How to Optimize Your Organization for Innovation

Necessity may be the mother of invention, but today's cutthroat IT environment also demands creativity to achieve long-term success.

Technology and its impact on business capabilities is continually evolving, observes Ola Chowning, a partner with global technology research and advisory firm ISG. Innovation on the technology front allows organizations to both continuously improve while also practicing a bit of self-disruption; making the organization less vulnerable to external disruption while also being more prepared and practiced responding to disruption when it does occur.

Change is everywhere and it's coming faster as time goes on, says Jaynene Hapanowicz, CTO of Dell Digital at Dell Technologies. She notes that constant innovation is not just a preference, but a need for businesses that hope to thrive today. “Leaders who can embrace that ready-for-anything mentality are the ones that will drive impact,” Hapanowicz states.

Innovation drives better customer experiences and productivity, while enhancing employee satisfaction and driving economic growth, Hapanowicz says. “While many associate autonomous vehicles or the metaverse as being on the cusp of innovation, IT leaders understand that innovation can also happen in small, incremental steps and changes.”

The opposite of successful innovation is stagnation and an inability to respond to disruption. “Particularly in the technology arena, the velocity with which organizations can -- and do --innovate continues to accelerate,” Chowning says. “Lacking that ability places the business at high risk of being disrupted and/or unable to respond to external disruption.”

Building an Innovation Culture

Building a culture that encourages creativity usually requires starting small and supporting frequent iteration. “Be willing to try ideas and approaches that may not work,” suggests Christine Livingston, managing director in the emerging technology practice at business consulting firm Protiviti.

Employee-led technology advisory teams and initiative groups allow staffers to feel a sense of ownership while finding solutions to complex issues, observes Susan Tweed, vice president of enterprise technologies at analytics, artificial Intelligence and data management software and services provider SAS. “People can participate in ways that maximizes their strengths,” she says. “Some participants may be great at throwing out ideas while others love the challenge of digging deep to validate the solutions identified as the best options.”

Giving teams the freedom to experiment is essential. “When teams are offered the space to create, try, fail, and try again, they are given the opportunity to learn from those experiences and bring that insight into their next projects,” Hapanowicz says.

Approaches to Innovation

Livingston advises taking a gradual approach to innovation. “Develop a small, focused prototyping team to enable the organization to quickly test ideas and technologies through a repeatable methodology, resulting in a prototype, which can eventually be scaled or abandoned.”

An enterprise-wide innovation lab, coupled with specific idea generation incentives, can be very effective, since it encourages thinking outside the box within a focused and safe environment. This method allows innovation to be applied across the entire organization. “Having innovation only within operating teams tends to minimize both the funding and the ability to scale beyond the initiating area,” Chowning explains.

Hapanowicz reports that Dell Digital has taken a multifaceted approach to supporting developer innovation. Her organization offers teams a fully automated cloud incorporating a catalog of robust services and a completely automated DevOps pipeline. Development productivity and quality have both skyrocketed, she says. “Developers are now spending between 72-75% of their time writing functional code and using their creativity and talents to introduce new solutions that add value to Dell and our customers,” Hapanowicz says. “We're closing in on our target to hit 80% while we are also thinking through our next major innovation.”

Funding for the Future

Scott Buchholz, US government/public services CTO for IT and business at advisory firm Deloitte Consulting, advises dedicating a set amount of funds every year to new, emerging, or innovative technologies and approaches, forcing both the focus and prioritization of research activities. “Done well, it can also help normalize the culture of experimentation and occasional failure,” he notes.

Buchholz believes that organizations that succeed best at innovation tend to invest consistently in experiments and tests, allocating 5% to 10% of overall budgets to experimentation. “Depending on the organization and desired focus, allocations will look different,” he says. “If you're just starting on your journey, your budget might include 70% for sustaining, 25% for changing, and 5% for innovating, but could move to a 60/30/10 model over time.”

For innovation to flourish, IT leaders must be intentional about giving teams opportunities SAS's Tweed advises. “Employees need to be encouraged to explore creative solutions with the understanding that not all of them will succeed but recognizing that the effort is as important as celebrating the successes.”

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