INNOVATION: THE GREAT DIFFERENTIATOR

by Borys Stokalski, Senior Consultant, Cutter Consortium

The capability to out-innovate the competition is becoming increasingly critical to business success. Taking innovation risks can lead to spectacular success, such as the Japanese DoCoMo mobile network, Google, and personal computers. But sometimes attempts at innovation become catastrophic failures and rise to the surface of public awareness. Examples of disastrous innovations include obsolete satellite networks and vastly overpaid-for new-generation mobile network licenses.

Perhaps one of the most striking examples of how investment in technology innovations can be mismanaged comes from the history of the modern American military. In 1982, Franklin Spinney, an analyst in the US Tactical Air Command, backed by US Air Force Col. John R. Boyd and a group of military reformers, published his famous report on US military budgeting policy, "Defense Facts of Life" (or as it has become more widely known, the "Spinney Report"). The document, which stirred a heated debate and inspired the US military reform movement, stated that the pursuit of complex weapon systems based on immature technologies had caused enormous overspending, thereby crippling the US capability to withstand a prolonged large-scale military conflict. The authors argued that both the costs of acquisition and the costs of ownership of these systems, along with their unreliable performance, had led the US into unilateral disarmament.

This was not some bizarre opinion of neo-Luddites who contested the role of technology in modern warfare. Col. Boyd, Spinney's mentor, has become known as one of the most innovative minds in the US military. He was the father of modern maneuver warfare and the inventor of aircraft design principles that have changed the way modern fighters are conceived and built. Boyd countered the "technology for technology's sake" approach that crippled US combat readiness with his tradeoff analysis, which helped blend various design concepts, technologies, and solutions into constructions optimized for combat agility and effectiveness.

This story might seem familiar to many IT executives and their superiors, who can see that their enterprise architectures are expensive to maintain, inflexible, and overly complex to the extent that no one can predict the consequences of important changes, such as retiring or replacing a major application. As a result, the vast majority of the IT budget is spent on maintaining the status quo, with few resources left for improving or innovating the business. If the ability to innovate is indeed becoming a major differentiator in the competitive environment, then perhaps our existing IT management and business-IT alignment practices also have to be reformed. It is therefore worth looking at how we can approach innovation to increase our chances of implementing the right idea the right way at the right time.

-- Borys Stokalski, Senior Consultant, Cutter Consortium