Strategies Towards Innovation

The current tide of global economics has placed considerable pressure on businesses to cut costs and perform more efficiently.  This situation isn’t more apparent than in IT concerns of the business, where the focus has been shifted to strategic leadership.  Several companies have reported that their CIOs are now reporting directly to the CEO, instead of the COO or CFO, indicating the executive focus on the IT strategy.

The pressure to save costs are encouraging companies to invest into innovative technologies to streamline processes, replace expensive IT, and find better ways to provide the same, if not better services than before.  According to a 2008 online survey by TechWeb (http://www.transformationenablers.com/research/state-of-business2.jhtml;jsessionid=X0NUAY5LITVUGQSNDLPSKHSCJUNN2JVN), nearly a quarter of the companies interviewed are  allocating 16-35% of the IT budget to supporting innovation.  Over three-fourths of the companies expected an increase in their budgets for innovation change.  The top four areas for this money are business process management (BPM), promoting collaboration, customer relationship management (CRM) and project management.

The push for outsourcing support for it or business processes is one of the key strategies for many companies to handle the economic pressure.  Most pursuing this route are doing it to save money, while  large contingencies are moving to external providers to free up personnel for internal innovation of the companies’ product line or as a way to optimize the processes of the business.

The bottom line to business has been communicated.  Save the cost of doing business or expected harder times.