How IBM does Innovation

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  • 1/30/2015
  • In addition to the diverse needs of new markets, CEOs face rising expectations from increasingly informed and collaborative customers.

    Customers now have far more sources of information, and the enterprise is no longer the definitive authority. In a recent survey of 1,000 retail consumers, 53 percent said they used the Internet to compare product features and prices—25 percent did so from a mobile device while in a store. And one in ten sent text messages to friends and family during shopping trips to get input or share information on products.[i]

    With the billion-user Internet, customers can broadcast expectations and share views worldwide—and publicly grade a company’s performance against them. Like-minded customers can network socially and pool their influence. And in increasing numbers of industries, customers are swapping passive roles for much deeper involvement. “Consumers” are becoming “producers,” creating entertainment and advertising content for their peers and even generating their own electricity.

    This informed and collaborative customer “can be both a threat and an opportunity,” as one media CEO from Belgium pointed out. Despite the potential downside, CEOs on the whole are optimistic.

    Many CEOs consider serving the informed and collaborative customer as an opportunity to distinguish their organizations—a chance to justify premium positioning and price. “The more informed our customers are and the higher their expectation levels, the better we will be positioned to demonstrate our differentiation,” one U.S. CEO told us.


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    Background information:

    [i] “2007 Was the Year of the ‘Omni Consumer’ According to IBM Analysis.” IBM press release. December 17, 2007.
    [ii] In our survey, the term “total investments” was defined as: all asset investments plus investment in research and development, marketing and sales.
  • 1/30/2015
  • First is the aquarium analogy – if you are in the water, along with all your colleagues, when the water goes bad, hard to tell, hard to spot the pattern, hard to see what is wrong. The water is a metaphor for your working environment. If everyone you know has the same skill and interest profile, you may not get valuable different perspectives. You should form alliances with those different from you – i.e. outside the tank. mix it up. mentor, be mentored, make connections, collaborate, get involved in other activities in the business. So the lessons are: inject different perspectives into your work, seek different opinions, those from completely different backgrounds, “out of the water”
  • http://www.marcprensky.com/writing/Prensky%20-%20Digital%20Natives,%20Digital%20Immigrants%20-%20Part1.pdf
    http://www.marcprensky.com/writing/Prensky%20-%20Digital%20Natives,%20Digital%20Immigrants%20-%20Part2.pdf
  • Social Networks get at the underlying relationships
    These relationships reveal – fragility of organizations, are people in the right roles, is the group positioned for growth/innovation,
    Revealed through SNA
    What can do about it
    Sample projects -
  • 1/30/2015
  • How IBM does Innovation

    1. 1. 1 Delivering Successful Innovation depends on Diversity CIFS, Copenhagen 27th October, 2010 Tina Easton tina@uk.ibm.comInnovationthatMatters
    2. 2. IBM Global Technology Services – Innovation Team 2 Agenda Items  Introduction  Diversity is crucial  IBM innovation programmes – used with clients  Repeatable approaches to innovation  Case studies and examples InnovationthatMatters
    3. 3. IBM Global Technology Services – Innovation Team 3 “Today, innovation is about much more than new products. It is about reinventing business processes and building entirely new markets that meet untapped customer needs. Most important, as the Internet and globalization widen the pool of new ideas, it's about selecting and executing the right ideas and bringing them to market in record time.”
    4. 4. IBM Global Technology Services – Innovation Team 4 Reviewing the top-ten hallmarks of innovative companies 1. Active Flow of Ideas 2. Excel in product innovation 3. Developing in services innovation 4. Embrace business model innovation 5. Extensive external collaboration 6. Balanced risk taking and management trust 7. Better integrate business and technology 8. Innovation metrics/incentives and process 9. People take responsibility for implementing their own ideas 10. Leading from the top 80%
    5. 5. IBM Global Technology Services – Innovation Team 5 Different Types of Innovation (scope) Pragmatic / Tactical Strategic Business Infrastructure Technology Process Delivery Innovations Business Model Innovations Process Improvement Infrastructure Innovations Deploy New Architectures New products or solutions for the client COST REDUCTION OPPORTUNITIES Commercial InnovationsOperational Innovations Exploit new industry / business opportunities Transformation Activities Legacy Transformation Blue = Opportunity for Revenue Generation
    6. 6. IBM Global Technology Services – Innovation Team 6 CEOs see even more potential with informed and collaborative customers and are rapidly increasing their investment there Investment* past 3 years Investment* next 3 years Rise of the informed and collaborative customer “We must redefine our value proposition to customers. Information and advisory content are becoming even more valuable than traditional drivers.” H. Edward Hanway, Chairman & CEO, CIGNA Corp. “The rise of the informed and knowing consumer will continue to have an impact regarding our go-to-market priorities. We must know how to leverage new media. We've been surprised by the impact that just a few consumers can have with their blog entries.” Rob Hurlbut, CEO, Attune Foods 22% INCREASE 16.7% 20.4% No impact 14% Positive impact 76% Negative impact 10%
    7. 7. IBM Global Technology Services – Innovation Team 7 Sources of New Ideas and Innovation Academia Associations, trade groups, conference boards Competitors Consultants Customers Business partners 0515253545% 45%3515 2550 Internet, blogs, bulletin boards Other R&D (internal) Sales or service units Employees (general population) Think tanks External Internal
    8. 8. IBM Global Technology Services – Innovation Team 9 We have found that clients have a variety of business needs that drive innovation… We want to implement the latest Remote Collaboration tools – but we also need to make sure we can use them well and get the benefits from them… We want to make our processes less costly, more customer focused, more responsive, but that requires innovative behaviours through the whole organisation… We want to exploit the potential for innovation in our workforce, but we need to know how to direct this potential, structure it, encourage, reward it and enable it… We’re a retailer developing an online sales channel for the first time We’re a distributor building a global supply chain We’re a Pharmaceutical company needing to drive both innovation and speed- to-market There are numerous ways businesses choose to innovate … innovation knows no boundaries! Innovation for one client can be business as usual for another
    9. 9. IBM Global Technology Services – Innovation Team 10 …and therefore require a variety of tools and techniques to define and implement ideas Leadership Development for innovation - top-down behaviour modelling Performance Management to incentivise innovation Process & governance design for innovation management External collaboration Processes & online tools Internal cross-silo collaboration Processes & online tools Communities of Practice Processes & online tools Talent management to get the most out of great innovators Coaching for Excellence method, for simplified, customer aligned operations Better Change method, for rapid adaptation Ideas generation events Facilitated online “jamming” Scenario envisioning method, to plan effectively in a complex environment We use a number of tools and techniques internally and with clients Business Model Innovation to streamline/adapt the organisation
    10. 10. IBM Global Technology Services – Innovation Team 11 Innovation Opportunities 3. Underlying Enablers • Building the underlying capabilities that support innovation – across all innovation types 2. Types of Innovation • Broad set of innovation types that require different capabilities, processes and measurements to succeed 1. Innovation Agenda • Leveraging Insight to set the strategic innovation agenda • Leading and managing the innovation mix
    11. 11. IBM Global Technology Services – Innovation Team 12 Benefits of adopting new technology early £ % of companies using the technology ObsoleteStandardAcceptedLeading Edge Pioneer Benefit Cost Technology Maturity £ % of companies using the technology ObsoleteStandardAcceptedLeading Edge Pioneer Benefit Cost Technology Maturity
    12. 12. IBM Global Technology Services – Innovation Team 14 It is important to make time for other people’s ideas … No! I can’t be bothered to see some crazy innovation. We’ve got a battle to fight!
    13. 13. IBM Global Technology Services – Innovation Team 15 Agenda Items  Introduction  Diversity is crucial  IBM innovation programmes – used with clients  Repeatable approaches to innovation  Case studies and examples InnovationthatMatters
    14. 14. IBM Global Technology Services – Innovation Team 16 It’s all about People …
    15. 15. IBM Global Technology Services – Innovation Team 17 17 Get a different perspective Collaboration and Diversity within Teams is important here
    16. 16. IBM Global Technology Services – Innovation Team 18 Demographics and the Digital Divide  81% of the business population age 34 or younger are gamers  56 million are old enough to be employees  7 million are already managers in the current workforce Sources: Merrill Lynch 1999, Beck and Wade, Got Game., Prensky, Digital Game Based Learning The new generation is huge, 90 million people in the US alone. Already there are more of them around than there are baby boomers. Beck and Wade Digital ImmigrantsDigital Natives
    17. 17. IBM Global Technology Services – Innovation Team 19 Virtual World, Real Leaders  "If you want to see what business leadership may look like in three to five years, look at what’s happening in online games." — Byron Reeves, Ph.D., the Paul C. Edwards Professor of Communication at Stanford University and Co-founder of Seriosity, Inc.Online  Online gaming environments creates leaders who are good at: 1. Focusing on getting the problem solved and the associated incentive 2. Juggling multiple real-time sources of information upon which to make decisions 3. Taking into account skills and competencies among co-players
    18. 18. IBM Global Technology Services – Innovation Team 20 Beyond the Organizational chart Source: Cross, R., Parker, A., Prusak, L. & Borgatti, S.P. 2001. Knowing What We Know: Supporting Knowledge Creation and Sharing in Social Networks. OrganizatiSNAl Dynamics 30(2): 100-120. [pdf]  Organization charts are not the best indicator of how work gets done  Senior people are not always central; peripheral people can represent untapped knowledge  Making the network visible makes it actionable and becomes the basis for a collaboration action plan
    19. 19. IBM Global Technology Services – Innovation Team 1/30/201521 SNA enables improvements by making the issues that affect social networks visible  Implement metrics which promote teaming (e.g., sales goals that include combined offerings from each subgroup)  Create new communication forums to keep subgroups in touch with each other (e.g., status calls, e-mail updates, project tracking databases) Improving Social Networks Examples of Possible InterventionsTarget of Intervention  Staff project with people from each subgroup  Distribute decision-making away from single point  Create ways to engage the under utilized, loosely connected people  Improve breadth of awareness across extended team Organizational Level Leadership Level Individual Level • Boundaries create several distinct sub- groups within one network Type of Issue (Examples) • Highly central people are bottlenecks • Expertise of peripheral people is not leveraged  Mentor people who are new to the company or group  Promote interaction with people beyond departmental boundaries • Individuals are overly dependent on one person • People are not reaching out beyond their department
    20. 20. IBM Global Technology Services – Innovation Team 22 SNA applies to a broad range of business problems  Promote innovation  Example: An R&D group seeking to improve innovation conducts an SNA to ensure that key expertise inside and outside the group is being effectively leveraged  Enhance productivity  Example: An HR group conducts a SNA as part of a new rapid on-boarding initiative to speed the transformation of new hires into productive employees  Increase efficiency  Example: A client facing team that needs to share information across the geographies to respond rapidly to client needs conducts an SNA to find the information hubs and where information is getting stuck  Example: A senior management team concerned that decisions are not being followed through, conducts an SNA to understand where information and decisions are getting blocked
    21. 21. IBM Global Technology Services – Innovation Team 23 Building Effective Virtual Teams The Challenge…  2 weeks – time it takes to build trust in the electronic comms world  4 times as long to communicate a message electronically vs face-to-face  64% of communication is non verbal. Without visual cues messages can be easily misinterpreted  17 weeks – time lag for culturally diverse teams to begin outperforming single-culture teams Ref: Pearn Kandola (Occupational Psychologists) Research Report September 2006
    22. 22. IBM Global Technology Services – Innovation Team 24 Cultural Differentiators  Monochronic/Polycronic  Power Distance  Individualism vs. Collective  Masculine vs. Feminine  Uncertainty Avoidance
    23. 23. IBM Global Technology Services – Innovation Team 25 Agenda Items  Introduction  Diversity is crucial  IBM innovation programmes – used with clients  Repeatable approaches to innovation  Case studies and examples InnovationthatMatters
    24. 24. IBM Global Technology Services – Innovation Team IBM Research worldwide – 3,200 people in 8 labs  5 Nobel Laureates  8 National Medals of Technology  5 National Medals of Science  6 Turing Awards  21 Members in National Academy of Sciences  59 Members in National Academy of Engineering  10 Inductees in National Inventors Hall of Fame Behavioral Sciences Chemistry Computer Science Electrical Engineering Materials Sciences Mathematical Sciences Physics Service & Management Science
    25. 25. IBM Global Technology Services – Innovation Team 27 Huge range of innovation and delivery capabilities IBM Innovation Centres IBM Software Labs IBM Systems & Technology Labs IBM Design Centres IBM Benchmark Centres IBM Innovation Centres for Business Partners IBM Executive Briefing Centres
    26. 26. IBM Global Technology Services – Innovation Team Global Innovation Outlook Introducing the GTO and other tools to understand technology and business trends  Start a dialogue about innovation, business transformation and societal progress  Collaboration across a global ecosystem of experts • Business, academia and political leaders  Publically available at ibm.com/gio Global Technology Outlook  Identify top emerging technology trends & IBM business opportunity in the next 3 to 10 years  Direct influence on IBM’s technical strategy – lists IBM exec actions  Many versions (short / long – internal / external – industry-specific)  Not published externally, but client version available  Fact based thought leadership from IBM Global Services that help clients realize business value  3 to 10 year industry and/or functional area outlook with action oriented next steps  CXO Surveys and joint work with Economist Business Intelligence Unit  Publically available at ibm.com/iibv Institute for Business Value 1970s 1980s 1990s 2000s Centrally Funded Joint Programs Research in the Marketplace Collaborative Innovation • Corporate funded research agenda • Technology transfer • Collaborative team • Shared agenda • Effectiveness • Work on client problems • Create business advantage for clients • Industry-focused research
    27. 27. IBM Global Technology Services – Innovation Team 29 Agenda Items  Introduction  Diversity is crucial  IBM innovation programmes – used with clients  Repeatable approaches to innovation  Case studies and examples InnovationthatMatters
    28. 28. IBM Global Technology Services – Innovation Team 30 One-Off Innovation Activities Ongoing Innovation and Partnership Range of Approaches to Joint Innovation with Clients Limited Commitment (IBM/Client) Standard IBM Offerings Ideas from only one Source Simple Innovation Projects High level of Commitment (IBM/Client) Full program tailored for the client Joint Idea Management Wide portfolio of innovation projects Joint Innovation Partnership Programme (e.g. VCC / iTeam) Tactical Little partnership Full Partnership Strategic Innovation Facilitation Programme (e.g. DVLA, DEFRA Innovation Consulting and Assistance Innovation Workshops / Events Joint Innovation Council with Client Specific Innovation Delivery Projects Various progression paths possible High level of partnership with delivery commitment Strong partnership but no delivery commitments Small / Large projects but no program Mainly thought leadership One off Advice / Consultancy Sponsorship, but no delivery commitment
    29. 29. IBM Global Technology Services – Innovation Team 31 Innovation ideas, input and delivery from an extensive range of internal and external sources Client CIO & GIS communities Client idea management Client Alliances and Partnerships IBM Global Innovation Outlook & Global Technology Outlook Client business and technical teams Client IDEATION and Innovation JAM IBM Client Account Team IBM VCC Briefings Client Technology Vendors IBM Extreme Blue Programme IBM Research Centres INNOVATION DISCOVERY INNOVATION DISCOVERY Joint Innovation Discovery / Theme Workshops IBM Institute for Business Value VCC VCC Research Advocate
    30. 30. IBM Global Technology Services – Innovation Team 32 Innovation Sourcing – Putting Ideas into Action (rapidly)
    31. 31. IBM Global Technology Services – Innovation Team 33 Key Areas of the Blueprint Document  Mission  Guiding Principles  Scope  People – Roles and Responsibilities  Process  Tools  The Innovation Agenda and Initiative Selection  Governance  Funding Model  Communication Plan
    32. 32. IBM Global Technology Services – Innovation Team 34 VCC Critical Success Factors  Working as a Joint IBM / Client Team  Effective / Staffed Core Team  IBM, IT & Business Unit Involvement  Client buy-in to the selected focus areas  Working with the Strategy & Architecture Teams  Selecting the right ideas  Appropriate Risk from an IBM and Client Perspective  Strategic for IBM & Client  Valuable from a Client IT or Business perspective  Able to implement quickly – need some quick wins  Having an effective governance and decision making process in place  Clear sponsorship for the specific initiatives to be progressed  Setting the right expectations for the VCC  Communicating the VCC vision, scope and activities “Between the conception And the creation, Between the emotion And the response, Falls the Shadow” (T S Eliot)
    33. 33. IBM Global Technology Services – Innovation Team 35 Agenda Items  Introduction  Diversity is crucial  IBM innovation programmes – used with clients  Repeatable approaches to innovation  Case studies and examples InnovationthatMatters
    34. 34. 36 “SMS for Life”
    35. 35. 37 • Over 1m people die of malaria in sub-Saharan Africa each year – About 2.7m per year globally • Tanzania has the highest death rate in all of sub-Saharan Africa – Around 380 per day – 80% of these are children under 5 • Anecdotally, 40% of health facilities are thought to be out of stock of anti-malaria drugs at any one time “SMS for Life” … The Problem …
    36. 36. 38 Solution Overview • Process flow documented on the poster provided to each of the health facilities • Application provided by Matssoft under contract to Vodafone – UK company – Application hitherto used to manage insurance quote workflows • Vodafone manages Telco requirements – Vodacom Tanzania – PUSH, the local aggregator – And also the technical incident management process • IBM provides project management
    37. 37. IBM Global Technology Services – Innovation Team 39 Agenda Items  Introduction  Diversity is crucial  IBM innovation programmes – used with clients  Repeatable approaches to innovation  Case studies and examples InnovationthatMatters
    38. 38. IBM Global Technology Services – Innovation Team 40 40 Fortune favours the brave !! Do one brave thing today … then run like hell !

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