Innovation is the next great idea. It is Twitter, the Swiffer sweeper and Tesla, and far more than version 3.4 of software, the Nutribullet Rx, or the latest Toyota.
As Henry Ford supposedly said, “If I had asked my customers what they wanted, they would have said “a faster horse”.
Successful product innovators, the ones with the next great idea, have followed many paths to success.
They think big and bold, with ideas that don’t seem possible. Five years ago, did anyone think there would be the possibility of drones delivering packages? 20 years ago, did anyone think that telephones would be carried in our pockets, free of the wires that confined them to the home and office?
They create solutions to problems, not solutions in search of a problem. How many tech companies design software and then try to find buyers? Scott Cook (QuickBooks) did the opposite. He came to understand that small business owners need to spend their time selling, so a product that made accounting much simpler was perfect for them.
They experiment and evolve. While the Financial Times continued to sell its respected news content, it turned its delivery and revenue systems upside down by moving from paper to digital subscriptions, pioneering the metered access model. As a result, it was not one of the hundreds of hapless print publications to close during the past decade.
Innovation is often easy for the two guys in the garage. But how do you get to innovation if you’re a large company, one with a product and presence in a market? How do you get beyond versions two and three of your first innovation?
Larger companies get distracted from pursuing innovation because don’t see how to devote resources to it while still running day-to-day operations. It’s because too many resources are consumed by daily activities, such as keeping track of processes, assets, data, risks and everyday business endeavors. Information is duplicated in many places; there are multiple versions and no one knows the truth. Usually, this mission-critical information isn’t properly recorded, updated or shared.
Pioneering CEOs recognize that in order to get to innovation, they first need to pump more efficiency into their organization. They need the ‘single source of truth’ about their company … how it actually runs, the details about the processes that get the products out the door and the money in, who’s doing what and when, how what one person or group does affects others up and down the line, a complete record of all assets and their useful life and the risks that could derail the business.
To get to the "single source of truth", these executives know that they have to automate the collection and recording of knowledge about their business operations and use this information to connect people throughout the company.
That’s enterprise architecture and it’s helping companies create a united, interactive view of the business, its assets, processes and risks. It’s increasing collaboration by sharing the information among employees, work groups and managers across division lines and geographies. It’s putting the right information into the hands of executives so they can initiate successful transformation programs.
When companies arrive at the ‘single source of truth”, the IT department better understands the resources business groups A and B need for product development. Production has a grasp on precise inventory availability and needs and can tell shipping how to plan to move products to customers faster and at less cost. Management can see product lifecycles connected to revenue projections. Division leaders can identify and manage new risks that arise when business changes occur.
That’s when they will have the resources both to run the business better and get to innovation.