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Leveraging IT Innovation

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Action Points
I. What Are Some Creative Uses of IT? An innovative IT team can spell the difference between a function that produces exciting systems that help the company gain a competitive edge or clunky tools that can actually hinder a company’s progress. Examples of creative solutions are leveraging wireless communications systems for reading utility meters and business analytics for customers. II. The Bottom Line While it is certainly true that the creative, competent application of technology can drive business growth, you must understand your company’s limits before planning innovative technologies. Key areas to explore are: How will they give the company a competitive edge? How long will they last? Will they show an ROI within 12 months? III. Must-Have Approaches Toward Aligning IT Creativity With Company Strategy IT cannot create in a vacuum and, even if that were possible, the resulting products would probably not be of use to the rest of the company. The CTO/CIO must continually involve leaders across the organization in assessing needs, soliciting input, planning projects, and conducting periodic reviews. IV. The Golden Rules for Creating a Culture of Innovation If you look at creative organizations in any industry, you’ll realize that they get their ideas from multiple sources, including customers, consumers, vendors, competitors, trade magazines, and supply-chain partners. But what also sets them apart is that they allow their staffs to try new things — and do not punish for the inevitable failures. V. Essential Take-Aways Not every “good” technology idea is going to work for every company. However, some pitfalls can be avoided if the right questions are asked at the outset of project planning. These include: How will the organization benefit? How much can it afford to spend? Do you have the talent to develop this successfully? How reliable does it need to be?

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in partnership with Aspatore Books

IT leaders from Delta Dental of Illinois, the Grand River Dam Authority, Asurion, and the United States Tennis Association on:

Leveraging IT Innovation: Releasing Business Potential Through the Creative Use of IT
Ross Gosnell Vice President, Information Systems and Technology Delta Dental of Illinois Jim Fraley Director, Information Technology, Grand River Dam Authority Chris Corrado Senior Vice President, Technology Solutions, Asurion Larry Bonfante Chief Information Officer United States Tennis Association (USTA)

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Contents
About the Authors . . . . . . . . . . . . . . . . . . . . p.2 Ross Gosnell. . . . . . . . . . . . . . . . . . . . . . . . . p.3 Jim Fraley . . . . . . . . . . . . . . . . . . . . . . . . . . . p.6 Chris Corrado . . . . . . . . . . . . . . . . . . . . . . . . p.9 Larry Bonfante . . . . . . . . . . . . . . . . . . . . . . p.11 Ideas to Build Upon & Action Points . . . p.14

hen it comes to describing a highly-functional IT department’s best attributes, “creativity” may not necessarily come to mind. Yet, innovating new technologies and applying existing ones in new ways does involve a creative process. However, because these products must also serve a strategic need or goal of the company, the CTO/CIO may feel challenged to motivate his or her staff to innovate while simultaneously assuring company leadership that their key projects are on track. This ExecBlueprint addresses how IT creativity can be leveraged in a way that more effectively serves the business purposes of an organization. Here, using specific examples, four IT leaders discuss how they have collaborated with company leaders in guiding the development of IT strategy as well as how they have fostered a culture of innovation within their own departments. Along the way, they cover two large considerations: Where do great ideas originate? How do you set financial and time limits for the creative process? ■

Copyright 2007 Books24x7®. All rights reserved. Reproduction in whole or part is prohibited without the prior written permission of the publisher. This ExecBlueprints™ document was published as part of a subscription based service. ExecBlueprints, a Referenceware® collection from Books24x7, provides concise, easy to absorb, practical information to help organizations address pressing strategic issues. For more information about ExecBlueprints, please visit www.execblueprints.com.

About the Authors
Ross Gosnell
Vice President, Information Systems and Technology, Delta Dental of Illinois

R

oss Gosnell, who joined the company in 1997, is now responsible for all facets of information systems and technology for Delta Dental of Illinois (DDIL). He oversees not only the operation of these technologies, but also plans the strategic technology direction for the company. Previously, as director of regional operations for Deltanet, he was DDIL’s technology director.

Before joining DDIL, Mr. Gosnell was the systems vice president for North American Systems from 1996 to 1997, where he directed application systems development. Mr. Gosnell began his career at Home Products International, where he worked for nearly 20 years. His final position was corporate director of information systems,

where he was responsible for enterprise-wide information systems and technology.

☛ Read Ross’ insights on Page 3

Jim Fraley
Director, Information Technology, Grand River Dam Authority

J

im Fraley, director of information technology and security, is responsible for supporting the technology and security initiatives for mission-critical functions of the Grand River Dam Authority (GRDA). He currently is responsible for overseeing and coordinating all administrative applications, SCADA Systems, metering systems, technology, telecommunications, wide area networking, local area networking, desktop support, IT and physical security, disaster

recovery planning, and applications training and support. The superintendents of SCADA, metering, communications, technical services, GRDA Department of Homeland Security, information systems, and the IT project management office at the Authority all directly report to Mr. Fraley. Mr. Fraley joined the GRDA in 2002 as the assistant superintendent of the metering department. He was named director of information technology in August 2004 as

part of a restructuring to initiate a technology modernization of the entire company. His 19 years of professional work experience also include positions at SPR Inc. and Experian (formerly TRW).

☛ Read Jim’s insights on Page 6

Chris Corrado
Senior Vice President, Technology Solutions, Asurion

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s senior vice president, Chris Corrado oversees Asurion’s expanding information technology, project portfolio management business architecture, and Asurion-managed applications business. Most recently, he was the chief technology officer at eBay overseeing site operations, information technology, and security. Prior to eBay, Mr. Corrado was with AT&T Wireless, where he was chief information officer and executive vice president. While at AT&T

Wireless, he oversaw the alignment of the company’s technical infrastructure with its business strategy. Prior to joining AT&T Wireless, Mr. Corrado was the head of the securities industry solutions practice at Wipro Technologies. In addition, he held CIO and CTO positions domestically and abroad at three marquee investment banks, Merrill Lynch, Deutsche Bank, and Morgan Stanley. All of these firms set the standard for the use of technology in

the financial services industry. He also helped Merrill Lynch manage through the 9/11 tragedy, restoring their capital markets businesses. Mr. Corrado started his career as a programmer and project manager at IBM.

☛ Read Chris’ insights on Page 9

Larry Bonfante
Chief Information Officer, United States Tennis Association (USTA)

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ith over 25 years of industry experience, Larry Bonfante is a seasoned professional who has held leadership positions in the financial, pharmaceutical, notfor-profit, consulting, and sports and entertainment industries. Mr. Bonfante currently serves as chief information officer of the United States Tennis Association. His organization is responsible for all information technologyrelated services supporting the U.S. Open, which is the largest and most highly attended annual sporting event in the world. For example, his group delivers tournament and league applications to over 700,000 members. In addition, he has worked to implement a CRM

and membership management program to support the growing membership of the association. Prior to joining the USTA, Mr. Bonfante spent 10 years at Pfizer Inc., where he served in various leadership capacities including director of global network services and director of global IT planning. He has extensive experience in running global services organizations and has implemented and managed a number of large complex outsourcing partnerships over the course of his career. Mr. Bonfante serves on the boards of the Westchester-Fairfield chapter of SIM, the Technology Managers Forum’s Futures

Advisory Board, and the Center for Business Information and Technologies at the University of Bridgeport. He is also a member of the CIO Executive Council, the Editorial Advisory Board, and Events Committee for CIO magazine and is a mentor and adjunct faculty member of the Columbia University executive masters program in technology management.

☛ Read Larry’s insights on Page 11
About the Authors ExecBlueprints 2

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Ross Gosnell
Vice President, Information Systems and Technology, Delta Dental of Illinois

Something might look great on paper, but if it doesn’t bring anything to the organization, it is not worth the effort.
Ross Gosnell Vice President, Information Systems and Technology Delta Dental of Illinois

Upcoming Changes
Within our organization, there is an effort to optimize our customers’ and our prospective customers’ access to information through self-service, resulting in instant gratification and 24/7 access to information. We have determined that increasing customer retention, new customers, and market share are critical for the achievement of our strategic goals. And, in order to attract and retain customers, we need to find new and interesting ways to engage them through personalization and real-time Web access. New applications that are easy to use, functional, and deliver a competitive or unique product are key to the success of our sales and marketing efforts, which also are critical for our growth.

an understanding of what we need to do before we start down a major path.

Planning
I spend about 20 percent of my time on strategic issues. A lot of that time is spent on creating a development plan. I look at not only tactical issues, but big-picture and long-term issues as well. Any new project or requirement requires an environmental scan of existing modules and processes. When a new process is required, we sit down in a meeting and look at our library to see what we can reuse. During the alignment process, we do a complete assessment of the company’s needs in order to maximize the opportunities that IT innovation brings to the table. We look at our needs constantly to make sure we are optimizing our value to the organization.
Ross Gosnell
Vice President, Information Systems and Technology Delta Dental of Illinois

“Many of the services that we offer are, in fact, becoming commodities.” • With company since 1997 • Responsible for all facets of IT • Previously systems vice president for North American Systems • B.S., Accounting, Roosevelt University • M.B.A., Benedictine University Mr. Gosnell can be e-mailed at ross.gosnell@execblueprints.com

part of senior management is positive for the organization.

Reviews
Conducting comprehensive technology reviews to determine if IT is being used creatively is an ongoing process for us because we strategically align IT with overall business goals on an annual basis. Our need to drive innovation continues to mandate our search for new and better solutions. Major projects require crossfunctional reviews, so we attain a 360-degree perspective during the evaluation and defining of requirements. Cross-functional teams are critical in making sure that we have
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ROI for Outsourcing
When calculating ROI, our process is similar whether we’re looking at in-house development or outsourcing. One of the most overlooked components in terms of assessing accurate costs for outsourcing, however, is the quality of communication regarding requirements. While you may be able to rely on informal discussions for in-house projects, you must be extremely careful to formalize communication about outsourced projects in documents and meetings.
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Senior Management
We are big on strategic alignment as well as department alignment, and it all starts at the top. Senior management is asked for input on potential IT projects for the business. However, it is IT’s responsibility to support the strategic goals and provide insight into the action plans and tactical efforts which are necessary to achieve alignment. The fact that IT is at the table and

Ross Gosnell
Vice President, Information Systems and Technology, Delta Dental of Illinois

(continued)
elements, they are considered for incorporation into new systems.

Consequently, when you outsource something, you need to factor in delays to allow this proper communication to happen. These delays can be significant, especially if you are outsourcing to a country that doesn’t share your native language.

Business Impact
When the World Wide Web was new, interactive Web applications had a tremendous competitive advantage. For a short time, our Web offerings were ahead of the competition by at least a year, and our sales efforts were able to bring these new services to the attention of potential buyers. Although the ROI calculation was not much different than any other calculation, we had difficulty measuring the long-term benefit of being recognized as a leader in technology in our business segment. Even though our competitors have caught up in their offerings, the fact that we were an early adopter helps us. We are still recognized as being ahead of the curve.

looking for information and ways to make better decisions, we have focused our efforts on the next stage by providing data to external clients via the Web for ad-hoc queries and analysis. Business analytics is, therefore, a company initiative that primarily benefits our customers and external stakeholders. It is a key component in our sales, marketing, and product development plan.

Challenges
When leveraging IT innovation, one of the greatest challenges is overextending your resources. You may find yourself trying to develop applications and services that may not meet strategic goals. Trying to make something work with initiatives that aren’t strategically aligned is a challenge. Finding reasons to do things that aren’t necessarily important in the first place is another challenge. From a practical goal perspective, sometimes the technological components are not readily available. You may need to adopt another process, which could introduce

Benchmarking
While we don’t have formal benchmarks, any projects of a certain financial size require cross-functional team participation. Gaining this 360degree view of projects enables us to recognize our current services. If those services have innovative

3 Challenges to Leveraging IT Innovation
1. Overextending your resources (especially into areas that don’t meet strategic goals) 2. Adopting the wrong approach (and thereby creating extra work) 3. Letting costs get out of control (through licenses, etc.)
Ross Gosnell ExecBlueprints 4

Current Programs
One of our current IT programs that will positively affect business potential is business analytics. Most data-driven organizations are on their way to using analytics internally. They can use analytics to deliver customer solutions with new information based on their own data. Those who will be able to deliver the data first will receive major benefits. Business organizations are rapidly adopting business analytics internally, but we have passed that point. Because customers are now
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Ross Gosnell
Vice President, Information Systems and Technology, Delta Dental of Illinois

(continued)

significant additional costs that could have been avoided by using less traditional software. A third challenge is cost. Sometimes the cost of leveraging a new capability is significant. A great IT solution might require additional licensing and costs can quickly get out of control. In order to deal with these challenges, you have to keep yourself in check. It is easy to get swept up in the technological sweetness of a solution. Something might look great on paper, but if it doesn’t bring

Best Practices
Our senior analysts conduct periodic reviews of the IT projects that are under construction. We also have product reviews by cross-functional teams for each new project design phase as well as a review by senior management during the annual strategic planning process. We have done a good job of leveraging technology solutions. By developing a flexible architecture, we have made it easy to develop new applications and can provide a quick response to customer and client requests for information.

anything to the organization, it is not worth the effort. Bleeding-edge costs can be significant, so you need to have a timeline. You can’t hammer something in to make it fit if a more appropriate

solution is coming down the road. A reasonable ROI calculation will help you identify costs as long as you don’t allow them to get in the way of your objectives. ■

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Ross Gosnell

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Jim Fraley
Director, Information Technology, Grand River Dam Authority

Improving Security
Since we have modernized our systems, it has become easier to restrict, monitor, and maintain access to critical systems as well as provide users with the nice front end with which they are getting accustomed. In our industry regulatory agencies are suggesting and mandating standards that will hugely impact us from a security standpoint. Maintaining physical and electronic security is a concern for us on every project. Consequently, we have different policies and standards for the different systems and devices we use in our company. I can’t get into any detail, but we use a number of methods on the electronic side of things. We are always focused on budget. With regard to security, we have requirements to meet regardless of the cost. This is another area where we have modernized and so plan to keep the existing systems for as long as they are practical. When considering when it’s best to leverage IT innovation, you have to understand your limits. You have to understand what is practical and reasonable, because the sky is the limit these days. With enough time and money, you can do anything, so you have to understand where your ceiling is along with what your goals are for the project. For example, most applications today generally offer a really nice presentation. So, if you are unable

to develop a nice application presentation, you start off behind the eight ball in terms of creativity. Lately we have taken more input from the business side and allowed them to be a little more creative than we have in the past.

Aligning IT Goals with Company Strategy
I am pretty lucky in that I oversee all of the departments that are ITintensive, so I am very likely to see where those departments are headed. I can also be involved in determining where the overall IT vision needs to move in order to meet the demands for those departments. If we were to view the beginning process at a very high level, we would ask the business owner or somebody that is the subject matter expert for a requested project to be directly involved in the process. Depending on what we are trying to accomplish, the business owner or subject matter expert would be in the room with someone from our technical services group. Those are the people who manage all of the networks, security, servers, and hardware. In the early stages of a project, we would also have a head from the software side involved. Such a meeting would help us gather requirements from the business side and technical side at the same time. At that time, we would talk about the goal(s) of the

Jim Fraley
Director, Information Technology Grand River Dam Authority

“I am in meetings all week with the business owners, and they are continually giving me input on how we could be a little more creative. Their feedback helps me shape the overall vision for everyone involved in IT.” • With utility since 2002 • Named director of IT in 2004 • Responsible for supporting technology and security initiatives for mission-critical functions • 19 years’ experience includes positions at SPR Inc. and Experian (formerly TRW) Mr. Fraley can be e-mailed at jim.fraley@execblueprints.com

We can virtualize servers, applications, and storage to make sure our business stays running, even in the event of a disaster.
Jim Fraley Director, Information Technology Grand River Dam Authority
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project, even while everyone is looking at it from their own viewpoint, whether from the server perspective or the business owner’s. Additionally, we would conduct a couple of high-level studies first and ask ourselves some key questions: Do we have the skills? Do we have the time to do it? What is it going to take if we provide the solution in house? Those are the things we do just to get started. As you can see, there are slight differences in the sourcing

Jim Fraley

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Jim Fraley
Director, Information Technology, Grand River Dam Authority

(continued)

Our communications system is always online with the meters allowing us to examine meters in real time, so it tells us a lot about what our system is doing. In addition, it generates a lot of data that we can use to understand how the system is performing overall. The data is fed into a Web-based system that is far more flexible and reliable than what we had in the past. IT innovation has also changed the way that our customers can access data that is generated by different devices. So, our efforts have not only been instrumental in helping input numbers into our billing system quicker, better, and more accurately, they have also helped customers to become better educated about what they are buying from us.
Jim Fraley Director, Information Technology Grand River Dam Authority

objectives for the different parties involved.

IT Innovation: Impact on Business Potential
We reinvented how we acquire, manage, and generate the numbers that go into our billing system. In the past we manually read a large number of our electric meters, which was very time-consuming. Now, we read our meters using a wireless communications system, which we are currently rebuilding.

We manage our own wide area network and do everything from erecting the towers to putting up the dishes to managing the equipment. From a business standpoint, this capability allows us to actually move around bandwidth and services however we see fit to increase the functionality of some applications. From a security standpoint, we can envelope data and systems so that no one can get to them. This may reduce freer access through communications systems, but it is a lot more secure. The new systems

are also redundant. This gives us fail-over capabilities between many of our sites in milliseconds. We can virtualize servers, applications, and storage to make sure our business stays running, even in the event of a disaster. Ultimately, this will change the way that we do business down the road.

Benchmarks: On the Right Track
For some of our systems, we use the vendor as a sounding board. We

Launching Your IT Project the Right Way: Critical Factors for Success
At the beginning, form a committee of people with diverse expertise. . . Composed of. . . • Business owner • Subject matter expert • Member of the technical services group (managers of the networks, security, servers, and hardware) • Software developer Ask the tough questions. . . • What are some business and technical requirements for the project? • Do we have the skills? • Do we have the time to do it? • What is it going to take if we provide the solution in house?

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Jim Fraley

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Jim Fraley
Director, Information Technology, Grand River Dam Authority

(continued)
going to perform for the length of time that we need. Finally, we will look check to see how fast other companies are changing out solutions and if they are leading or following what we are doing. ■

ask, what are other utility industry companies doing? We stay informed through trade magazines on new technologies so that we do not get left behind or caught up in the hype of something that is bleeding-edge. We have our own short-term window, and we try to understand what will work for us. In the case of the

communications system, we looked at long-term ROI as well as the dollars that we have invested in that system and how long we really need it to be around and compared that to the life expectancy of the equipment and technology. We will also consider a number of other factors to make sure that our solutions are

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Jim Fraley

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Chris Corrado
Senior Vice President, Technology Solutions, Asurion

Upcoming Changes
Over the next 12 months, we are going to be doing more integration of our front-end systems, which handle clients. As the business adopts an integrated strategy, we’ll create one look and feel, one set of work flows, and a non-proprietary messaging system. In the past we had built those systems and going forward we will unify them and take a very serious look at what is available in the market. A business strategy that calls for a unified front end, middleware, and a workflow engine is driving these changes. Priorities for the middleware components are scalability and reliability, while the actual workflows are business-driven.

If you try to be perfect, it may take too long, but if you’re not good enough, you may get fired.
Chris Corrado Senior Vice President, Technology Solutions Asurion

and the senior leadership team that runs our functional disciplines and business units. Our semiannual review involves the senior leadership team. Our quarterly review involves the president, chairman, the CEO and leaders of the major functions and businesses.

Chris Corrado
Senior Vice President, Technology Solutions Asurion

Conducting a Review
On an annual basis, we conduct a comprehensive technology review to determine if IT is being used creatively and how well it is supporting business objectives. We also have rigorous quarterly updates. Our annual review process involves the IT organization, the chairman, the president, the CEO,

“We’ve grown three-fold in the two years that I’ve been here. By the end of this year, this growth will probably be five-fold. Without our technology investments, this level of growth would never have happened.” • Oversees company’s expanding project portfolio management business architecture • Previously chief technology officer, eBay • Former CIO and executive vice president, AT&T Wireless • As CIO, helped Merrill Lynch restore business after 9/11 tragedy Mr. Corrado can be e-mailed at chris.corrado@execblueprints.com

Formal Planning
We use a formal planning process to leverage IT innovation. We start with a classic set of business objectives for a calendar year and turn them into a set of corporate and client-based priorities. From there, we build specific client account plans and try to determine out how to deliver to those plans. We then create one portfolio of initiatives for the year that includes what we want to do for customers as well as how we want to optimize the business. This single prioritized portfolio drives much of our IT investment. It’s client- and functionally-driven for those functions that are generating revenue or supporting revenue-generating areas. It is reviewed every other week by the president, chairman, and CEO, and by the overall leadership team on a quarterly basis. In addition to the president, chairman, and CEO, the heads of sales,

Current Programs
It’s all critical: performing our front-end systems program of work, replacing middleware, and revisiting the logistics system. In four years, we could easily triple in size again, and it’s not clear that our current set-up is going to provide the headroom to support the business at that volume. Right now, for instance, we’re implementing a PeopleSoft ERP system to replace one that was not designed for an enterprise our size. This new system is going to handle all of our human resources and financial needs.
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marketing, call centers, distribution and logistics, risk, finance, and HR are asked for input regarding IT’s potential impact on the business.

My Time
I devote 10 percent of my time to strategic IT planning. This percentage should probably be more like 15 percent. Given the growth of our business, the multitude of decisions that have to be made often shadow some of the strategy work.

Chris Corrado

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Chris Corrado
Senior Vice President, Technology Solutions, Asurion

(continued)

However, this mix is now changing to favor more strategy work.

Example of Impact
We have a distribution logistics and repair profit center that was ready to throw a system out the door when I arrived. While it’s always easier to consider throwing something out and replacing it with something new (either bought or built), in this case I decided that it was too risky. I met with the developers of the system (in this case, a vendor) to talk about the constraints and the diagnostic tools we needed to employ in order to understand how the system was performing and to help the vendor understand our needs and address the issues we were having. We fed them data and helped them analyze the problem and test new spins of code. We upgraded the product in small increments that improved it dramatically. We created a spec for a system that would replace a component of the system, but then decided not to do even that because we were already realizing gains in our work. So, we hedged but found that we didn’t need to use the hedge — like what happens when you buy an insurance policy. Replacing this system would have taken a long time, cost a lot of money in both cash spent as well as in opportunity lost, and caused a lot of planned (and possibly unplanned) business disruption. But, as a result of the process we went through, we instead were able

3 Common Challenges to Leveraging IT Innovation
Hiring ahead of the curve Determining essential stability and reliability Completing milestones at an appropriate pace for the scope of the project
to increase our volume three-fold within 18 months without changing the basic product. common code base that works everywhere, but our changes support different character sets and regulatory bodies.

International Locations
Some companies run their international businesses like relatively independent entities that share infrastructure. We send people who understand our business and the operation of our systems to remote locations to help replicate as much of the business processes and technologies we are using domestically as possible. They spend time understanding the local nuances and come back to build a release of the system that’s suitable for the international location. The people who end up operating the system are locals. We have the leverage of a

Challenges
The greatest challenge in leveraging IT innovation is hiring ahead of the curve. Determining stability and reliability is another challenge; it’s actually an optimization problem. If you try to be perfect, it may take too long, but if you’re not good enough, you may get fired. A third challenge is speed. There’s reliability and then there’s speed to market. If you go too fast, you may break things, but if you go too slowly, you may miss opportunities. ■

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Chris Corrado

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Larry Bonfante
Chief Information Officer, United States Tennis Association (USTA)

Upcoming Changes
Currently, we’re dealing with issues of compliance, so we’re making investments to ensure that compliance and information security are in place. We’re expanding our player development to a new facility and we’re giving those people the technology services they need. While we’re doing very well as an organization, we see some potential financial storm clouds on the horizon, which is why we’re working to find ways to create new revenue streams and develop efficiencies to bridge financial gaps in the coming years. Consequently, business realities are driving most changes. While our revenue stream has increased year after year, there’s only so much we can charge a person for a ticket to the U.S. Open. It’s not an elastic price point. At a certain point, people will stop coming. The same thing goes for membership; there’s only so much we can charge people for membership before they fail to see the compelling value. Both of these realities create a ceiling to our revenue stream.

annual performance review. To me, “performance management” is not an event. The Super Bowl is an event. Rather, it should be an ongoing process of constant feedback concerning what’s going right and what’s going wrong. The actual review should be a no-brainer because you’ve been having the conversation year round. You should approach using technology in an innovative way with the same attitude: it’s not an event that we do once or twice a year. We have a running dialogue about how we can bring technology to bear, what’s happening in the outside world, what consumers are doing, and how we can leverage new technologies.

Larry Bonfante
Chief Information Officer United States Tennis Association (USTA)

“We don’t go into a little lab and do everything in a vacuum before unveiling what we’re going to do to the world.” • Over 25 years’ experience in financial, pharmaceutical, and sports and entertainment industries • Responsible for supporting IT needs of the U.S. Open • Member, board of directors, Technology Managers Forum’s Futures Advisory Board • Member, CIO magazine Editorial Advisory Board • Presenter at industry conferences: IDC, Comdex, Networld-Interop, and the Technology Manager Forum Mr. Bonfante can be e-mailed at larry.bonfante@execblueprints.com

Leveraging Innovation
Many variables play into deciding when and where to bring innovation to bear. When considering how to best leverage IT innovation, economic realities first need to be considered. We think about what we can invest, what the investment portfolio will look like, and whether we can show a return on investment within 12 months so that the innovation will pay for itself. We also consider whether there are reasons that we can’t innovate in a certain area. For instance, we don’t control some of the management of our tours, so there are places where

Conducting Technology Reviews
We conduct ongoing comprehensive technology reviews to determine whether IT is being used creatively. When many people say “performance management,” they think about an

we need to partner with outside organizations.

Important Parties

If you’ve got a culture where somebody tries something that fails and then gets punished for it, you’re not going to see very much future innovation.
Larry Bonfante Chief Information Officer United States Tennis Association (USTA)
© Books24x7, 2007

We ask all parties in the organization for input regarding IT’s potential impact on the business; the IT team, the business unit leadership, the volunteer leadership, and the board are all engaged in the dialogue. While not everyone has the same level of contribution or
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Larry Bonfante
Chief Information Officer, United States Tennis Association (USTA)

(continued)

insight, they all have a role to play in the process. We try to embrace everybody in our client constituency. We get their input so that when the product comes out, they can see their fingerprints on it.

3 Key Steps to Fostering a Culture of Innovation
Make it safe to innovate — don’t punish people if their ideas don’t work.

Significant Impact
We implemented a new membership management system two years ago that allowed us to do a number of things:
1. Outsource our call center capabilities at a lower cost, which had a business impact. 2. More effectively market to people to get them excited about joining the USTA, renewing membership, and lengthening the duration of their membership. 3. Provide self-service on the Web so people could upgrade memberships, change addresses, etc. Giving them an interactive experience that they can control makes the member feel empowered and able to impact their tennis world.

Provide forums for the sharing of ideas. Cultivate managers who are willing to take risks and view the future differently than they did the past.
Best Practices
It is critical to create a culture of innovation. By definition, not all innovative ideas are going to work. If you’ve got a culture where somebody tries something that fails and then gets punished for it, you’re not going to see very much future innovation. Instead, you have to create a culture where it’s safe to innovate. You also need to create a process where people can talk about innovation. If people have

If you look at the sports and entertainment marketplace in terms of broadcast, revenue, and sponsorship, you’ll see a changing landscape. The Internet has created a whole new broadcast arena, which means that, in terms of broadcast rights, the power has shifted to the broadcasters and away from the leagues. With the exception of the NFL, all of the leagues that have renegotiated for broadcasting rights over the last five years have had to take less money. Our organization, then, must deal with any shortfalls that result from the reality of the economic climate in the industry.
Larry Bonfante Chief Information Officer United States Tennis Association (USTA)
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Larry Bonfante
Chief Information Officer, United States Tennis Association (USTA)

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look at some of the more creative organizations in any industry, they’re not only looking to their own R&D people for ideas, they’re also looking to their customers, their supply-chain partners, and their consumers. They are willing to embrace ideas that were not necessarily invented in-house. ■

an idea to contribute or they want to have a dialogue, there should be a forum in which they can engage. And you need to have management that is receptive to supporting innovation. They have to be willing to take risks and look at things differently in order to see new business opportunities. They have to view life in the future differently than they’ve viewed it in the past.

Challenges
Not everybody comes from an innovative culture, so there’s a need for education and marketing. We don’t have a huge bank account, so we need people to know how to take smart, educated risks. Not every think tank idea gets all the way through the process, so sometimes we have to look outside the organization for ideas. If you

© Books24x7, 2007

Larry Bonfante

ExecBlueprints

13

Ideas to Build Upon & Action Points
I. What Are Some Creative Uses of IT?
IT creativity can manifest along multiple dimensions, including innovating new products that will launch the company ahead of its competitors, devising interesting ways to engage customers, and/or providing tools that will enhance the creativity and productivity of the company’s employees. Specifically, at the authors’ companies, IT ingenuity has created the following new business opportunities and capabilities: • Customer 24/7 access to critical health information as well as analytics to guide healthcare decisions Member management systems that enable more effective marketing to new leads and self-service capabilities to existing customers Flexible architecture that enables smoother development of new applications and quicker responses to customer and client requests User-friendly and integrated front-end applications Enhanced ability to restrict, monitor, and maintain access to business-critical systems Wireless, online communications systems that enable a power utility to read meters, process data more quickly, and educate customers Upgrades to older systems, thereby saving money and time • Are there any components that you plan to outsource? If so, have you factored in additional costs for communication and inevitable delays? Will this initiative put you ahead of the competition? By how much (in terms of time)? In what ways will the technology support the company’s growth? engaged in dialogue about what’s happening in the outside world, what consumers are doing, and how the company’s technology can be applied to these needs. You can foster such a work environment by: • • Using vendors as sounding boards to learn what the competition is doing Staying abreast of current technology developments by reading trade magazines Consulting interested parties outside of the department — such as customers, supply-chain partners, and consumers — for new ideas Hosting forums and other events where people can exchange ideas Increasing management support of potential new business opportunities by raising overall risk tolerance Encouraging people to try out new ideas — and not punishing the “guilty” parties for the ones that don’t work

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III. Must-Have Approaches Toward Aligning IT Creativity With Company Strategy
Now that the CTO/CIO has a seat at the leadership table at many companies, he or she must plan to devote upwards of 20 percent of their time on strategic planning, which include not only tactical concerns, but big-picture and long-term issues as well. In order to determine how the creativity of your IT team can optimally serve business goals in the future as well as monitor your current progress, plan to: • • Completely assess the company’s IT needs on a regular basis. Ask senior management for input on potential IT projects and how IT can be more creative. Begin project planning with a meeting of the business owner, subject matter expert, technical services representative, and software development specialist. Conduct high-level studies on IT capacity (e.g., current skills, availability, etc.). Create a portfolio of initiatives that employ business objectives, corporate and client-based priorities, and client account plans. Conduct periodic technology reviews as well as cross-functional (360-degree) project reviews that involve company leaders as well as the IT organization. Scan existing modules and processes for components that can be adopted into new projects.

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V. Essential Take-Aways
It is easy to get swept up in the “technological sweetness” of a solution. Something might look great on paper, but if it doesn’t bring anything to the organization, it is not worth the effort. Challenges you may encounter when attempting to apply creativity to technology projects at your company include: • Setting an appropriate time to market: if you go too fast, you might break something; if you go too slowly, you may miss opportunities Determining acceptable levels of stability and reliability Hiring talent ahead of the curve Overextending resources — costs to leverage new capabilities can be significant Developing applications and services that are unimportant, or do not address strategic goals Discovering that essential technological components are not available Accommodating the often-differing needs of business partners, where applicable ■

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II. The Bottom Line
When endeavoring to innovate new technology, you should always be aware of your company’s critical needs and what it can realistically spend on IT projects — keeping in mind that it can be difficult to measure the long-term benefits of being recognized as a leader in technology. Before launching initiatives — especially those that will require R&D — important cost considerations are: • • • What requirements do you need to meet, regardless of cost? Will the new technology be able to show a 12-month return on investment? What is the life expectancy of the proposed technology and its equipment?

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IV. The Golden Rules for Creating a Culture of Innovation
Using technology in a creative way cannot be an event the department engages in once or twice per year. IT departments that succeed at leveraging their innovations are continuously

© Books24x7, 2007

Ideas to Build Upon & Action Points

ExecBlueprints

14

Ideas to Build Upon & Action Points

(continued)

?
10 KEY QUESTIONS AND D ISCUSSION POINTS
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In the next 12 months, what major changes in your company’s IT portfolio do you expect? What is driving these changes? How do you expect these changes will affect the company’s business potential? How often do you conduct a comprehensive technology review to determine if IT is being used creatively? Is only the IT organization involved in these reviews, or do you utilize a cross-functional approach? Do you use a formal planning process to leverage IT innovation? If yes, how was this process developed? If no, do you plan to implement such a process in the next 12 months? Why or why not? When considering how to best leverage IT innovation, what factors are most significant? Proper alignment of IT goals with company strategy? Complete assessment of company needs? Implementation of most vital IT programs? Other? What parties are asked for input regarding potential IT’s potential impact on the business? Do you expect this process to change in the next 12 months? If yes, how so? What percentage of your time do you devote to strategic IT planning? Is that amount of time ideal, or do you wish you could devote more or less? What effect do you feel your efforts have had on the business? What role should outsourcing play in the creative use of IT? How did you calculate ROI for outsourced projects and processes? Could you give an example of when an IT program has had a significant impact on business potential at your company? How did you calculate ROI for this initiative? Could you give a breakdown of the IT programs currently underway that you believe with positively affect business potential? What kind of benchmarks do you use to make sure efforts to leverage IT innovation are on track? How is progress measured? How often?

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Ideas to Build Upon & Action Points

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