From Deloitte Weekly Report| Technologies

1. The CIO’s Role in
Business Innovation:
Sustain or Disrupt?
Deloitte Debates
Should CIOs focus on sustaining innovation, using emerging technologies to improve business efficiency and
effectiveness? Or should they lead the charge to apply technology in ways that disrupt business as usual?
We’re at an unusual time in industry: five major forces affecting businesses are all technology-based. These forces –
mobility, analytics, social, cloud computing and cyber intelligence – are being combined in new ways, opening the
door for sustaining innovations that can improve productivity and drive down costs. These forces can also be used to
disrupt “business as usual” to create totally new ways of generating value. So where should CIOs focus their energy and
resources?
Here's the debate:
CIOs should sustain the business.
Efficiency, effectiveness and regulatory mastery are even
more important now. CIOs should focus on sustaining
innovations that address today’s growing concerns.
CIOs should lead disruption.
Social computing, mobility and the cloud aren’t just
changing society, they’re disrupting business. Who’s
better positioned to help take advantage of these tools
than the CIO?
Technology is the fuel, not the driver.
Technology enables innovation, but the business should
be doing the driving. The CIO should respond to the
needs of the business, not the other way around.
Technology can break constraints. That’s where
innovation happens.
The CIO is in a rare position to lead the creation
of disruptive business models given technology’s
prominence across business.
Immediate returns come from driving down costs.
IT is the largest capital expenditure in many companies.
Keeping up with technology’s declining cost curve is a
full-time job with a high return on investment.
You can’t shrink your way to greatness.
It’s worth the deliberate sacrifice of some efficiency
gains to achieve the potential long-term advantages
offered by disruptive innovations.

2. Deloitte Debate 2
Chasing disruption is a crapshoot.
Better to focus on incremental improvements that are
more likely to pay off than risk limited resources on a
long shot.
The odds are better than you think.
Disruptive innovation is just as likely to pay off as
sustaining efforts when pursued deliberately and
consistently, with a strategy and operational metrics
tuned to its specific needs.
My take
Michael E. Raynor
Director
Deloitte Consulting LLP
Over the last 20 years, great strides have been made in getting CIOs a seat at the strategy table. Next stop? Bringing CIOs
into innovation conversations. But should they lead that discussion?
For many businesses, the IT infrastructure is the enabling technology that provides opportunities to innovate and break
constraints – which is at the core of disrupting business as usual for competitive advantage. It makes sense that CIOs
should be at the forefront.
But is it worth trading short-term efficiency for possible long-term advantage? This is where disruption theory has merit.
It’s very hard to make this tradeoff when you’re told that innovation is fundamentally unpredictable. You have to be
willing to fail. You have to embrace many false starts and few are willing to take such risks. Many CIOs are satisfied with
keeping up with the art of the possible.
The good news is that disruption theory shows that game-changing innovation is more predictable than many think. So
it’s wise to evaluate the potential returns from disruptive innovations as well as sustaining ones.
Of course, even CIOs who have earned their stripes through sound IT stewardship should take stock before stepping into
the realm of innovation. The same processes, approaches and frameworks that made them successful in the past will likely
be insufficient in this new world. But those who are able to adopt the mindset and tools necessary to shake up business
models, while still effectively running the business of IT, are in a rare position to guide innovation investments that could
lead to business breakthroughs.

3. Related Content
Library: Deloitte Debates
Services: Consulting
Overview: Technology
Related links:
Measured innovation – The culture, disciplines and mechanics for institutionalizing innovation
Join us for the Dbriefs webcast.
Tech Trends 2012: Measured innovation
Learn how to elevate IT for digital business.
Deloitte On Technology
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