4 steps to business model innovation

E-Book: 4 Steps to Business Model Innovation2 NO. 36 SAP Center for Business Insight | Brief | Q&A | Case Study | Inquiry | E-Book

There’s a New Type of Innovation: Business ModelsAlthough the scope and risks of business model innovations are greater (think Apple going from device seller to entertainment and software retailer), so are the benefits when they succeed. Business model innovations are more difficult for competitors to copy than products or processes.

IT Has the Opportunity to Lead Business Model ChangeMost business model changes these days are based on IT. But CIOs need to get out of the business of spending all their time running IT before they can change.

Here’s How:


The transformation-focused IT organization:

1 Structure IT as a Transformation Driver

Source: How CIOs Can Become Business Innovators

• Involves stakeholders.Those who are affected remain involved and clear about the business reasons for the initiative.

• Tracks results.The CIO and other project sponsors together define and measure the value of the investment by tracking the business benefits.

• Doesn’t do IT projects.Instead, it carries out business projects that incorporate technology.

• Focuses on business outcomes.Rather than delivering an IT system, the organization provides a set of business benefits that are achieved partly by investing in technology.

• Manages change.Rather than having an IT implementation plan, there is a holistic change management plan that takes into account the accompanying changes to business processes, organizational structure, and the impact on suppliers and customers.

• Hires market-oriented staff.The organization needs IT professionals who know what drives the company’s strategy and their industry so they can exploit technology for the greatest business benefits.

http://www.sap.com/bin/sapcom/downloadasset.how-cios-can-become-business-innovators-pdf.bypassReg.html


Networking is how you learn about state-of-the-art technology and concepts that deserve attention from corporate colleagues – and which lead to new business ideas. Here’s how to do it:

2 Build an Advisory Network

Get out of the officeAttend IT and industry conferences, and take advantage of meetings organized by vendors who present their research and

new products to customers. Join peer group associations in your industry so you can compare notes with other CIOs about business trends and daily IT challenges.

Organize workshops on your business challengesWorkshops can be a great way to fuel your – and your team’s – imagination. But your job is

to execute business strategy, so keep them focused on issues relevant to your business.

Don’t leave meetings to chanceSet up a regular schedule of meetings and phone calls.

Seek out big thinkersSeek out local colleges and universities with strong IT and business programs, and reach out to a cross section of academics in both areas.




3 Establish Your Own Think TankCreating a special team within IT that is dedicated to innovation sends a message to the business leaders: operations will not suffer while the innovation team experiments with new ideas. Here are some ways to increase the chances for success:

• Create a dedicated workspace.The space should be organized and designed to encourage conversation and independent thinking and to facilitate small-group collaborations as well as meetings or workshops with business colleagues or outside experts.

• Meet regularly with business leaders.

Having a regular interdisciplinary forum for discussing innovations in addition to informal, unstructured conversations means that the IT team can learn about business challenges and get regular business feedback on their ideas.

• Partner with outsiders. Paul Stratil, CIO at SAS Automotive, has parlayed relationships with researchers at three universities into business innovations. A partnership with the University of Stuttgart and the University of Siegen led to the development of customized simulation tools that SAS Automotive used to design an optimized manufacturing plant layout for assembling automobile dashboards.




4 Hand Off IT Operations

Source: Q&A: The Key to IT-Enabled Innovation: Think Outside the Business Model

I spend 70% of my time on changing the business – working on new ideas, holding workshops, and developing road maps for doing business in a new way. That includes attention to small changes that enable us to do things better. My managers, on the other hand, spend 70% of their time on operations.”

“

– Werner Schultheis, CIO, Randstad Germany

http://www.sap.com/bin/sapcom/downloadasset.q-a--the-key-to-it-enabled-innovation-think-outside-the-business-model-pdf.bypassReg.html


There’s More

The SAP Center for Business Insight is a program that supports the discovery and development of new research-based thinking to address the challenges of business and technology executives.

To learn more, read How CIOs Can Become Business Innovators , an in-depth report from the SAP Center for Business Insight.



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SAP Center for Business Insight | Brief | Q&A | Case Study | Inquiry | E-Book

NO. 36

4 steps to business model innovation

Technology

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