In the recent past IT service providers have been under enormous pressure to simplify and standardize their services, to increase efficiency through reorganization, and to introduce selective sourcing –all as a response to shrinking IT budgets and more aggressive competition. The top management’s expectations of those responsible for IT are still rising. This means that IT service providers are under time pressure to provide solid evidence of the value proposition made to their customers concerning their competitive ability to change and innovate.

The evolving ecosystem


Innovation is the successful exploration and exploitation of new ideas and creates value for society and for economies. In his book, Open Innovation: The New Imperative for Creating and Profiting from Technology, Harvard Business School Professor Henry Chesbrough emphasizes the transition from closed forms of technological innovation tied solely to corporate R&D labs to the dominate trend, readily observable in the last two decades in the U.S., of decentralized research and looking outside the company for innovation. In the 21st century innovation is the domain of government and university R&D labs and small startup companies: corporate enterprises focus their own R&D on creating near/mid-term revenue cycles consisting of current and next generation products and services.


The pace of innovation is relentless and often requires the cooperation of various partners, the licensing of intellectual property, or the creation of completely new business models for the innovations to succeed.


Innovation and differentiation


Businesses must be innovative to maintain their differentiation and competitiveness, to create new opportunities, capabilities, and efficiencies. Businesses increasingly look outside for innovations that will take them beyond the two-year product and service life cycle. Innovation is critical to Information & Communications Technologies (ICT) companies and has become a necessary tool to compensate for declining revenues. Thus effectively identifying and prioritizing innovations, as well as fostering an innovation culture, are imperative when it comes to organizational success and future profitability.


This article aims to provide a holistic framework as to how innovations can be effectively discovered, evaluated, described and distributed into an organization.
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