My last couple of posts have been on ITIL, where I presented my argument that approaches such as this (and CMMI) are necessary but not sufficient to take Business-IT Maturity to the next level. They are necessary because they help build a solid foundation for IT operations and services. They are insufficient because they typically don’t lead the the kind of breakthroughs in IT performance that most enterprises need, and in turn, they don’t position most IT organizations for the kinds of business innovation that IT is capable of enabling.
I will draw upon some of the early work of the quality movement – Joseph Juran and Edwards Deming in particular. (My apologies for not being able to provide more precise references – I just don’t have them handy at the moment.)
First, at the risk of stating the obvious, continuous improvement (TQM, Six sigma, etc.) is mostly about taking a process (or product) and improving its performance. It is a mostly incremental approach (though the increments can be quite significant if the process was way out of control). Innovation (what Juran referred to as ‘breakthrough’) is a much more radical approach.
Today, when we innovate a process, we often call it re-engineering. It is, by definition, not incremental, and performance gains can be orders of magnitude. Juran proposed a cycle of improvement and breakthrough as indicated on the chart above – improve it until the marginal effort is no longer justified by the marginal performance gain, or until a new technology or method promises significant gains from a new way of doing things. Once the innovation (innovated product or re-engineered process) has be introduced, shift back to continuous improvement methods to stabilize and incrementally improve the new product or process.
This improve/innovate cycle can be applied to products (or services) and processes. IT organizations need to develop strong competencies in all four quadrants of the figure below – both as these apply to IT processes and products (or services) and to business processes and products (or services).
The competencies, management styles, methods, and organizational approaches to improvement versus innovation are quite different. As the IT industry moves from Web 1.0 to Web 2.0, from ERP to Software as a Service, from process improvement and integration to collaboration, process and product innovation, methods such as ITIL and CMMI are “table stakes” for playing in the business innovation space with significantly higher business value.
Filed under: IT Maturity, Key Frameworks, Next Generation IT, Web 2.0 | Tagged: CMMI, innovation, ITIL, Process re-engineering
