IT Enabled Innovation

Almost everywhere technology is evolving from a functional silo to a foundation for breakthrough innovation in products, services, and business models. Advances in technology platforms ranked as the most important factor driving innovation. IT-enabled innovation comes in many flavors. It can mean using advanced analytics to improve decision-making, employing digital technologies to retool manufacturing, and harnessing mobile capabilities to improve marketing, to name just a few. The crux in all cases is the creation of a platform that can be leveraged repeatedly to deliver impact. In our experience, technology platforms can bring benefits in at least four areas: cost and timeline reduction, often though automation; business transformation; the enhancement of process; and, most significant, business model innovation through the creation of new types of products and services.

IT-enabled innovation is a process and the result of a process extending from the technology breakthrough, which is typically a result of basic or proprietary research, application development, testing, deployment, and finally customer use and acceptance. To qualify as truly innovative, new IT applications must successfully achieve that final step: customer value cocreation, adoption, and acceptance. Without customer acceptance, this new technology isn't an innovation; it's just a failed product or service that didn't gain traction. We're now well into an era in which significant competitive advantage is achievable from IT-enabled business innovation. The wide adoption of big data, analytics, cloud computing, social media, mobile, and emerging IT-related innovations such as smart systems, cognitive assistants, and the Internet of Things (IoT) has dynamically changed the competitive landscape. Businesses that intelligently and innovatively apply information technology to create superior business and customer value are pulling away from those that do not.2 Indeed, it's becoming increasingly clear that IT-enabled innovation is the core capability that differentiates the winners from the losers. Growing knowledge of ICT design, execution, storage, transmission, and reuse along with the Internet's evolution is creating opportunities to configure IT into service relationships that create new value. IT-enabled innovations—digital innovations—have great potential to reduce costs, increase efficiency, and improve outcomes.