The US and the UK are sitting at the bottom of international rankings when it comes to investing in innovative IT projects.
Against a global average of 20 percent of IT spend going on IT innovations, the US figure is 14 per cent and the UK’s 18 per cent, according to a report by CA Technologies.
“[The research] puts the UK in a worse position than everybody other than the US when it comes to how much money, time and effort are spent on innovation in IT,” said CA’s UK CTO Colin Bannister.
“It highlights that 80 per cent of budget is being spent on average on keeping the lights on versus business change and innovation,” he said.
“There are some positives in there but there are a whole bunch of challenges that we need to address as an industry.”
IT’s fundamental role
According to Bannister, the report shows every organisation recognises that IT is fundamental to innovation initiatives and growth strategies, virtually irrespective of sector.
“The less positive news is about IT’s role as being the instigator of innovation. There’s a gap in perception there. There’s equally a gap in perception about IT’s receptiveness to new ideas from the business,” Bannister said.
The survey polled senior IT and business executives from large originations in the US, UK, Brazil, France, Germany, Australia, Singapore and Japan.
Bannister said the research showed that organisations that are perceived as innovative have a structured process through which they drive innovation, which he defines as, “A good idea with a defined business outcome”.
“Organisations that have a structure for dealing with innovation are more successful or get bigger benefits. I view that structure as a funnel. So, how do you capture good ideas in the first place, because your good ideas can come from your customers, your employees, your business partners,” he said.
“Once you’ve captured those ideas, how do you prioritise them and how do you do your investment prioritisation? How do you assign resources to those projects and programmes of work? Then the final bit is how do you do your benefits realisation? How do you go back and say, ‘Did we get the benefits we thought we’d get from that idea?’, Bannister said.
He believes that the biggest inhibitor to innovation is lack of budget and the present pervasive climate of austerity.
“The research would indicate 20 per cent of organisations are not doing any innovation at all of any note, which is really quite worrying. We have to come up with new ideas to grow our businesses,” he said.
Second big inhibitor to innovation
The second big inhibitor is a lack of time and Bannister said he believes that to innovate, you may actually have to stop doing something.
“One of my favourite questions for CIOs when I meet them is, ‘So how do you make the decision about what you should stop doing?’,” he said.
The emerging countries are the ones that are doing innovation well, according to Bannister. The innovation spend figure for Brazil is 29 per cent of IT budget.
“Brazil is the shining light in terms of innovation. That’s the threat. We’ll be outgunned by the emerging nations if we’re not careful and if we don’t address the issues.”