Driving IT innovation abroad

As you read this, I’ll be winging my way to Prague, where I’m helping facilitate a two-day CIO round table on IT in emerging markets. Don’t worry — it’s not a boondoggle. Just an out-and-back trip (flying coach) — and I’ll probably be too jet-lagged to enjoy the beer.

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I’ve already learned a big lesson, however, from this project: I’m the quintessential “ugly American.” During a prep call, I repeatedly referred to “Czechoslovakia,” which in 1993 was split into the Czech Republic and Slovakia. I could almost hear the people on the call groaning at my geo-ignorance and insensitivity. Don’t let this happen to you!

As my geo-penance, I’ve chosen to do a deep dive this week on IT in a single European country, Italy — not an emerging market, given that it emerged way before we did. As it turns out, Forrester Research just published a report: “How Italian CIOs Can Drive Business Innovation,” based on a one-day CIO conference in Milan that HP Italy and the Politecnico di Milano School of Management co-managed. The conference included IT execs from some of Italy’s top companies, including Barilla, Enel, Ferrero, Fiat, and Telecom Italia.

The Forrester study begs the question of whether Italian IT is really any different than IT anywhere else. But to avoid U.S.-centricity, let’s pretend it is.

The study’s key finding was that because Italian business leaders don’t value disruptive innovation very much, Italian CIOs are stuck in an incremental process innovation mode that’s hard to break out of. Whereas 71 percent of the CIOs reported that their CEOs highly valued incremental improvements to existing processes (b-to-c or b-to-b), only about 40 percent reported their CEOs saw investments in new business models as strategically relevant.

As point of comparison, Forrester notes that 47 percent of U.S. CEOs value business model innovation highly, as do 56 percent of Asia Pacific CEOs and 52 percent of European CEOs overall.

The problem for Italian CIOs is that you can’t think outside the box if your bosses don’t care what’s outside the box. And as Forrester pointed out, although incremental improvements are good, they can be “easily rendered irrelevant and obsolete by nimble competitors wielding a disruptive new business model” — especially in rapidly changing industries, such as financial services, telecom, and media.

“Italian CIOs should help their business peers gain a broader perspective of business innovation,” Forrester suggests. And they must “recast their unique assets and capabilities — business process knowledge, problem solving creativity, and technology awareness — to drive a broad spectrum of business innovations that extend beyond incremental process improvements.”

Forrester suggests that Italian CIOs try to focus more on contributing to product (vs. process) innovations, and that they try to “raise the business IQ” of IT staffers by rotating IT talent into the business. It also advised CIOs to build their own “innovation networks,” pulling ideas and advances from their best software vendors and consultants. And finally, it recommended viewing wireless applications and new IT architectures as innovation enablers rather than process-improvement enablers.

Whether the Italian CIOs can pull this off, I don’t know. But if they do, we can all plan one heck of a field research trip to learn more about best practices in disruptive innovation.