Putting innovation to work

This article is a follow-up to the one that appeared in the Forum section in our Jan/Feb issue, which focused on how CIOs can create innovative cultures. Here, we explore how to create processes for innovation.

On the surface, putting ‘innovation’ and ‘process’ together seems oxymoronic. Process conjures boundaries; innovation, some say, is best fostered in unfettered environments. But smart CIOs understand the need for both in pursuit of the new.

Through an initiative called ‘Connect and Develop’, Procter & Gamble’s CEO has mandated that 50 percent of the company’s innovation come from outside the enterprise. Robert Scott, P&G’s vice president of innovation and architecture, Global Business Services (currently on loan to CincyTechUSA, an organization to drive growth in Cincinnati), is charged with realizing this goal in IT.

“You’re going to have to let innovation flow in and out of the walls of your organization and in and out of your company,” Scott says. Therefore, he built connections to the labs of P&G alliance partners like IBM, SAP and Hewlett-Packard and conducts regular ‘discovery journeys’ to Silicon Valley.

For the ‘develop’ part of the mandate, Scott and the rest of P&G employ SIMPL (Simplified Initiative Management and Product Launch), which shepherds concepts toward execution. This process is broken into six phases: Discovery, the search for opportunities and ideas; Design, where concepts turn into prototypes; Qualify, where ideas are validated; Ready, preparing for launch; Launch; and Leverage, a step Scott added to market and maximize adoption of IT solutions.

At Stanford Hospital & Clinics, CIO Carolyn Byerly implemented an innovation process framework in the aftermath of a decision to outsource IT to remake the CIO’s office into a more strategic and innovative one. “I wanted a structured way to select ideas and take them all the way to execution,” says Byerly. Her framework includes risk analysis, a key element for this US$1.4 billion healthcare organization.

Byerly’s five-phase process framework encompasses governance and project management. Each phase has its own metrics, such as the number of new ideas generated, elapsed time to selection, and the percentage of internal and external resources used. Byerly uses the metrics to report on the progress of her projects, which in turn enhances the credibility of the framework.

Like P&G, Bayer North America has a corporate innovation initiative to harness ideas wherever they exist. Called ‘Triple I’ (Innovation, Ideas, Inspiration), the program is supported by a global employee portal. All IT-related ideas are sent to Claudio Abreu, senior VP and North American CIO, Bayer Corporate Business Services, who turns them over to an innovation team that engages business users to validate their potential and appeal. If the business likes the solution and it’s proven viable, the idea goes through a project request process and moves into a pilot phase and then, potentially, to production.

One notable success story is Bayer’s implementation strategy for a MySAP upgrade affecting 25,000 global users. Developed via the innovation process, it improved Bayer’s ERP implementation and testing results through a combination of commercial software tools and a new approach to engaging the business. The result was a MySAP platform designed to support a $9 billion company implemented in less than six months.

Ideas can come from anywhere and CIOs must seek them out by forming alliances, through staff portals, or from innovation teams. CIOs need also remember that for every upside that a new idea brings, there’s also a downside. An evaluation and testing process allows IT to understand an innovation’s risk. Risk analysis must be part of any innovation methodology. Finally, create a process that works for your organization and make sure you’re a big part of it.

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William Golden is a senior program manager for the CIO Executive Council.

New is hard

Q: What is the most difficult aspect of your innovation process?

A: According to Robert Scott, VP of innovation and architecture, Global Business Services, the trickiest part of Procter & Gamble’s innovation process is the Launch step, when an IT innovation is ‘commercialized’, or adopted by customers. The challenge, as Scott sees it, is that “even if you develop something that’s good, people are slow to adopt new things.” IT, he says, must talk about what it’s done in a way that will excite users and compel them to change their behavior. Scott has tapped P&G’s own marketing experts and hired external firms to help him tell a better story about the innovations his organization is delivering.

Claudio Abreu, CIO of Bayer North America, also sees change management as an important part of the innovation process. “Change is not easy; it takes a lot of commitment and leadership from the CIO,” he says. To make sure the innovation process is embraced, Abreu participates personally in innovation team meetings.

For Carolyn Byerly, CIO of Stanford Hospital & Clinics, the first phase of her innovation framework, Sense, was the hardest to define and develop, as it wasn’t a typical part of project management. In Sense, the IT team learns about stakeholder needs, conducts research, meets with vendors and so on. It’s not so much about generating ideas but about getting the knowledge that can create a vision from which an idea will follow.

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