The need for constant self-assessment and development is not news. It is a simple fact that organisations have to innovate to survive.
There has never been as much pressure for organisations to drive this process, and get it right quickly. We live in a world where the consumer is better informed and has more choice than ever before. The capacity to evolve quickly has never been as important.
Organisations must be careful to not fall into the trap of pushing innovation for innovation's sake. Senior executives must ensure they are driving intelligent innovation and it is critical that the success or value of a new idea is judged on the impact that it will have on the bottom line and company goals.
Innovation must be a process that involves the entire value chain and which uses clear performance indicators to steer decision-making in the right strategic direction. Businesses need a clear idea of what they want to achieve when they consider investing valuable resources in developing new ideas. Intelligent decisions about the future can only be made based on intelligence about their business - what are customers demanding? What are our competitors doing? An organisation will also need to ask - how much money can we invest in this? Is there a specific deadline on this for success? In what way do they want this to support the overall business strategy and goals?
Immediately available, accurate information underpins the process of innovation. The only way for senior executives to be 100 per cent sure their decisions are based on fact, rather than supposition, is through effective and thorough information management. Past intelligence about the business, current knowledge of trends and the market place and an understanding of future company goals must be used to guide evolution.
A good example of where knowledge is key to fast innovation is in Formula One. Car designers and manufacturers on the circuit work under continuous and intense pressure to design and race the fastest car.
Established in 1977 as Williams Grand Prix Engineering, WilliamsF1 has won sixteen World Championships and is one of one of the sport's most successful teams, having achieved over 100 race victories. As with any design project, budget limitations mean that careful consideration is vital when deciding on which areas of car design and testing to focus on, in order to generate the best results.
WilliamsF1 uses an activity-based costing model to set budgets and allocate spending for the different areas of car design and testing in order to make the most efficient investments. It uses IBM Cognos performance management technology to enable the team to make better decisions, based on more accurate data. This solution links Business Intelligence, Enterprise Planning and Scorecarding, allowing all capabilities be accessed from one single platform.
IBM Cognos Planning has been designed to help companies build the foundations for improved performance and planning across their business. It provides users with a standard platform from which to forecast future performance and avoid surprises by predicting the outcome of multiple hypothetical scenarios.
The WilliamsF1 team uses IBM Cognos Planning, which provides a framework for budget allocation that can be presented by senior management to team decision-makers and the engineers who are focused on car development options. This helps them decide on which activity to invest in to get the most out of design and testing, and therefore achieve its ultimate goal of having the fastest car on the racetrack.
This ensures that realistic and focused discussions on car design, within the budget available, can take place without the influence of other manufacturers.
In addition, the ‘what if?' analysis function within IBM Cognos Planning means WilliamsF1 is able to test different scenarios and the financial implications of each one in order to make the best investment decisions. For example, deciding whether predictive modelling or on-track experimentation will be most beneficial to car design developments given the budget available.
The most successful organisations are those able to continually evaluate and transform routine business activities into "next practices" that help cut costs, minimise risk, streamline processes, boost productivity, enable rapid response to emerging opportunity, and increase management visibility throughout the enterprise. But, while sensible in theory, the reality of changing the status quo is not easy. At Cognos, an IBM Company we have recognised that this is difficult, so we have established the Innovation Center for customers.
The Innovation Center is a consortium of industry leaders, practitioners, thought leaders, forward-looking executives, and technology experts who are committed to the advancement and successful application of technology-enabled performance management best practices. Its aim is to help organisations align their plans, processes, and resources, including research and development, with corporate goals and strategies.
When supporting new processes, technology will obviously play a major part. Organisations must speak to suppliers that practise what they preach, and spend time and money on research and development, so they will always be ahead of the game.
One major outcome from discussions at the Innovation Centre has been the development of Performance Blueprints. The Blueprints are pre-defined data, process, and policy models, which have been designed by Cognos, based on the expertise within the Innovation Centre. These Blueprints allow companies to implement these processes quickly and efficiently, easing deployment and speeding up return on investment for organisations.
In conclusion, the need to continuously come up with new ideas and adapt to changing situations is critical for not only business success, but for survival. And intelligent innovation is not something companies can do on an ad hoc basis, but must become part of the culture. Ideas, based on experience, knowledge of the organisation's goals and intelligence of future trends must underlie all product design, new services and management processes. Only when this approach becomes part of the culture, will new ideas and change deliver real economic benefit.
For more information visit www.cognos.com
