Addressing the sad state of corporate innovation

Summary:A look at vendor marketing literature shows that many tout their commitment to innovation, but at the end day, usually have nothing to show for it.  According to AMR Research, the Boston Consulting Group identified this paradox as a "serious mismatch between what companies are telling their shareholders, employees, analysts, and customers about their commitment to innovation and their real experience with it.

A look at vendor marketing literature shows that many tout their commitment to innovation, but at the end day, usually have nothing to show for it.  According to AMR Research, the Boston Consulting Group identified this paradox as a "serious mismatch between what companies are telling their shareholders, employees, analysts, and customers about their commitment to innovation and their real experience with it." 

Interestingly, survey results show that despite being unhappy with ROI in innovation, executives continue to pour money into it. Executing on innovation, it appears, is a major challenge for organizations. So much in fact, that some simply turn to outside sources in the growing trend of "innovation outsourcing" where they’re passing the buck on R&D and the development of leading edge ideas. With the mounting influence of Asia on technology innovation and the growing trend for standardized IT infrastructure, these are not exactly good signs. Organizations need to make a stronger commitment to innovation if they are to be competitive on the global playing field.

So what can they do? AMR argues the lack of ownership of the business process supporting product innovation is the culprit and needs to be dealt with head-on by assigning a dedicated leader. This can be a step in the right direction, but it takes more than treating innovation as a business process to come up with ideas that shift markets, inspire customers, and awe shareholders. IDEO and Apple come to mind; it takes the alignment of the right people, culture, technology, and timing to pull it off.  Don't know to get started? Mark Turrell, CEO of Imaginatik, lists seven key components to creating an innovation culture that can help.

With a little Googling however, examples of recent tech innovations are not hard to spot. Take the freedom that open-source software gives to developers for example. A story on LinuxInsider reports that a Linux project started by FBI officials, which grew to become the Emergency Response Network (ERN), is now deemed ready for use by large enterprises. Before the system, it took FBI agents four hours to get hold of local police chiefs. Now, the ERN system can place 10,000 calls a minute.

So the takeaway in this case may be that if your organization is migrating to open source software, cost savings may be the primary driver, but make sure you take a second look don't and pass up any opportunites for innovation along the way. 

Topics: Emerging Tech

About

Natalie Gagliordi is a staff writer for CBS Interactive based in Louisville, Kentucky, covering business technology for ZDNet. She previously worked as the editor of Kiosk Marketplace, an online B2B trade publication that focused on interactive self-service technology, while also contributing to additional websites that covered retail tec... Full Bio

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