How IT Leaders Can Help CEOs Make Innovation Walk, Not Just Talk

The business demand for innovation has never been higher. Hence, the excess of CEO pronouncements, advertising campaigns and annual reports littered with the term innovation.

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Nearly two-thirds of the respondents to a recent Accenture survey of 601 executives in the United States, United Kingdom, Germany and Canada claimed that their organizations business strategy is either totally or largely dependent on innovation. And that focused commitment comes directly from the top: Nearly 60 percent of surveyed executives said that their CEO gives a degree of support to innovation that is greater than the level of support of CEOs at their closest industry competitors.

However, the survey data also showed a large and alarming discrepancy between a CEO’s commitment to innovation and the actual creation of and execution on innovative ideas. Just 15 percent of respondents said they are very satisfied with their company’s ability to convert ideas into product and service offerings; only 13 percent said they can do it repeatedly.

“The issues [and challenges] of execution in innovation, beyond the pronouncements by the executive suite, are themes that we hear over and over,” says Dan Chow, a senior executive in Accenture’s strategy practice. “Everybody besides the CEO seems to be very unsatisfied about what might be in place.”

In turn, a majority (57 percent) of respondents said that their organization’s speed of innovation was slower than that of industry peers, and 55 percent said that their frequency of innovation trailed their industry peers, according to the results.

Many of Accenture’s clients, Chow says, are struggling to balance the fiscal and resource demands of maintaining core operations and implementing innovative processes. “So how do they ambidextrously work not only on the incremental extensions [of their core business], which are important to fuel the top line and bottom line,” he says, “but how do they build a mechanism to explore into new territories.”

One potential reason for the disparity is that in many companies there’s no clear innovation champion at the top. So while nearly two-thirds of the respondents said innovation was a top business strategy, only 21 percent said their companies have a chief innovation executive. And even fewer—just 11 percent—said there is a C-suite executive in charge of the process.

Roughly half of the respondents said that multiple executives are responsible for innovation in their companies, which can, in some cases, create packets of bureaucracy. And bureaucracy and innovation are two words that should never go hand in hand.

“People in organizations crave those tools and techniques and, to some extent, freedom to actually execute,” Chow says. “The things that can help companies perform at a different level have to deal with process and discipline—not bureaucracy—but tools that enable people to actually generate new insights into the market, new ideas, and actually execute them without the frustrations that you see today.”

What IT Can Do

CIOs and IT managers are well aware of the innovation imperative. But they may not be aware of the role that they can play in enabling employees to execute on the innovation visions of their CEOs. “[CIOs] have a big role to play,” Chow says.

First, it’s important that IT managers understand the paradoxical relationship between process and innovation, Chow points out. “The more discipline you actually have in this [innovation] process, without being bureaucratic,” he says, “the more innovative you can actually be, and the more you can tap into bigger swaths of the organization, rather than just letting the R&D organization just have all the fun.”

According to Chow, there are three key elements of a sound innovation system. First is what he calls foundation. This is a measure of an organization’s ability, through its combined skills, capabilities and processes, to drive new market insights. “You’re not going to get much further than your competitors unless you have a different view of the marketplace, customers and trends,” Chow says.

The second element is conversion: an organization’s ability to take new ideas and develop them into launchable, profitable products. “It’s no good to have a set of good ideas unless you can actually convert them and deliver them to the marketplace,” Chow says. “And still, we see time and time again, companies continue to be frustrated [by this] when they’re exploring into new [product and service] territories.”

The third item is consistency: an organization’s ability to repeatedly execute on their innovative ideas, new product and service creations coming from not just the R&D department but all corners of the company. “We know that things like incentives, leadership, tools and techniques that are available throughout the whole organization and are part of an idea management process give people a foundation to not only learn how to innovate but execute,” Chow says.

Underneath those three pieces, IT infrastructure and networks of information can offer “insights into where customers’ heads are at and what their needs are,” Chow says. “There are lots of technologies out there that enable companies to really understand the pulse of what’s going on in the marketplace.”

These tools and techniques include idea-generation and workflow applications that can provide “portfolio-level views of where the company’s ideas are and what kind of benefit they are going to be extracting from them,” Chow notes. “And all of that requires infrastructure, process and technology to become disciplined.”

Besides providing the expertise on the back- and front-end enabling technologies, Chow also sees an opportunity for CIOs and IT executives to partner with other executives and demonstrate leadership. “It’s the perfect opportunity for partnership,” he says.

Unlike many other C-suite execs, the CIO has a unique, end-to-end perspective on “how the system works, how the corporation works and how to deliver, from front to back, through the innovation process,” Chow says. “It’s a great opportunity for CIOs to step up and work with CMOs, CTOs and heads of R&D and manufacturing to make this work from end to end.”