innovation - ibm · "often, in common parlance, the words creativity and innovation used...
TRANSCRIPT
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AgendaHello
Innovation
What is it?
Different types of innovation
Innovation is all about the outcome
What does the business want?
Testing a vendor’s Innovation Quotient
How can you challenge vendor claims?
Establishing Innovation as a deliverable.,..
Can you measure innovation?
Three things...
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What is innovation?
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Some definitionsLuecke and Katz (2003):
"Innovation . . . is generally understood as the introduction of a new thing or method . . . Innovation is the embodiment, combination, or synthesis of knowledge in original, relevant, valued new products, processes, or services. (p. 2)"
Davila et al (2006) comment:
"Often, in common parlance, the words creativity and innovation used interchangeably. They shouldn't be, because while creativity implies coming up with ideas, it's the "bringing ideas to life" . . . that makes innovation the distinct undertaking it is."
Ovum (2006):
“Innovation is applied creativity; that brings about tangible improvements in service, process or product”
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It’s a marketeer’s dream“Innovation” rhymes with lots of things
Situation, Realisation, optimisation
The word can be re-cast in “innovative” ways
SynovationEDS has taken this one already
Innogration
Collabovation
Innovation is a marvelously woolly concept
It can be interpreted in many different ways
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Incremental vs Radical InnovationIncremental
Evolutionary change
Low risk
Incremental reward
Radical
Revolutionary change
High risk
Potential for high reward
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Is Innovation a good thing?
Consider the following...
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At the doctor’s you’re told...
… I would like to try out an innovative new procedure with you...
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Which house would you buy...
Both very similar in terms of location, size, layout etc
Except:
House “A” has boring “old fashioned foundations”
House “B” has foundations that are “exciting” and innovative
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You accountant tells you
… we’re going to calculate your tax using an innovative new
approach...
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Your mortgage agreement states
… we will apply an innovativenew formula to calculate
the interest you pay...
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Different approaches for different circumstances
Enterprise Infrastructure(SOA)
Utility Assembly Delivery
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It’s all about the Outcome
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If there’s no business outcome, it’s not innovationAll the business wants is -
Price competitiveness
Supply chain efficiency
Removal of cost from the business
Value competitiveness
Time to market
‘Surprise and delight’
A market of ‘one’
Reach
To new customers
To new channels
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Testing a vendor’s IQ
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Innovation Quotient : Basic PrinciplesIf there isn’t a client in the room, it isn’t innovation
Research is ok, but unless there’s a client that benefits then it’s just research
You can’t claim to be a global innovator if all your innovation happens in one country
There’s not much point in announcing the opening of a global innovation center that’s based in Texas
No vendor is big enough to deliver consistent innovation without involving partners
The most effective vendors will engage partners in the innovation process
If there isn’t an “outcome” it isn’t innovation
Your shareholders don’t want “innovation” they want “profits”
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Be Cynical: Ask for evidenceFrom your geography
Some vendors will have lots of US examples, but will be able to provide very little evidence that shows that their innovation capabilities “travel”
From your sector
You need to know that the vendor understands your business, and the drivers that affect it
Don’t regard a case study based on a small gold mining company in Saskatchewan as
evidence that the vendor will deliver innovation to you
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Can the vendor strike a balance between incremental and radical innovation
The smartest vendors will know when to aim for incremental and when to aim for radical innovation
Radical innovation isn’t always going to be the right approach
Smart vendors will be able to do both
Essential because you will want to do both
Smart vendors wont try to sell you “Innovation” but the outcomesthat it brings
We’re very pleased to see IBM using the phrase “Innovation that Matters”
Smart vendors will consider innovation in every aspect of what they do
Innovation in terms of technology, delivery, relationship
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Establishing Innovation as a deliverable
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Delivering innovation
Clear goals
Your shareholders don’t want “Innovation” they want results
Cost reduction, process improvement, agility, reach
And agree a way to measure success
Distinguish between different components of your IT portfolio
With some you want steady, reliable, incremental innovation
With others you may want to take a more radical approach
Don’t just innovate in terms of technology
Innovate in terms of the relationship
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Delivering innovation
Think about intellectual property / trade secrets
What contribution have YOU made to the innovation?
How does your agreement apportion the ownership of intellectual property that is generated?
What resources will the vendor bring to bear to deliver innovation
Experts, lab access, engineers, development teams?
What resources will the vendor expect you to bring to bear?
Key managers, business experts, architects
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Three things
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Three key thingsInnovation is the differentiator du Jour
Remember it is all about your businessCarefully check each vendor’s IQMake sure they can repeat their past successes with your business
Innovation isn’t innovation without a clear (measurable) outcome
Be clear about the outcome that you wantBe clear about the type of innovation you’re after
If “Innovation” is part of the value, it should form part of thecontract
Make sure that innovation doesn’t just form part of the conversation, but part of the contract as wellBe clear about your responsibilitiesMake sure the agreement covers intellectual property that is created jointly
Level 3Questions?
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Thank-youGary BarnettResearch Director, Ovum