According to CIO magazine’s 2014 State of the CIO Survey* results over two thirds of CIO’s have a hard time balancing the time and resources needed to drive both business innovation and operational excellence. Of course, for many mid-sized businesses this is not even an issue. They simply do not have spare IT resources and instead rely on business leadership to drive innovation. Yet, as the National center for the Middle Market – Blueprint for Growth** shows, higher growth mid-market companies do have a strong innovation focus. The Blueprint indicates that companies in this segment can increase growth incrementally by developing a strong company-wide growth strategy.
The challenge for IT services teams in mid-sized firms is that there is already too much to do! Maintaining existing operational effectiveness takes a significant portion of the available resources. Add to that new IT projects and upgrades, to increase organizational effectiveness and satisfy the needs of business and functional groups, and the ability to participate in business innovation efforts begins to dwindle. Throw supporting new technologies such as cloud services, mobile device management and BYOD as well as the ever present security threats into the mix and it quickly becomes clear why it’s hard to find any balance between operational excellence and innovation.
Budget and resource optimization is an ongoing discipline and not a one-off exercise but IT must also address the continuously growing demand for IT services. On top of that, it’s vital to retain existing staff by providing challenging work and good career opportunities. IT skill shortages are likely to get worse as the economy rebounds and replacing skilled and knowledgeable team members with new recruits will be not be easy or efficient.
One approach to addressing the myriad issues caused by tight budgets is to create a business growth strategy in which IT can take a leading role. With growth, budgets are more likely to expand. Growth also creates individual opportunities. Yet with constrained resources is it realistic to suppose that IT can take a leadership role on business innovation? Do IT team members know enough about the business?
Here are 5 best practice factors that mid-market CIOs need to consider before taking on innovation responsibilities.
- Innovation is a process not an event. Look at any growing start-up and you’ll find an innovation process. Successful start-ups invest in innovation by funding both customer research and engineering teams. At a minimum they have product management resources to focus on customer needs and project management and design and development resources that focus on product creation. For new business innovation strategies to work senior management must similarly resource and finance them. Boot-strapping from existing budgets is unlikely to deliver the focus needed for success. Innovation participants will come from existing functions, such as IT, but they must be able to dedicate an appropriate portion of their time without impacting their other duties.
- Success requires an innovation strategy. Occasionally new ideas are created in a single “Eurika!” moment, but that’s rare. More likely ideas come from an unbiased examination of existing approaches which may become inadequate or uncompetitive as customer needs evolve, new technologies emerge or the marketplace environment changes, such as when competitors with new approaches or business models appear. Like other company processes, innovation needs careful management to foster continuous improvement, focus, rigor and success. Process management is an area where IT can play a leading role.
- Innovation requires a team approach. In today’s complex business world it’s unlikely that a single person or function can provide all the knowledge necessary for success, certainly in any sizeable endeavor. Many innovation ideas are generated by marketing and sales or by business functions themselves. But IT has a wealth of knowledge to contribute too. Security, integration, compliance, education, support, project and vendor management, risk management, usability, information quality and management….the list goes on. By making positive contributions about how innovations can be successfully developed, introduced and managed, IT can play a significant role.
- Be innovative about innovation! According to PWC’s 2013 Innovation Survey*** the most innovative companies go well beyond thinking simply about new products and services. They look for breakthrough ideas that can set them apart from competition or create new markets or new business models with new and different dynamics. In this kind of environment IT management’s broad understanding of business processes across the organization together with its nonpartisan view of the business can be distinct advantages. Getting to know more about the competition and the customers – from the data that IT stewards – might be more valuable than seeking expertise in how the business currently functions.
- Optimize for growth. It goes without saying that IT is good at resource optimization. However, many of the actions that IT takes – standardization, protection, limitation – are made precisely because of resource constraints and can be a drag on innovation and growth potential. Start-ups favor lean development approaches where agility, flexibility and nimbleness are key. IT must both support and enable similar approaches. In addition, The IT team should review its own operations to identify where changes can free-up human resources to participate in growth and innovation strategy work. For example by:
- Investing in fewer more robust and comprehensive management tools versus a myriad of discrete point products
- Developing self-service cloud options and/or using public cloud services
- Leveraging 3rd party resources to off-load routine tasks such as upgrades.
IT budgets in mid-size enterprises will likely always be constrained but continuous innovation is necessary for long term viability and survival and IT has a key role to play. CIOs can help drive innovation strategies and can use their teams to enable success.
By helping the IT departments of mid-sized companies meet their SLA mandates, Kaseya’s advanced monitoring solution Traverse helps free in-house IT staff to better respond to business requests and provides detailed intelligence that IT can use to add strong value in conversations regarding business innovation.
Learn more about how Kaseya technology can help. Read our whitepaper, Solving the Virtualized Infrastructure and Private Cloud Monitoring Challenge.
* State of the CIO Survey 2014, CIO Magazine – slides in InfoWorld
*** Breakthrough innovation and growth, PWC Innovation Survey, 2013-2014
What strategies does IT adopt in your organization to bolster innovation?