The Age-Old Innovation Conundrum
Unfortunately, IT is often perceived as delivering cost-based services rather than providing strategic innovation
By: Denise Dubie
Mar. 3, 2013 12:00 PM
By Jackie Kahle - Over the past 6 months, CA Technologies has been running IT innovation-related polls on http://www.ca.com/. On average, these 9 polls garnered 660 responses each, and present a stark picture of the challenges and frustrations that come with being an IT leader today.
While some of the results are presented in this recent infographic, it doesn't fully answer the question that, gauging from our polls, is still plaguing IT departments everywhere: the age-old conundrum of how to do more with less, or to be more precise, how to replace the tires on your car while still driving down the highway. So today, I'll delve a little deeper into our poll results to see if we can better understand the problem, and find a solution.
Innovation: IT is worth it and IT knows it
In looking at the poll data, one thing is clear -- IT totally "gets it." By this, I mean that they understand their critical role in driving innovation for their business, and recognize the importance of embracing new technologies to help them do this. Here's the proof: 43% of our respondents listed IT as the #1 source of innovation, more than doubling those who voted for the external customers and clients, the response that came in second (see Fig 1).
And when it comes to those new technologies IT is embracing, 42% of respondents cite "Anything-as-a-Service" as a key driver of innovation. They are also huge fans of cloud computing. When we asked: How does cloud computing help drive innovation? We found that most believe that the cloud helps them deploy and scale faster, enable brand new services, and free up staff and budget (see Fig 2).
Follow the money
We also discovered the overall benefits of innovation to the business are compelling and include higher customer satisfaction, competitive advantage, and faster time to market (see Fig 3).
So then, what's the problem? What's holding organizations back when it comes to innovation? Three words: budget, budget, and budget. 84% of our respondents cite budget, resources, or maintenance spending as their biggest impediment to innovation. In fact, 50% are spending 80% of their budget or more just on keeping the lights on. In other words, there's barely enough funding to cover the maintenance needed to keep technology functional, let alone to spend on innovation.
This was reinforced again when we asked respondents to name one organizational change that would provide the biggest opportunity to increase innovation. Not surprisingly, 44% cited increased budget or staff. Another 44% cited new technology adoption. (This just further proves our earlier discovery that IT "gets it." (see Fig 4).
Age-old conundrum, new solutions?
This issue of not having enough budget for innovation because resources are being consumed with current operations has been highlighted time and time again. But that doesn't mean it has to be the show-stopper. Two previous blog posts by CA Technologies thought-leaders Jason Meserve and Andi Mann shine a light on the way out of this conundrum.
In his post entitled Three Ways to Pay for Innovation in 2013 Without Upping the IT Budget, Jason suggests several strategies. The first is to audit your hardware and software inventory to ferret out waste, including software that isn't being used at all, systems that can be consolidated, and other ways to rationalize your existing infrastructure that can free up budget for innovation. His other recommendations are to right-size your infrastructure to avoid over-provisioning, and to reach out to your CMO and marketing department, which might mean funding a large amount of IT spend on their own -- something you might be able to tap into if you collaborate with them rather than ignore them.
Next, Andi Mann has sterner advice in his post entitled Please Stop Citing Lack of Budget as a Roadblock to Innovation. Andi believes that the problem lies in our perspective, not our budget. The countless business leaders he has spoken to say that there is always budget to make money, and the CEO and CFO are open to investing in projects which offer a strong payback in new revenue or more profitability.
Calling all IT leaders
Unfortunately, IT is often perceived as delivering cost-based services rather than providing strategic innovation, and the responsibility for changing this perception lies squarely with IT leaders. The most innovative of these don't believe they should have to fund innovation from their existing budgets, and never even consider that as an option. As Andi says, "they made the case for new budget and won it, because the payback was there in black and white."
So, the solution to this conundrum is clear: IT needs to stop being their own worst enemy, and position their innovation projects in a way that demonstrates clear and measurable value to the business.
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