By Andy McCue, 26 April 2007 08:00
NEWS
CIOs and the IT department are in danger of being relegated to the role of support function because of a lack of vision and technology innovation.
A new report by the London School of Economics (LSE) and PA Consulting warns IT innovation is often stifled because of a focus on automation and streamlining.
It says the current explosion in blogs, online trading communities such as eBay and virtual worlds such as Second Life show customers want richer, IT-enabled interactions that blur the traditional boundaries.
Patrick Kelly, head of IT consulting at PA Consulting, told silicon.com: "This so-called information age is just beginning. There's a lot of exciting stuff going on out there - banks using Second Life to design branches, energy companies using it to design petrol stations, financial services companies sharing internal blogs with customers."
Dr Carsten Sorensen, senior lecturer in information systems at the LSE, admitted some of the new web 2.0 technologies are still finding their feet in a business context.
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But he added: "Companies need to listen to customers. Take the next step and use technology as a platform to engage people in discussion."
Gartner has also warned that technology is being seen less and less as a force for driving business growth by CEOs because of a lack of vision by IT leaders.
Steve Prentice, VP and distinguished analyst at Gartner, speaking at the analyst's annual Symposium in San Francisco this week, said the IT industry is missing visionaries who can challenge conventional wisdom.
He said: "CEOs are looking for new ideas and many just don't see them coming from the IT department - too many of whom are waiting for someone else to make the first move. Inside too many enterprises there are too many people waiting - waiting to be spoon-fed a pre-packaged solution for how to apply technology to their specific problem."
Gartner's advice for CIOs is to set up an "office of transformation" think tank that works with consumer research and searches for new ideas, concepts, processes and new technologies that can help drive business growth.
Comments
There are 10 comments. Join the discussion
1. swhitear
It seems incongruous to insist an IT department is run as a reactionary cost centre to a tight budget whilst also fostering the sort of creative talent required to drive the business.
The CEO is ultimately responsible for the culture of an organisation, and for setting the goals of its employees. If a CEO bemoans a lack of vision from the IT department, it is more likely to be caused by the way it is run than any lack of ideas from within, and the buck for that stops at the board level.
2. Eric the Disillusioned
Thats it guys, keep feeding the Web 2.0 hype until it blows up in our faces and sends us back to the dark ages again.
The board look to a CIO to deliver effective IS/IT for the organisation. Innovations such as Web 2.0 are never streamlined enough to be obviously cost effective and are not proven enough to give confidence that they deliver immediate productivity gains.
I agree whole-heartedly that CIO's should investigate the use of innovative technologies such as Web 2.0 and develop possible applications for their use but not within the board room where the emphasis is on results rather than opportunities. Instead they should be in the engine room of IT, under the covers until a substantive argument for their use can be presented.
Until then, CIO's would be taking a risk to press the innovation button without a clear directive from the board to do so.
3. anonymous
My experience leads me to believe this is not a issue of lack of vision but an issue of resources. The head of the IS/IT/MIS ... Department is hesitant to bring up new ideas due to already strapped resources. Yes, the CEO wants new toys and new ways of conducting business but just as long as we do not add any more bodies to the headcount. This is a case of one gets what one pays for. As a matter of fact, many Information Officers will push back and attempt to kill any bright ideas that may impact their resources. Right now, until expectaions and budgets change, keeping the ship afloat is the main focus (unless the CEO brings in an outside consultant as the pocket book seems not to be as important when this happens).
4. Nick Cole
Largely because the CIOs are still tyring to make the last set of new ideas work properly!
Too many organisations leap from innovation to innovation, involving revolution and major change without giving things a chance to bed down and work out the wrinkles.
Yet we see reports of the banking industry still relying on 30 year old software! Why? Because it works!
The old mantra - 'if it ain't broke don't fix it' is still very relevant. Also part of the drive to innovate is nothing more than a search for new ways to exploit customers. Why is there such a rise in complaints about inept handling of problems, call centres, poor service and so on? It is because good mainenance of service in the background is not seen as good for careers and credibility. Introducing new ideas instead of making them work is seen as the thing to be in.
5. anonymous
I suggest that part of the reason many IT departments are not seen as innovators is because they are associated with, and the creators of, "reasons why you cannot use/do ....... " with technology. This is manifest all over silicon.com in the "why we won't let you use the web fully at work"; "why VOIP is risky"; "why you can't IM to the outside world"; "why you need to be afraid of staff with iPods, USB memory, camera/MP3 phones etc etc.".
Innovation, by definition = RISK and many IT departments are so busy locking down in an attempt (futile!) to have zero risk that they are, at the same time, stifling innovation and earning the warranted reputation as a load of Jermiahs. It's a mind-set thing! It is hard to be innovative and creative with a "control and inhibit" behaviour pattern.
This may not be their fault in all cases - some of them are driven by technophobe (or techno-illiterate) business executives. But then it is up to IT to educate them!
6. Simon
In responnse to Anonymous consultant, I aree to a point that IT is risk averse. But ...
... this is often imposed from outside.
At my last job we used to have a fairly 'user friendly' approach to things, but being ultimately US owned we came under Sarbanes Oxley. Hence seemingly endless reviews, audits, 'problem' reports, etc, etc until we had things made as tight as a ducks backside (something that's supposedly watertight !) or as near as we could achieve.
And as others have pointed out, doing all this with a shrinking budget, ever more demands on our time, etc, etc.
And of course the (also previously alluded to) problem that the bean counters won't pay for anything you come up with to be pro-active, but complain when you are purely reactive.
7. Lee Clayton
I am a firm believer in innovating, but why should this be landed at the door of IT ?
Innovation in business is a business competency not just a CIO/IT departments competency!
For a business to successfully innovate it requires a partnership between differing business disciplines, but with people with the correct competencies to be visionary.
8. anonymous
For years there has been talk about businesses not investing enough in R&D. Innovation through the use of technology is R&D.
Unless a business mandates that R&D must occur, it will not make it sufficiently up the list of business priorities to allow time to be spent on it.
It requires a supportive CEO/MD & CFO to allow this to happen.
Innovation can happen from anyone in a business not just IT. Channels must be developed to allow this free-flow of innovation to occur. It does however require business-savvy IT personnel to assit this process. They must not only be able to add to the innovate process with idea but also to help translate the ideas of business colleagues into a realisable vision.
Those businesses that do not realise that they must innovate will eventually stagnate.
They certainly will not be market leaders or realise the true protential of their businesses.
9. David Chassels
Is it not a classic catch 22? Until CIOs have a tool that can rapidly respond and deliver what the business want to do in terms of new ideas for its processes, concepts, etc then there is not much they can do? Even if they did it would sit uneasily in conventional IT so as the article suggests this needs to sit outside in the "office of transformation".
NOW as for the comment "the IT industry is missing visionaries who can challenge conventional wisdom" that is exactly where I have been. Being a "visionary" in UK with innovative software that completely turns on its head the build of solutions that allows business knowledge to be "digitised" exactly as required by the business is a very painful place to be. We have a big cultural issue in this country starting at the top the combination of "spin” and "spoon feed" is truly debilitating. In "IT" it is not all the fault of the CIO although who can blame some adopting for the “do nothing” survival strategy!
10. N. Venkatraman
In many companies, IT organizations do not have the skills and competencies to innovate. It is simply because, we have been expecting them to focus on implementation and efficinecy goals and not on innovation and effectiveness goals. The end result is that most IT organizations do not have the requisite competencies to step up to the innovation agenda. I see this as a major issue inhibiting companies to leverage IT to drive growth and innocations.