Innovation strategies being turned on heads

Innovation in business IT has for the longest time traveled along a top-down path. Throughout history, the IT vendor community largely looked to develop systems, tools and applications specifically for larger companies. Eventually over time, these products slowly made their way down market as somewhat less functional and significantly cheaper offerings for smaller business.

There was a good reason for the top-down development approach by vendors. Reality was that big businesses had the greater requirement for IT and, generally speaking, large companies were apt to do much more meaningful and interesting things with it. But times have changed.

Participative online behaviour — nurtured through e-mail, blogging, wiki collaboration, Web 2.0 technology and social networking in general — shows the most interesting application of technology is now occurring from a radically different direction. It’s power and business opportunity driven by the masses.

Businesses are already rethinking innovation strategies. Many are focusing on the consumer in order to identify need and the future direction of product development. An online story posted on Industry Week magazine highlighted Procter & Gamble Co.’s launch of a Web site for women to “share inspirational stories,” practical tips and information. The effort was designed to better understand the product needs of women. Likewise the story said toymaker Lego Group, Nestle, L’Oreal and Nokia are among those companies actively reaching out to consumers for product development ideas.

In the realm of IT, networking giant Cisco Systems Inc. is among the first to formally embrace the concept. During the company’s recent Partner Summit in Las Vegas, company chief development officer Charles Giancarlo put it bluntly. “What’s changed is where the new technology trends come from,” he told the gathering. “It used to come from the enterprise and their data centres and then it trickled out. It’s the consumer that’s driving a lot of new technology trends and that is backing up and hitting IT managers.”

And today’s most influential consumer is the generation that was raised on personal computing and encouraged to incorporate IT into their everyday lives. They experiment and work with IT in a way that’s tailored to suit their personal preferences and business lifestyles. It’s a far cry from corporate IT dictatorship that imposed restrictions upon the application of IT beyond a defined business scope. These users expect a technology experience that surrounds their life, Giancarlo said. They want the same experience no matter where they are. He explained that if you look behind the technologies and the Web sites of social networking, you’ll discover the ways in which they collaborate. And collaboration, particularly as it’s being developed and advanced in the consumer space, is the key to Cisco innovation going forward.

The more we can do to enable technology to allow people to collaborate, the more powerful the use of technology, Giancarlo reasoned. Technology personas are also starting to blend, he said. In this case, Giancarlo was referring to the differences between how a consumer and an employee might want to use technology.

“You’re using the same tools and devices — it’s blending and blurring,” he said. “Another is the difference between working and relaxing. The technology you use in one environment and another is also starting to blur.”

So Cisco is embarking on a bottom-up approach to future innovation. The company believes that consumers rather than enterprises will drive the type of communications technologies that will ultimately be adopted by all business. Think of social networking and Web 2.0 that have taken the consumer space by storm. Businesses today are frantically trying to figure out how these might similarly be applied as a means to reaching out to consumers and other business partners.

Consumers driving technology trends in business? It begged the question to Giancarlo: What was the epiphany that made this apparent?

“The one that did it for me was instant messaging,” Giancarlo said, during a separate interview. “Five years ago, I saw traders in New York City sending messages between each other on instant messaging as part of their trading.

“I realized this was a consumer technology meant for consumers that is not being hosted by that enterprise. In fact, it didn’t have any security, yet they were using it and this was forcing instant messaging into the enterprise

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