US Lags in IT Innovation, Survey Says
September 26, 2012
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The US is behind other nations when it comes to encouraging and rewarding IT innovation, according to a CA Technologies survey.

The global study Why IT Needs to Lead Now: The Innovation Imperative demonstrates the urgent need for many IT organizations to transition from an ad hoc approach to innovation to a more mature, structured method to deliver higher-quality business services faster.

According to the large organizations surveyed, only 28 percent of US respondents said innovation is frequently or widely practiced, compared to 58 percent of European and 45 percent of Asian respondents.

And while 63 percent of worldwide respondents have formal processes to measure innovation success, it is largely ad hoc or nonexistent in the US, with 26 percent of US respondents reporting there is no measurement process in place.

US-based organizations are also facing different obstacles than their international counterparts. When asked about key obstacles to innovation, the US is significantly more likely to cite budget issues (47 percent versus 28 percent in Europe, and 24 percent in Asia Pacific (AP)); information overload/too entrenched in repetitive tasks (43 percent versus 29 percent in Europe and 18 percent in AP); and, lack of an incentive/rewards structure (26 percent versus 19 percent in Europe and AP).

More budget dollars are also spent on maintenance and “keeping the lights on” in the US compared to overseas respondents (73 percent of US versus 63 percent for Europe and 61 percent for AP), limiting the available budget dollars for new projects.

Additionally, US organizations embrace and leverage “technology disruption” far less frequently than their counterparts. Only 17 percent of US respondents indicated that technology disruption projects frequently occur, versus 30 percent and 38 percent for their European and Asian counterparts, respectively.

“In addition to these troubling gaps, the research also tells us that innovation is a critical driver to success given today’s economic pressures, 24x7 connectivity, global market access, lower barriers to entry for competitors, and new expectations from tech-savvy consumers, all of which create unprecedented demands on today’s IT leaders,” said Andi Mann, vice president, Strategic Solutions at CA Technologies.

“Not prioritizing, fostering and rewarding innovation can have dire consequences. It makes organizations less competitive, unable to attract new customers and therefore, less relevant in the market, and it hurts the bottom line.”

Mann continued, “By responding to this ‘Innovation Imperative,’ IT leaders can deliver new business services faster and more efficiently. They are in prime position to lead innovation efforts in their organizations by exploiting the convergence of disruptive technologies such as social, mobile, cloud, virtualization and big data to support their business-centric strategies with innovative services or solutions.”

Additional key findings include:

• When asked about the possible outcomes related to a lack of investment in innovation, the top responses across business and IT included an inability to attract new customers/markets (37 percent), increased competitive pressure (32 percent) and revenue loss (31 percent).

• Looking at outcomes they have achieved or expect to achieve from innovation, the majority of respondents cited higher customer satisfaction (86 percent) and increased speed to market (79 percent). Other benefits include the ability to enter new markets (82 percent), increased profit (85 percent) and revenue/market share (83 percent), and the identification of growth opportunities (81 percent).

• Innovative organizations are more likely than their less innovative peers to emphasize experimentation and exploration; however, they place even more emphasis on meeting or anticipating customer needs, analysis and exploiting existing knowledge. Counter to conventional thinking, they also place more emphasis on planning and structure, indicating that they take a more mature approach to how innovation projects are managed and measured.

• Areas of planned technology investment related to innovation over the next 12 months include mobile, cloud, security, business analytics, service management, virtualization and automation.

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