Stimulating IT innovation

In his March 15 entry on the Harvard Business Review website, innovation guru Brad Power affirms the point I made about IT's potential role as a source of fresh ideas for the business.  Power offers examples from financial industry leaders, like Nationwide Insurance and ING, demonstrating IT plays more than just a system delivery support function. 

We're also seeing waves of technology-driven disruption in markets ranging from self-service vending and hospitality to transportation and healthcare.

In fact, in market after market, we are seeing IT-centric innovation become the key to competitive advantage.  In its PACE model, Gartner refers to these new IT deliverables as "systems of innovation" -- which it differentiates from both "systems of record" and "systems of differentiation."  Simply put, IT is no longer about just delivering a rock-solid general ledger system and a CRM system that lets you deliver incrementally better customer service than others in your market.  It's also about incubating ideas that can make sure you're the disruptor, instead of the disruptee.

This need for IT innovation leads to an obvious question:  How can we encourage IT to be more pro-active in being originators of innovation?  After all, for years IT has understood itself as strictly a support function that only responds to the explicit and implicit demands of the business.  But, as Power rightly points out, there is just too much brain power in our IT organizations for us to ignore its potential larger impact on the business.  As IT managers, we have to take steps to make sure we use it for something other than just optimizing database performance and storage capacity planning.

Here are three simple suggestions for stimulating your IT people to think more about how they can help your business innovate:

1. Ask for it. Few IT people have any sense that the business is interested in their ideas, despite the fact that they know more about smartphone apps, social networking, and big data than anyone else at the company. A good first step is to let them know that their ideas would actually be welcome.
2. Recognize it. The first few suggestions you get from your IT staff may not be game-changers. But, it makes sense to encourage more and better thinking about business innovation by recognizing the effort people are making to contribute to the success of the business. Post suggestions to give them visibility and let others add their own comments and criticisms.
3. Reward it. Innovation can have a powerful positive impact on company performance and it makes sense to offer powerful positive incentives for coming up with such innovation. Yes, this can include cash.

Of course, IT people should also be encouraged to be excellent at their primary responsibilities as well.  Companies don't go out of business because a sales reporting system is a little sluggish at the end of the month or a few days of data has to be manually re-constructed.  These days, they are dropping like flies because of a failure to innovate.  IT can play a central role in that innovation.

Are you doing anything to stimulate creative thinking about the business in your IT organization?  Has anyone come up with any good ideas that you've put into action?  Help inspire your peers by sharing them here.

Chris O'Malley is CEO of Nimsoft.  He has devoted 25 years to innovation in the IT industry -- most recently growing businesses in cloud and IT Management as a Service solutions. Contact Chris via the comments below or via Twitter at @chris_t_omalley.