13 Apr Practical innovation is about creating business value, and not more stuff
Most people tend to think of innovation as invention. That is, invention is typically the creation of a revolutionary new material object that can do something useful, says Tom Koulopoulus, a Boston-based consultant and author of the new book “The Innovation Zone.”
As Americans, we tend to be obsessed with creating stuff. And while invention has created a lot of stuff, it’s polluting the planet, Koulopoulus said last month in a presentation before IT professionals in Madison, noting the alarming number of cell phones that have made their way into landfills.
“Inventions are a dime a dozen – there are many of them,” Koulopoulus said in a presentation at the Fusion 2009 CEO-CIO Symposium.
Innovation is no longer about invention, it’s about creating value, Koulopoulus says. In the current economic environment, where businesses are driven to cut costs and create value, the concept of practical innovation has taken on greater urgency, because, as Koulopoulus notes:
“If you don’t move fast enough, you are going to be the one closing the hatch when the submarine goes down.”
Businesses are in crisis mode now because they can’t innovate quickly enough, he says.
The concept of practical innovation – one that emphasizes process over product – offers a.way out of the current downturn in that it builds on previously established concepts to create something new and useful. Because there is a business premium on agility, the proper application of technology (i.e., practical innovation) is the best way to get ahead of the curve, Koulopoulus says.
“In this economy, folks don’t want to be the irritant, so they toe the party line,” Koulopoulus said. “What I tell folks is to really take a hard look where you can express this notion of innovation when it comes to streamlining, and cost-cutting. Big ideas aren’t going to fly right now.”
Standing on the shoulders of giants
Practical innovation draws a line between old-school way of thinking about innovation, or invention, and a new-school way of thinking about innovation, Koulopoulus says.
Dr. Ajei Gopal, an Executive VP of the Products and Technology Group for CA Inc., who was a featured speaker at Fusion 2009, says that practical innovation is about taking advantage of the all the stuff that’s out there – the technological advances and business model applications – and bringing it together and applying it to customer needs.
“Think of practical innovation of standing on the shoulders of others who are out there innovating, coming up with new ideas, and bringing it together to solve customer problems,” Gopal said, citing Apple’s creation of the iPod, where it took a previously established (mp3) technology and gave it a more user-friendly interface while combing it with the iTunes business model.
In the current economic environment, businesses are struggling with making investments in innovation, even when it is innovation that will help lead them out of the wilderness, Koulopoulus says. In a time as difficult as this, how can you innovate?
CEOs and CIOs need to invest now in the transformation they need to get ahead of the curve, so that their operations will be leaner, faster and more efficient, Gopal says.
“You’ve got to do more with less – and since IT has become a key driver of growth, you bring technology into the day-to-day operation of the business,” Gopal said. “You’ve got to find a way to cut costs, use IT to further business goals, and to do so in a cost-effective manner.”
It’s all about making the transition from being a cost center, to a business driver, and using IT as a way to spur business growth, Gopal says.
“To do all of that, you need to be able to innovate and stand on the shoulders of giants,” he said. “Innovation is essential.”
Managing innovation is a complicated model in any kind of organization, Gopal says. But, it’s clear that there are some baselines that you have to work from. One is a well though-out way of normalizing all of the information or concepts so that you talk about the value of the innovation in language that everyone can understand.
For example, if you’re in the IT organization, you have to be able to talk about the value of IT in a way that a business leader can understand, and show the benefit of investing a dollar in IT and the return to the company. Gopal says. The nature of practical innovation is about being able to take what you’re doing in the context of the overarching business and show where the growth is likely to come, he adds.
Another key to practical innovation is to be customer-centric in your approach.
“Technology offers so many possibilities – there are so many different advances and inventions that are taking place right now,” Gopal said. “The key issue is the practical innovation around those inventions.
“There are smart people out there who are going to pull all of the great technology that is happening out there, and bring it together in compelling packages that will drive our industry forward.”