Digital leaders: Driving pace and scale in a dynamic market, part 3 (innovation)

In this series of blogs on digital leaders, we’re sharing key findings on the impact of digitalization on an organization’s structure and what digital leaders are doing in response. These findings are based on the 2017 CGI Client Global Insights, which include insights coming from face-to-face interviews with more than 1,300 business and IT leaders, as well as research we conducted in partnership with IDC in which more than 200 business leaders were surveyed on the topic of organizational design.

The focus of this third blog is on innovation—how digital leaders today are competing beyond traditional business and market boundaries, driving innovation to move ahead and creating disruption. In a digital world, the speed and scale of innovation is critical. Organizations need to come up with and implement ideas quickly to stay ahead. They also need to innovate across the entire business.

Our findings show that:

• 62% of digital leaders have a separate innovation group focused on driving innovation
• 43% of organizations are implementing open or crowd-sourced innovation
• 24% of organizations are using innovation and experimentation processes to drive new services to market

All digital leaders have an innovation strategy

Leaders view having a separate innovation group as critical to developing differentiated products and services. Although 62% of digital leaders have a separate innovation group, there’s movement toward innovation networks, where organizations innovate through partnerships, communities, alliances, acquisitions, joint ventures, licensing and other collaborative relationships within and outside of their ecosystem. Forty three percent of organizations are implementing open or crowd-sourced innovation.

As digitalization increases the demand for innovation, the process of innovating is changing. It’s moving beyond rooms with whiteboards into factories where ideas can be prototyped, tested with partners, suppliers and customers, and launched as minimum viable products (MVPs). And, it’s also becoming more dependent on enabling processes and technologies, such as design thinking, lean startup, agile, DevOps and cloud. When Tesla, for example, comes up with a new dashboard feature, it can launch it overnight to customers via the cloud, compared to other car manufacturers that have to ask customers to bring their cars in to be serviced. Agile-driven development approaches get ideas into production quickly, while enabling technologies like the cloud support fast delivery.

Organizations approach innovation in different ways. Some organizations are pursuing an MVP approach, which is less risky because the idea can be tested before launch and improved at pace post-launch. Others are investing in big-bang innovation by releasing the idea immediately into the market. This approach can provide big payoffs if the idea is successful.

According to our findings, 24% of organizations are using innovation and experimentation processes to drive new services to market, and 28% invested in grassroots innovation.

Does your organization have an innovation strategy? What type of innovation approach has your organization adopted? Are you engaging in a wider ecosystem for innovation?

Share your thoughts in the comments or, if you would like to learn more, contact me. You can also visit our digital transformation section.