IT vendors and business innovation
How can you tell who gets it?

First published: September 2006

by Dale Vile

Anyone routinely on the end of vendor marketing messages may have noticed a new word creeping into the vocabulary – “innovation”. It’s a motivating word, so it is not surprising that the marketeers have latched onto it.

But what do they actually mean by it?

Well, you will get a range of different answers depending on who you ask. Some refer to innovation in the context of their own product development, using the word when talking up the fruits of their R&D labour and investment. Others talk about enabling their customers to apply innovative techniques when designing and building IT systems, typically as part of the positioning of tools and infrastructure components. The most interesting use of the “i” word, however, is when it is applied in the context of “business innovation”.

Mmm, this is starting to sound like another one of those abstract visionary adjectives we hear continuously from vendors, consultants and analysts like “flexible”, “adaptive”, “agile”, “on-demand”, etc. We haven’t quite got to the phrase “the innovative enterprise” yet, but we’re obviously heading in that direction.

There is, though, a concept that is starting to emerge from behind the all of this innovation related talk that could represent an interesting change in the way the IT industry will be encouraging us to view the role of IT systems in the future.

Over the last few years, the majority of strategic vendor pitches have all started with a variation on the same cliché, pointing out that as a result of the internet, globalisation and so on, the world is becoming faster, tougher and more threatening. We’ve all heard the examples - if a competitor makes a move to steal marketshare or a new entrant comes into the market with a disruptive approach, the time it takes to adapt to the new business environment can be the difference between life and death. It is therefore necessary (the cliché goes on) to put systems and processes in place that are flexible, adaptive, (…) which allow the business to react quickly to external pressures and events (… then on to the product pitch).

Predictable though this is, the mantra is founded on a certain amount of real world reality. An organisation of course needs the ability to defend itself when it is unexpectedly threatened, and this requires a degree of operational agility, which in turn requires flexible IT systems.

There is an interesting question to ponder in relation to this, however. Rather than joining the ranks of all those out there busy defending themselves from all of threats in these new and dangerous market conditions, wouldn’t you rather be one of the companies doing the threatening?

The truth is that smarter companies already think and act in this way quite naturally. These are the organisations run by business leaders who are less concerned with adapting to the new game, and more intent on creating their own rules and making others play by them – not just based on new products, but new services, delivery mechanisms, business models, etc. This is the domain of business innovation.

So, what must organisations do that aspire to maximising their performance in this area?

We need to be careful not to try to teach grandmothers to suck eggs here. As intimated earlier, business innovation is nothing new and we would hesitate to give advice to those who have built businesses and careers around continuously disrupting, shaping and re-shaping markets. But if your company doesn’t necessarily have that kind of culture, it is worth taking a step back and considering how advancements in the area of information technology can help you move more in that direction, enabling the company to take more control over its own destiny.

In order to tune into the potential, however, we need to understand that the pivot point for business innovation is people. Innovative products, services, business processes and business models, often enabled by innovative technology, are what we see when we look in from the outside, but all of these are the end result of people actually doing the innovating.

But which people are we talking about specifically here? Well, as many in the workforce as possible – not just the R&D department, strategic planning groups, and other traditional custodians of new ideas, but people out there doing their everyday jobs.

This is where Microsoft is coming from with its “people ready software” message and why IBM currently putting so much emphasis on collaboration and breaking down boundaries within organisations to allow people to work together more seamlessly and effectively across the business. The messages have changed subtly from using innovative technology gain competitive edge to using technology as a way of enabling people to create that edge through business innovation. The enabling technologies here range from the latest generation of office suites, through communication and collaboration solutions, to portals and SOA used in combination to empower users in their leverage of corporate information resources.

So do these new lines of messaging resonate with mainstream businesses or is it all just marketing fluff?

Actually, it would appear that the vendors have struck a chord with their customers on this one. In a recent Freeform Dynamics study looking at various aspects of SOA, for example, business innovation came through strongly as a motive for investing in the latest ideas, tools and infrastructure in this area. And this kind of feedback tallies with earlier studies suggesting that one of the most frequently cited wishes of business management in relation to IT is the delivery of more novel capability to support the business as it changes and evolves.

But acid test of whether a vendor really understands the business innovation related requirement looking forward is whether they put people at the centre of their arguments and positioning. If all they are doing is using the phrase to highlight their own innovations for differentiation purposes, they have probably missed the point.

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