IT and Process Innovation? Why not?

Business leaders must constantly come up with new ideas that they want to remain competitive in their industries. That’s just the way things.  Those who find faster, easier, more efficient or more effective ways to satisfy customers’ needs are the ones whose businesses thrive. And when it comes to new ideas, does it really matter in which department they originated … even if that department is IT?

According to Brad Power, IT is as a good a place to get ideas for how to make a business run better as any other. In his article for the Harvard Business Review, Power cites Nationwide Insurance and ING as examples of companies whose IT departments came up with innovative business process ideas that worked.

Inside sources at Nationwide told Power that members of the company’s IT team “started using a process improvement (‘lean’) development framework and rapid (‘agile’) development techniques several years ago to standardize system development approaches.” This apparently led to teams within the organization being more efficient and productive. As a result, Nationwide has begun gradually rolling out this model to other teams within the organization on a monthly basis.

ING’s IT department helped make things run more smoothly because it “knows how to get people to work together as teams.” ING, says Power, “is in the middle of a transition from traditional step-by-step software development approaches to using cross-functional teams to make quick, small changes to systems,” something that process improvement experts David Bogaerts and Jael Schuyer believe can be implemented throughout the organization.

Lisa Helminiak, principal at Azul 7, doesn’t think it’s quite that simple. “While I think it is
critical to involve your technologists in customer service and product innovations, it has to be done in a way that will insure a customer-centric outcome,” she said.

“The examples used in [Powers’] article were focused on adopting an agile development approach and using it more broadly to engage cross-functional teams to work together better. This is one step in getting a company to make smaller incremental changes and to react more immediately to the marketplace, but this alone does not ensure good outcomes.

“I’ve seen cross functional teams, especially run by IT, get way off target because they do not understand their customers. IT in many organizations are notorious for being insulated from customer feedback or insights and are charged with containing costs and keeping enterprise information secure.

“While I think IT input, understanding and insight are critical, it will only work in organizations where senior management expects everyone within the organization to deliver the right products, services and processes that focus on customers’ needs and wants.

“Really focusing on your customers requires ongoing engagement with them through multiple channels. It requires an ethnographic approach to uncovering opportunities to serve them better, and it requires a deep and regular engagement with other members of the organization who do engage regularly with customers such as sales, marketing or customer service.

“Agile processes help make change easier, but they don’t identify what changes need to take place. IT teams have a piece of the puzzle, but they need to have tools to help them keep their companies’ customers at the center of the design and development process.”

Got that?

If innovative ideas from the IT departments can work for large organizations like Nationwide Insurance and ING, then it stands to reason that they could work for small and mid-size businesses, too. There’s no law that says the best ideas for a business have to come from the CEO or the marketing department. As long as the customers’ needs take precedence, any department can be the one that “saves the day.”