Top 6 factors that influence IT-driven innovation
Credit Suisse states that the average lifespan of a company has shrunk to less than 20 years. Studies on corporate survival show that one of the main reasons for this change in the longevity of a business is due to technological disruptions, which alters the market expectations.
In this scenario, doing the same things that yielded good results will fail. “If you want something new, you have to stop doing something old”, says Peter Drucker, the father of modern management. True to Druker’s philosophy, companies that thrive in a technology economy do things differently and are considered as innovation accelerators.
Innovation accelerators focus on IT-driven innovation as their core strategy. They differentiate themselves with technology to stay ahead in the market and bring new value to the products and services that they offer. Like Amazon in retail, Uber in transportation, and Airbnb in hospitality, innovation accelerators leverage technology and data to create new markets. A recent HBR review lists common traits found in innovation accelerators:
- They initiate innovation from the top level management and often, CIO’s lead such initiatives.
- They follow a structured approach to innovation and move fast.
- They encourage cross-functional collaboration to seek new business perspectives.
- They have strong IT departments to support new business ideas and opportunities.
- They invest in innovation, not only in terms of dollars, but also try to run on a lean budget by leveraging creativity.
According to KPMG benchmark findings, 56 percent of leaders expect that their company’s overall investment in innovation will increase in 2020. Also, almost 61 percent of the leaders face challenges when they try to scale innovation initiatives. While there is no doubt that IT and technology are the major innovation drivers, here are the top 6 factors that contribute to the success of innovation accelerators.
1. Good understanding of business
Leaders of innovation accelerators understand their business, employees, and customers. They have a clear vision to develop new products and services, with the right IT talent to drive their innovation agenda. By understanding the shift in digital platforms and the customer response, leaders help companies to move from a sales focused funnel to a customer centric journey. Taking decisions by understanding how the business works, what customers prefer, and what people are trying to do enables a strong foundation for innovation.
Robotic Process Automation (RPA) is one of the major technologies meant for automating repetitive tasks that lead to operational efficiencies. Using RPA, operational leaders can free up human resources and offer them the much needed time to think, study, and innovate. A word of caution, RPA can become a double edged sword, if it is used merely to come up with a workaround or a temporary solution to obtain the much needed time. Read this five-point checklist that can act as a prerequisite before embarking on RPA implementation.
2. Business models
Companies, which follow long-standing business models, are subject to disruption and might end up in outright destruction. Whereas, innovation accelerators upscale their business model’s underlying technology to increase their profits. Accelerators don’t stop at automating business processes or innovating their services. They consciously look at modernizing their technology stack and create new applications and platforms to evolve in their business.
Here is an example of our client who offers a through-channel marketing automation platform that enables smart marketing automation and partner management. The advent of data-activated marketing challenged our client, where they faced a tough time in engaging their customers. They required extensive data management to anticipate their user expectations and proactively nudge their users in the right direction by offering irresistible deals. Imaginea came up with an innovative solution to retain their customer base and hold their market share. We developed a hybrid data architecture design, in which only minimal disruption occurs in their existing environment and at the same time, offering maximum scalability. This prioritized data consumers over the data sources and internally resulted in effective space, time, and resource management.
3. Products and services
Organizations generate value from strategic partnerships and building adaptive ecosystems of products and services. They find ways to connect individual products and services to create a robust and scalable system. This is mainly done to create valuable connections between distinct offerings that are preferred in the market. With customers at the forefront, accelerators break away from conventional methods that restrict communication between disparate systems. Such organizations lean towards interoperability, integration, and modularity to build sustainable ecosystems, which solve the needs of the present and can expand to accomodate the future.
Here is an example of our client in the field of health intelligence. They provide advanced analytics on patient medical records to deliver personalized health insights. Healthcare data comes from multiple Electronic Health Record (EHR) systems, each with different formats. It became difficult for the system to process such varied formats. Data integration became a bottleneck and a major concern for our client. Imaginea developed an interoperable platform to obtain digitized health data from multiple EHR systems and extract clinical information, de-dupe, transform, and store it in custom schemas for further processing. Through this methodology, our client increased the reusability of components and usability of multiple technology stacks for future expansion.
4. Customer engagement and insight
Customers prefer brands that anticipate their needs, understand their motivations, and address their pain points. Organizations need to think from the customers’ shoes and engage/support them at every stage in a customer journey. Accelerators operate effectively by knowing their customer behaviour through the data from social media, connected devices, and mobile applications. They invest in relevant channels that drive engagement and bring value to their customers. Mining unstructured data to find real-time analysis of customer-generated data unlocks rich customer insights.
Here is an example of our client, who is one of the largest retailers in the world offering a wide range of premium products online. For their online business, they were looking for a configurable customer service chatbot to engage their customers and be present for them round the clock. Imaginea came up with the idea of having a native-like chatbot plugin built using the React Native framework. This increased customer touchpoints, leading to increased productivity and customer satisfaction.
5. Customer experience strategies
Customers expect seamless, immediate, secure, omnichannel, on-demand, convenient, and personalized experiences throughout their journey. Customers of this era welcome self-serving facilities to independently cater to their needs. Machine learning is widely used to analyse customer behavior. Insights from these self-learning algorithms can help in building rich experiences that delight customers.
For example, we helped our client, a global leader in retail automation, to create a cloud-based store management portal, which virtually handled the end-to-end kiosk operations of a retail store. We leveraged machine learning techniques to understand buying patterns and analyze product promotions.
6. Encouraging end-user ideas and application development
Creating cross functional platforms and forums for employees to communicate across the business is a prerequisite to encourage and welcome ideas. They seek out people who can ideate and provide opportunities to scale successful innovations. They even partner with innovators/innovative organizations or crowdsource to generate ideas for unsolved problems..
Based on the insights from historical sales data, our client was looking for ways to predict the area/accounts that can be targeted and set trackable sales goals for around 1500 individual sales executives and their managers. As a technology innovator, Imaginea came up with an application called Sales Plan, which is based on Salesforce CRM, for different types of users, spanning across hierarchies. Using this highly customizable tool, our client enhanced communication between different hierarchies and with external stakeholders. The solution even provided better analytics for senior management to understand the organizational goals.
So, do you want to innovate?
The most successful players will be those who continue to experiment and innovate with new business models and approaches, and at the same time defend their existing turf. Rate 1 to 10 (10 being outstanding and 1 denoting poor acceleration) for the above mentioned factors to learn how you fare in the innovation journey. If your personal ratings total more than 7 for each of the above factors, your organization environment can accelerate innovation. If your ratings fall below 7, then you might need to find ways to survive the mounting pressure from the digital upstarts.