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The 101 Guide to IT InnovationThe 101 Guide to IT Innovation
Professor Michael Rosemann
Information Systems School
Science and Engineering Faculty
Queensland University of Technology
Brisbane, Australia
How ambitious are you?
The Innovation Ambition MatrixTransformational
Management
ark
ets
/cu
sto
mers
new
Adjacent
Transformational
Innovation
3Nagji, Tuff (2012)
TransactionalManagement
products/processes/assets
mark
ets
/cu
sto
mers
newexisting
existing
Core
Innovation
Adjacent
Innovation
Example
Process design group with vanilla BPM methodology
(Six Sigma, lean)
Developed three distinct services
Improve (10%)Improve (10%)
Change (30%)
Innovate (100%)
Needed to become ‘consciously competent’ to
reliably deliver innovation as a service
4
Agenda
The Drivers of Innovation
Shortfalls of BPM and EA
Four Ways to Innovation
Q&AQ&A
5
InnovationDriven by a Problem
RecommendationsProblem-driven Innovation
Capture and endorse corporate goals (strategic context)
in your Enterprise Architecture (EA)
Identify current and future capability gaps
(capability-based innovation)
Consider customers’ processes and problemsConsider customers’ processes and problems
Involve all stakeholders in problem identification
(design innovation)
InnovationDriven by a Constraint
ConstraintConstraint--driven Innovationdriven InnovationExample Example –– Tesco, South KoreaTesco, South Korea
RecommendationsConstraint-driven Innovation
Increase the context-awareness of your EA
and process models (context-aware BPM)
Describe where and how contextual changes
impact your architecture and processes
Search for constraints offshoreSearch for constraints offshore
(reverse innovation)
RecommendationsOpportunity-driven Innovation
Capture the affordances of these technologies
(e.g., ‘ability to locate’, ‘democratization of information
and processes’ )
Allocate dedicated resources to assess the impact
of emerging technologies on your architecture and of emerging technologies on your architecture and
processes
Design architecture and processes
based on desired capabilities
(e.g., ‘facial recognition in a
super market’)
Agenda
The Drivers of Innovation
Shortfalls of BPM and EA
Four Ways to Innovation
Q&AQ&A
13
BPM and Innovation
Design of innovative scenarios is poorly supported
Ideation relies on brainstorming-like approaches
Reference models show common, not exciting practice
Innovation is often not process managedInnovation is often not process managed
Focus is on transactional, not transformational
capabilities
More reactive than proactive
14
EA and Innovation
Focus on technological assets, not (business)
capabilities
Difficult to judge asset utilization (problem)
Limited capture of environmental context (constraints)Limited capture of environmental context (constraints)
Lack of consideration of emerging
affordances (opportunities)
15
Innovation Latency
BusinessValue
Problem, Constraint, Opportunity emerges
Innovation potentialis noticed
Innovationanalysis is conducted Innovation
is adopted
Value lost
through
innovation
latency
16
DataLatency
AnalysisLatency
ImplementationLatency
Time
Innovation
Latency
is adopted
Inspired by Hackathorn, 2002
latency
Agenda
The Drivers of Innovation
Shortfalls of BPM and EA
Four Ways to Innovation
Q&AQ&A
17
Four Ways to Innovation
Derivebetter practices
Enhance CreateInnovateEnhancecurrent practices
Createnew practices
Utilizepotential practices
Innovate
Four Ways to Innovation
Derivebetter practices
Enhance CreateInnovateEnhancecurrent practices
Createnew practices
Utilizepotential practices
Innovate
Enhance: Exercise
You are in charge for the
process “Visiting tourists
at the Empire State
Building”.
What is your objective?
How do you improve
this process?
Enhance Example
Wait Pay Wait Go Up Enjoy Leave
Enhance – ELIMINATE (1)
Wait Pay Wait Go Up Enjoy Leave
Enhance – RESEQUENCE (7)
Wait Pay Wait Go Up Enjoy Leave
Four Ways to Innovation
Derivebetter practices
Enhance CreateInnovateEnhancecurrent practices
Createnew practices
Utilizepotential practices
Innovate
Process DerivationExample
An Indian software vendor receives 1.6m job applications pa
They intend to hire 22,000 employees
What can they learn from a bank’s mortgage process?
….or the editorial process of a prestigious scientific journal?
Exemplary Derivation Patterns
• Need for selecting applicants for scarce resources
• Pre-approval (mortgage application)
• Long waiting time for customers
• Price-driven customer triage (airline)
• Provision of resource utilisation
26
• Provision of resource utilisation
• Usage-based pricing (car park)
• Dependence on customer input
• Automation and pre-filling (Air France)
• Two-sided market
• Brokering demand and supply (Apple)
Four Ways to Innovation
Derivebetter practices
Enhance CreateInnovateEnhancecurrent practices
Createnew practices
Utilizepotential practices
Innovate
Mobility as a service….
The Utilization Differential
• Assume you drive 15,000 kms in your car per year
• Assume the average speed is 50 kms/hr
• You are driving the car for roughly 300 hours
• There are 8,760 hours in the year
• car utilization = 3.4%
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• car utilization = 3.4%
• If your car were a service, that untapped 96.6%
becomes a source of value
• Commercialization of idle time (revenue)
• Share acquisition, operation, maintenance costs
Henry Chesbrough (2012)
UtilizationSearch for Positive Outliers
Four Ways to Innovation
Derivebetter practices
Enhance CreateInnovateEnhancecurrent practices
Createnew practices
Utilizepotential practices
Innovate
Design Innovation at the‘World’s Greatest Bank’
32
Takeaways
Innovation
Dimension
Innovation
Techniques
Enhancement 15 Improvement Patterns
(see conference web page)
Derivation Derivation Patterns, Case Studies,
Benchmarks, Reference ModelsBenchmarks, Reference Models
Utilization Utilization Patterns (People, Data,
Systems, Resources), Positive
Outliers
Creation Six Hats, (Open) Brainstorming,
Crowdsourcing, Customer-led
Innovation, Creativity Techniques
Michael Rosemann
Information Systems SchoolScience and Engineering FacultyQueensland University of Technology
e [email protected] www.michaelrosemann.comt ismiro