1. 1
Delivering Successful Innovation depends on
Diversity
CIFS, Copenhagen
27th October, 2010
Tina Easton
tina@uk.ibm.comInnovationthatMatters

2. IBM Global Technology Services – Innovation Team
2
Agenda Items
 Introduction
 Diversity is crucial
 IBM innovation programmes – used with clients
 Repeatable approaches to innovation
 Case studies and examples
InnovationthatMatters

3. IBM Global Technology Services – Innovation Team
3
“Today, innovation is about
much more than new products.
It is about reinventing business
processes and building entirely
new markets that meet
untapped customer needs.
Most important, as the Internet
and globalization widen the
pool of new ideas, it's about
selecting and executing the
right ideas and bringing them
to market in record time.”

4. IBM Global Technology Services – Innovation Team
4
Reviewing the top-ten hallmarks of innovative companies
1. Active Flow of Ideas
2. Excel in product innovation
3. Developing in services innovation
4. Embrace business model innovation
5. Extensive external collaboration
6. Balanced risk taking and management trust
7. Better integrate business and technology
8. Innovation metrics/incentives and process
9. People take responsibility for implementing
their own ideas
10. Leading from the top
80%

5. IBM Global Technology Services – Innovation Team
5
Different Types of Innovation (scope)
Pragmatic / Tactical Strategic
Business
Infrastructure
Technology
Process
Delivery
Innovations
Business Model
Innovations
Process Improvement
Infrastructure
Innovations
Deploy
New Architectures
New products or
solutions for the client
COST REDUCTION OPPORTUNITIES
Commercial
InnovationsOperational
Innovations
Exploit new industry /
business opportunities
Transformation
Activities
Legacy
Transformation
Blue = Opportunity for Revenue Generation

6. IBM Global Technology Services – Innovation Team
6
CEOs see even more potential with informed and collaborative
customers and are rapidly increasing their investment there
Investment* past 3
years
Investment* next 3
years
Rise of the informed and collaborative customer
“We must redefine our value proposition to
customers. Information and advisory content
are becoming even more valuable than
traditional drivers.”
H. Edward Hanway, Chairman & CEO, CIGNA Corp.
“The rise of the informed and knowing consumer will
continue to have an impact regarding our go-to-market
priorities. We must know how to leverage new media.
We've been surprised by the impact that just a few
consumers can have with their blog entries.”
Rob Hurlbut, CEO, Attune Foods
22%
INCREASE
16.7%
20.4%
No
impact
14%
Positive
impact
76%
Negative
impact
10%

7. IBM Global Technology Services – Innovation Team
7
Sources of New Ideas and Innovation
Academia
Associations,
trade groups,
conference boards
Competitors
Consultants
Customers
Business partners
0515253545% 45%3515 2550
Internet, blogs,
bulletin boards
Other
R&D (internal)
Sales or service units
Employees
(general population)
Think tanks
External Internal

8. IBM Global Technology Services – Innovation Team
9
We have found that clients have a variety of
business needs that drive innovation…
We want to implement the latest
Remote Collaboration tools –
but we also need to make sure
we can use them well and get
the benefits from them…
We want to make our processes
less costly, more customer
focused, more responsive, but
that requires innovative
behaviours through the whole
organisation…
We want to exploit the
potential for innovation
in our workforce, but
we need to know how
to direct this potential,
structure it,
encourage, reward it
and enable it…
We’re a retailer
developing an online sales
channel for the first time
We’re a distributor building
a global supply chain
We’re a Pharmaceutical
company needing to drive
both innovation and speed-
to-market
There are numerous
ways businesses choose
to innovate
… innovation knows no boundaries! Innovation for one
client can be business as usual for another

9. IBM Global Technology Services – Innovation Team
10
…and therefore require a variety of tools and
techniques to define and implement ideas
Leadership Development
for innovation - top-down
behaviour modelling
Performance
Management
to incentivise
innovation
Process &
governance design
for innovation
management
External collaboration
Processes & online tools
Internal cross-silo collaboration
Processes & online tools
Communities of Practice
Processes & online tools
Talent management
to get the most out of
great innovators
Coaching for
Excellence method, for
simplified, customer
aligned operations
Better Change method,
for rapid adaptation
Ideas generation events
Facilitated online
“jamming”
Scenario envisioning
method, to plan
effectively in a complex
environment
We use a number of tools
and techniques internally
and with clients
Business Model
Innovation to
streamline/adapt
the organisation

10. IBM Global Technology Services – Innovation Team
11
Innovation Opportunities
3. Underlying Enablers
• Building the underlying
capabilities that support
innovation – across all
innovation types
2. Types of Innovation
• Broad set of innovation types
that require different
capabilities, processes and
measurements to succeed
1. Innovation Agenda
• Leveraging Insight to set the
strategic innovation agenda
• Leading and managing the
innovation mix

11. IBM Global Technology Services – Innovation Team
12
Benefits of adopting new technology early
£
% of
companies
using the
technology
ObsoleteStandardAcceptedLeading
Edge
Pioneer
Benefit
Cost
Technology Maturity
£
% of
companies
using the
technology
ObsoleteStandardAcceptedLeading
Edge
Pioneer
Benefit
Cost
Technology Maturity

12. IBM Global Technology Services – Innovation Team
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It is important to make time for other people’s ideas …
No! I can’t be
bothered to see
some crazy
innovation.
We’ve got a
battle to fight!

13. IBM Global Technology Services – Innovation Team
15
Agenda Items
 Introduction
 Diversity is crucial
 IBM innovation programmes – used with clients
 Repeatable approaches to innovation
 Case studies and examples
InnovationthatMatters

14. IBM Global Technology Services – Innovation Team
16
It’s all about People …

15. IBM Global Technology Services – Innovation Team
17 17
Get a different
perspective
Collaboration and
Diversity within Teams
is important here

16. IBM Global Technology Services – Innovation Team
18
Demographics and the Digital Divide
 81% of the business population age 34 or younger are gamers
 56 million are old enough to be employees
 7 million are already managers in the current workforce
Sources: Merrill Lynch 1999, Beck and Wade, Got Game., Prensky, Digital Game Based Learning
The new generation is huge, 90 million people in the US alone.
Already there are more of them around than there are baby
boomers. Beck and Wade
Digital ImmigrantsDigital Natives

17. IBM Global Technology Services – Innovation Team
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Virtual World, Real Leaders
 "If you want to see what business
leadership may look like in three to
five years, look at what’s happening in
online games."
— Byron Reeves, Ph.D., the Paul C. Edwards Professor of
Communication at Stanford University and Co-founder of
Seriosity, Inc.Online
 Online gaming environments creates
leaders who are good at:
1. Focusing on getting the problem solved and
the associated incentive
2. Juggling multiple real-time sources of
information upon which to make decisions
3. Taking into account skills and
competencies among co-players

18. IBM Global Technology Services – Innovation Team
20
Beyond the Organizational chart
Source: Cross, R., Parker, A., Prusak, L. & Borgatti, S.P. 2001. Knowing What We Know: Supporting
Knowledge Creation and Sharing in Social Networks. OrganizatiSNAl Dynamics 30(2): 100-120. [pdf]
 Organization charts are
not the best indicator of
how work gets done
 Senior people are not
always central;
peripheral people can
represent untapped
knowledge
 Making the network
visible makes it
actionable and
becomes the basis for
a collaboration action
plan

19. IBM Global Technology Services – Innovation Team
1/30/201521
SNA enables improvements by making the issues that
affect social networks visible
 Implement metrics which promote teaming (e.g., sales goals
that include combined offerings from each subgroup)
 Create new communication forums to keep subgroups in
touch with each other (e.g., status calls, e-mail updates,
project tracking databases)
Improving Social Networks
Examples of Possible InterventionsTarget of Intervention
 Staff project with people from each subgroup
 Distribute decision-making away from single point
 Create ways to engage the under utilized, loosely connected
people
 Improve breadth of awareness across extended team
Organizational
Level
Leadership Level
Individual Level
• Boundaries create
several distinct sub-
groups within one
network
Type of Issue (Examples)
• Highly central people are
bottlenecks
• Expertise of peripheral
people is not leveraged
 Mentor people who are new to the company or group
 Promote interaction with people beyond departmental
boundaries
• Individuals are overly
dependent on one person
• People are not reaching
out beyond their
department

20. IBM Global Technology Services – Innovation Team
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SNA applies to a broad range of business problems
 Promote innovation
 Example: An R&D group seeking to improve innovation conducts
an SNA to ensure that key expertise inside and outside the group
is being effectively leveraged
 Enhance productivity
 Example: An HR group conducts a SNA as part of a new rapid
on-boarding initiative to speed the transformation of new hires into
productive employees
 Increase efficiency
 Example: A client facing team that needs to share information
across the geographies to respond rapidly to client needs
conducts an SNA to find the information hubs and where
information is getting stuck
 Example: A senior management team concerned that decisions
are not being followed through, conducts an SNA to understand
where information and decisions are getting blocked

21. IBM Global Technology Services – Innovation Team
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Building Effective Virtual Teams
The Challenge…
 2 weeks – time it takes to build trust in the
electronic comms world
 4 times as long to communicate a message
electronically vs face-to-face
 64% of communication is non verbal.
Without visual cues messages can be easily
misinterpreted
 17 weeks – time lag for culturally diverse
teams to begin outperforming single-culture
teams
Ref: Pearn Kandola (Occupational Psychologists)
Research Report September 2006

22. IBM Global Technology Services – Innovation Team
24
Cultural Differentiators
 Monochronic/Polycronic
 Power Distance
 Individualism vs. Collective
 Masculine vs. Feminine
 Uncertainty Avoidance

23. IBM Global Technology Services – Innovation Team
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Agenda Items
 Introduction
 Diversity is crucial
 IBM innovation programmes – used with clients
 Repeatable approaches to innovation
 Case studies and examples
InnovationthatMatters

24. IBM Global Technology Services – Innovation Team
IBM Research worldwide – 3,200 people in 8 labs
 5 Nobel Laureates
 8 National Medals of
Technology
 5 National Medals of Science
 6 Turing Awards
 21 Members in National
Academy of Sciences
 59 Members in National
Academy of Engineering
 10 Inductees in National
Inventors Hall of Fame
Behavioral Sciences Chemistry Computer Science Electrical Engineering
Materials Sciences Mathematical Sciences Physics Service & Management Science

25. IBM Global Technology Services – Innovation Team
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Huge range of innovation and delivery capabilities
IBM Innovation Centres
IBM Software Labs
IBM Systems & Technology Labs
IBM Design Centres
IBM Benchmark Centres
IBM Innovation Centres for Business Partners
IBM Executive Briefing Centres

26. IBM Global Technology Services – Innovation Team
Global Innovation Outlook
Introducing the GTO and other tools to understand
technology and business trends
 Start a dialogue about innovation,
business transformation and
societal progress
 Collaboration across a global
ecosystem of experts
• Business, academia
and political leaders
 Publically available at ibm.com/gio
Global Technology Outlook
 Identify top emerging technology
trends & IBM business opportunity
in the next 3 to 10 years
 Direct influence on IBM’s technical
strategy – lists IBM exec actions
 Many versions (short / long – internal
/ external – industry-specific)
 Not published externally, but client
version available
 Fact based thought leadership from
IBM Global Services that help clients
realize business value
 3 to 10 year industry and/or
functional area outlook with action
oriented next steps
 CXO Surveys and joint work with
Economist Business Intelligence Unit
 Publically available at ibm.com/iibv
Institute for Business Value
1970s 1980s 1990s 2000s
Centrally Funded
Joint Programs
Research in the Marketplace
Collaborative Innovation
• Corporate
funded
research
agenda
• Technology
transfer
• Collaborative
team
• Shared agenda
• Effectiveness
• Work on
client
problems
• Create business
advantage for clients
• Industry-focused
research

27. IBM Global Technology Services – Innovation Team
29
Agenda Items
 Introduction
 Diversity is crucial
 IBM innovation programmes – used with clients
 Repeatable approaches to innovation
 Case studies and examples
InnovationthatMatters

28. IBM Global Technology Services – Innovation Team
30
One-Off Innovation
Activities
Ongoing Innovation
and Partnership
Range of Approaches to Joint Innovation with Clients
Limited Commitment
(IBM/Client)
Standard IBM Offerings
Ideas from only one Source
Simple Innovation Projects
High level of Commitment
(IBM/Client)
Full program tailored for the client
Joint Idea Management
Wide portfolio of innovation projects
Joint Innovation
Partnership Programme
(e.g. VCC / iTeam)
Tactical
Little partnership
Full Partnership
Strategic
Innovation
Facilitation Programme
(e.g. DVLA, DEFRA
Innovation Consulting
and Assistance
Innovation
Workshops / Events
Joint Innovation
Council with Client
Specific Innovation
Delivery Projects
Various progression paths possible
High level of partnership with
delivery commitment
Strong partnership but
no delivery commitments
Small / Large projects but no program
Mainly thought leadership
One off Advice / Consultancy
Sponsorship, but no
delivery commitment

29. IBM Global Technology Services – Innovation Team
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Innovation ideas, input and delivery from an extensive range
of internal and external sources
Client CIO & GIS
communities
Client idea
management
Client Alliances and
Partnerships
IBM Global Innovation
Outlook & Global
Technology Outlook
Client business and
technical teams
Client IDEATION and
Innovation JAM
IBM Client Account
Team
IBM VCC Briefings
Client Technology
Vendors
IBM Extreme Blue
Programme
IBM Research
Centres
INNOVATION
DISCOVERY
INNOVATION
DISCOVERY
Joint Innovation
Discovery / Theme
Workshops
IBM Institute for
Business Value
VCC VCC
Research
Advocate

30. IBM Global Technology Services – Innovation Team
32
Innovation Sourcing – Putting Ideas into Action (rapidly)

31. IBM Global Technology Services – Innovation Team
33
Key Areas of the Blueprint Document
 Mission
 Guiding Principles
 Scope
 People – Roles and Responsibilities
 Process
 Tools
 The Innovation Agenda and Initiative
Selection
 Governance
 Funding Model
 Communication Plan

32. IBM Global Technology Services – Innovation Team
34
VCC Critical Success Factors
 Working as a Joint IBM / Client Team
 Effective / Staffed Core Team
 IBM, IT & Business Unit Involvement
 Client buy-in to the selected focus areas
 Working with the Strategy & Architecture Teams
 Selecting the right ideas
 Appropriate Risk from an IBM and Client Perspective
 Strategic for IBM & Client
 Valuable from a Client IT or Business perspective
 Able to implement quickly – need some quick wins
 Having an effective governance and decision making process in place
 Clear sponsorship for the specific initiatives to be progressed
 Setting the right expectations for the VCC
 Communicating the VCC vision, scope and activities
“Between the conception
And the creation,
Between the emotion
And the response,
Falls the Shadow”
(T S Eliot)

33. IBM Global Technology Services – Innovation Team
35
Agenda Items
 Introduction
 Diversity is crucial
 IBM innovation programmes – used with clients
 Repeatable approaches to innovation
 Case studies and examples
InnovationthatMatters

34. 36
“SMS for Life”

35. 37
• Over 1m people die of malaria in sub-Saharan
Africa each year
– About 2.7m per year globally
• Tanzania has the highest death rate in all of
sub-Saharan Africa
– Around 380 per day
– 80% of these are children under 5
• Anecdotally, 40% of health facilities are thought
to be out of stock of anti-malaria drugs at any
one time
“SMS for Life” … The Problem …

36. 38
Solution
Overview
• Process flow documented on the
poster provided to each of the
health facilities
• Application provided by Matssoft
under contract to Vodafone
– UK company
– Application hitherto used to
manage insurance quote
workflows
• Vodafone manages Telco
requirements
– Vodacom Tanzania
– PUSH, the local aggregator
– And also the technical incident
management process
• IBM provides project
management

37. IBM Global Technology Services – Innovation Team
39
Agenda Items
 Introduction
 Diversity is crucial
 IBM innovation programmes – used with clients
 Repeatable approaches to innovation
 Case studies and examples
InnovationthatMatters

38. IBM Global Technology Services – Innovation Team
40
40
Fortune favours the brave !!
Do one brave thing today … then run like hell !