Britain’s capacity to excel in research and development has continued to be at the heart of our economic growth and today we are still one of the world’s leading innovators. As we slowly start to climb out of the recession, growth prospects remain at the mercy of continued budget constraints combined with a growing IT skills shortage. Thinking about our legacy as a powerhouse of discovery and invention, it is clear to me that the only way that we can get out of today’s economic malaise is by continuing to invest in sustainable innovation. However, where IT is concerned, I think that’s easier said than done.
But before we talk about innovation, I need to stress that innovation doesn’t need to be ‘big bang’, radical change or an amazing new invention. Innovation is simply a new way of doing something. Whether a new feature, a new service or a new process, innovation is often about incremental progress, which enables the business to work more effectively and efficiently.
According to CIO magazine, business process improvements and increasing IT capacity to drive innovation is top of the list of most frequently cited IT management priorities. However, according to IT Wire.com, over 25 per cent of all CIOs also list innovation and technological change as one of the biggest challenges facing them in 2013.
So why does IT struggle to innovate? Or to put it another way, why does the business perceive that IT can’t innovate? I believe there are two mitigating factors. The first is that according to Gartner, at least 80 per cent of the IT budget is still spent on Keeping The Lights On (KTLO). So if the total spend on enterprise-wide IT is likely to be £1.59tn (as cited in a recent New York Times article), and 80 per cent of this spend is allocated to what is essentially maintenance, you get the picture in terms of how much KTLO costs.
The second factor impacting IT’s ability to innovate is around the accumulation of new service or change requests made by business units, which puts a massive strain on IT resource. This creates an inevitable backlog which can result in a failure to deliver. IT departments are then often seen to be incompetent, slow, and by default unable to support innovation. The real failure here, however, is actually a lack of budget and resource, not incompetence or an inability to innovate.
The reality is that any business faced with the critical need for new applications and an IT department unable to respond will find a way to solve the problem by either building their own application, renting cloud based solutions that don’t need IT’s involvement, or hiring an IT consultancy to help them build the application. However, this doesn’t address the problem. In fact, for most companies it makes the problem worse. Technology debt grows and backlogs get bigger. Unable to react, IT inevitably gets left behind and becomes an unsustainable business model. IT departments are then rendered as ineffective and irrelevant, relegated to being a cost centre unable to help the company innovate.
Organisations continue to walk down this path and expect to arrive somewhere different. This has to change; IT has the ability to innovate in so many ways, if only given the chance.
Zahid Jiwa is VP UK&I of OutSystems.
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