders or cross-functional teams established to tackle a specific problem or opportunity. Seventy-eight percent say IT shares leadership of innovative projects with business sponsors. (To compare yourself with our CIO 100 honorees, take our self-assessment quiz.

“The first step was making sure that this wasn’t viewed as an IT project,” Flowserve CIO Linda Jojo tells writer Cindy Waxer about her award-winning effort to consolidate 68 ERP systems and multiple data centers in Using IT to Transform the Business: Three Keys to Success. “We’ve made sure that this project is something we talk about in terms of its business impact.”

How to Make a Big Bang

These innovative CIOs don’t shrink from ambitious projects. And, as Waxer writes, forward-thinking IT leaders see past the infrastructure they’re charged with creating and maintaining to the end user’s experience. Like Jojo, they’re skilled at communicating the value of technology in business terms, whether the project is the central processing of check deposits captained by CTO Ron DePoalo for Merrill Lynch’s Global Private Client Technology Group or the global computing grid for drug research championed by Karan Sorensen, CIO of Johnson & Johnson Pharmaceutical Research and Development.

But it’s not enough to spell out the benefits of a big-bang project to the bottom (or top) line. Big projects take time, often expand in scope and usually affect employees throughout an organization. According to our survey, opposition to innovative initiatives comes most often from the business staff. CIO 100 honorees succeeded by generating a sense of urgency and excitement among senior company leaders. These CIOs also recruited top thinkers from within IT and across the company to contribute ideas, hone project parameters and rally the rank and file.

However, before IT can tackle any innovation, it needs credibility. In How to Transform Your IT Department from Order Taker to Innovator, Senior Editor Stephanie Overby reports on four CIO 100 honorees who had to change how they worked with their business peers before they could transform their companies.

For instance, when Vince Kellen became CIO at DePaul University, he found an IT organization with “a passion for pushing the future.” But it wasn’t responding effectively to business demands, nor did it have a strategy to guide it. So Kellen threw out the org chart and repositioned his staff to deploy a service-oriented architecture, for which DePaul is honored this year. At law firm Foley & Lardner, CIO Doug Caddell worked around the inbred IT skepticism of the firm’s lawyers by building a system on spec that he believed would increase revenue. The lawyers were sufficiently impressed that when they sat down to develop new ideas for cross-selling to clients, they invited IT to the very first brainstorming meeting. The resulting system, which enables the firm’s lawyers to share clients, earned Foley & Lardner its CIO 100 honor.

Where Innovative Ideas Come From

CIO 100 honorees identified these sources for their innovative projects:

1. Business unit or function leaders

2. Ad hoc cross-functional teams

3. CIO or IT staff

4. Business staff

5. CEO

SOURCE: Survey of CIO 100 honorees.

A World Full of Ideas

Innovative CIOs pay attention to customers, the group that makes the ultimate decision on what’s valuable and what’s not. In IT Innovations That Generate Revenue and Get You More Customers, Associate Staff Writer Katherine Walsh details how three CIO 100 honorees devised innovative ways to help customers help themselves.

Best Buy built a business intelligence system that helps employees aggregate products that customers usually purchase together-facilitating sales by allowing them to find what they want when and where they want it. Hilton Hotels built a system that permits corporate meeting planners to book events online-everything from rooms to meals to audiovisual resources-garnering millions in new revenue. And Washington Mutual revamped its processes for opening and authenticating checking accounts online to relieve customers of the time-consuming chore of signing their names over and over again on paper. The result: an explosion of new business.

Top Technologies for Innovation

What CIO 100 honorees plan to deploy next year:

1. Virtualized servers

2. Business intelligence/Data mining

3. Enterprise portals

4. Wireless

5. Web services

SOURCE: Survey of CIO 100 honorees.

Finally, many of this year’s honorees exemplify a growing trend toward collaboration across corporate boundaries. Although honorees report that having smart, creative people on staff is an essential ingredient in any innovative business culture, they’re smart enough to know that good ideas reside outside the enterprise too. The honorees ranked strong partnerships with vendors or outsourcers third among the top techniques they use to develop and execute innovative initiatives (behind cross-functional innovation teams and close relationships with customers).

A few of this year’s honorees went so far as to partner with other companies-even potential competitors-in their industries. Read Collaborative Innovation: Five Steps to Successful Technology Partnerships, by Associate Staff Writer C.G. Lynch and find out how Loyola Marymount University, in L.A., hatched a disaster recovery plan with Lewiston, Maine-based Bowdoin College, as well as how the New York Mercantile Exchange futures market arranged a deal with a potential rival (and fellow CIO 100 honoree) Chicago Mercantile Exchange (CME) to share CME’s electronic trading platform. Also find details about all 100 award-winning projects, along with 15 tips to help you execute your own transformational projects.

Now, go ahead and shake things up.

Executive Editor Elana Varon coordinated this year’s CIO 100 Awards competition