Four Keys to Strategic AgilityBy Christine Crandell | Posted 2011-03-30 Print
With product innovation and differentiation critical to business success, IT should have a larger role in innovation strategy across the enterprise.
The first practice eliminates the periodic forecast schedule. Instead, it keeps forecasts current based on market, customer, economic, competitive and regulatory data continuously acquired from internal and external sources.
The second improves visibility of information throughout the enterprise, including strategic objectives, program status, forecasts, plans, requirements, resource allocations and decisions.
Third, synchronize operations and priorities— both vertically, between executive and lines of business, and horizontally, among all functional organizations. Synchronization ensures that strategic objectives automatically cascade down the organization and link to team and individual objectives. Conversely, the impacts and gaps resulting from decentralized decision making automatically flow upward to middle and senior managers.
Fourth, manage all product initiatives in the aggregate in order to understand each initiative’s contribution to the overall strategy and to balance investment. With aggregation, managers waste fewer resources and keep the pipeline filled with profitable initiatives.
This is the essence of strategic agility.
The capacity to see innovation initiatives as pieces on a chessboard guided by an adaptive strategy requires new technology. Why? Because not one of today’s enterprise IT systems —ERP, PLM, CRM, SCM, etc. — addresses the holistic imperative of keeping executive and functional organizations continuously aligned.
More than any other enterprise entity, IT comprehends the data, process and automation needs of each functional organization. Innovation management in general (and strategic agility in specific) requires technology that makes data instantly and globally accessible, supports dynamic relationships among those data, and provides analytics, dashboards, decision support and communication services that span the enterprise.
Within that context, here are just a few of the areas where IT can assume a leading role in implementing strategic agility.
Define the requirements and access policies for a global repository that houses market and economic data, resource capacity, business assumptions, plans, product requirements, schedules and resources.
Define standards, methods and interfaces for acquiring real-time market data, communicating with external stakeholders, and capturing data typically stored in firewalled data repositories and static formats such as notebooks, spreadsheets, presentations.
Define the traceability and auditing policies to ensure that changes in data, strategy, priorities and resources remain consistent throughout the enterprise.
Work with IT software vendors to ensure that available technology supports the needs of strategic agility.
Finally, IT’s role in servicing a broad customer base with many voices presents an opportunity for companies looking to improve idea management. IT can use this expertise to create processes and practices for analyzing, selecting and prioritizing ideas gathered from internal and external sources.
Companies that adopt strategic agility can markedly improve their performance, as measured by deeper market penetration, higher ROI, lower R&D costs, a higher percentage of revenue from new products, stronger margins and consistent growth patterns. In Predicts 2011: Pattern-Based Strategy Technologies and Business Practices Gain Momentum, Gartner reports that companies employing data-driven, predictive decision-making outperform their peers by as much as 25 percent across many of these metrics.
The opportunity is tremendous. The rewards are clear. But strategic agility requires that executives embrace change. And acknowledge that it can only be done by shining the spotlight on IT.
Christine Crandell is senior vice president of marketing for Accept Corporation, a maker of software to help companies manage innovation, product development, and strategic product alignment.
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