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Innovation strategies framework to help businesses thrive in the digital era

Technology is marching at a breakneck speed and organizations are relying on innovation to keep pace with the changing ecosystem. The big four technologies that are driving business innovation — social, mobile, big data analytics and cloud, referred to as “third platform” technologies by IDC and as the acronym SMAC by others — are changing enterprise IT and the way businesses and customers communicate with each other, requiring businesses to evolve their strategies in order to thrive.

And CIOs play an important partnering role when it comes to innovation, said Fred Magee, adjunct research advisor at IDC.

In an IDC study titled Creating Innovation Strategies — Learning to Think beyond Enterprise Boundaries, Magee details a framework to help IT leaders who are using IDC’s Leading in 3D approach in creating multi-tiered innovation strategies within an organization.

Magee sees the L3D model – designed to help IT leaders create an IT strategy that aids their organization’s digital transformation — as the implementation end of innovation.

“The point of creating an innovation strategies framework is to create a context within which business leaders and CIOs can understand how the world is changing digitally and where they need to make investments and change their business models, IT infrastructure and their processes to adapt to that changing world, from large transcendent changes to small incremental ones,” Magee said.

IDC makes clear that innovation is not a one-size-fits-all process. The innovation strategies framework is designed to help organizations realize the kinds of innovation they need in relation to their business strategy, he said. The framework has three tiers of innovation: Disruptive, adaptive and incremental.

“If you think of disruptive innovation as driving innovation toward the market, adaptive is recognizing that the market is changing already … and incremental is driving innovation one step at a time,” he added.

The three tiers of innovation may seem separate, but they are not, he said. Even organizations that are disruptive by design will operationalize their disruptions sometime, he added.

CIOs can connect the dots between organizational priorities and technological possibilities.

“[The] CIO is really going to be more of an innovation partner and is going to be in a position to identify the best means for using digital technologies to support the digital transformation of the business that the executive, marketing and sales leadership and perhaps the board have identified as being critical to the business’ future,” Magee said.

To identify the right types of innovation, it is important to recognize external drivers like customers and market changes and identify the company’s leadership style — visionary or cautious — and whether it is willing to launch a significant innovation, he said. Determining a company’s business goals — whether it is trying to achieve competitive supremacy or competitive equality — comes next, followed by the execution phase, he added.

“When you start to define the ideas that actually make sense to your business, then you say, ‘OK, this is a manageable, moderate amount of innovation that might be possible to do on a continuous basis because we understand the investment profile for this kind of investment and now we have to execute it.’ That’s where L3D comes into play,” Magee said.

L3D is a process for turning ideas into deliverables, Magee said. It is about first identifying what needs to happen, then taking it through a process of innovation, integration and incorporation, he added.

The innovation strategies framework has four stages: analysis, ideation, L3D delivery and evaluation.

“Using this innovation strategies framework, hopefully you will have engaged your stakeholders, business leadership, in a process of identifying the right places to innovate and also a process for making a business case for it,” Magee said.