Tuesday, November 20, 2012

Standardization versus Innovation

In yesterday's post, we discussed how the most common components of any Enterprise Transformation is usually a set of specific or tactical Standardization exercises. These exercises are meant to help:

  1. Improve inefficiencies
  2. Drive down costs
  3. Enhance current capabilities

The third point here is key - most standardization efforts are directed at moving an organization towards commoditization of already well-understood, previously deployed capabilities. Now it so just happens that standardization efforts are also needed in order to facilitate migration to new capabilities as well (within the context of an Enterprise Transformation), so standardization does play a dual role in some cases. Often times standardization occurs separate from any larger Transformation initiative - a good example of this might development of standard desktop images or movement from traditional desktop management to virtual desktops. Now at first glance, it may seem as though the Desktop Standardization efforts are in fact facilitating enterprise innovation, but this is not always the case.

Virtual Desktops represent progress, right?
Today's topic deals with the more or less constant tension between Standardization and Innovation that exists within most enterprises. We'll use the Desktop Image Management example as our case study. So, let's step back for a minute and ask the obvious - why should Innovation and Standardization necessarily be at odds? The quick answer is this - IT moves between cycles of expansion and distribution to periods of consolidation and centralization. This has been occurring in one form or the other since the beginning of Information Technology as an industry. A good example of a current manifestation of this cycle is the movement towards Cloud Computing as a way to facilitate centralized management (or the consolidation of the data centers needed to provision those Cloud solutions).  

At the same time as Cloud solutions are making inroads, other more disruptive Mobile solutions are forcing a more distributive paradigm - although the hope is to link all of the new disruptive technologies through Cloud. The battle between "taking control" of the enterprise and "taking advantage" of emerging technologies never ends and it never will. The reason that this is the case is that each activity (standardization and innovation) has a somewhat different Use Case:

  1. Standardization is primarily focused on optimization of existing capabilities
  2. Innovation is primarily focused on exploitation of newer capabilities

As we pointed out earlier, there are ways to combine the two Use Cases together in the context of a larger Use Case (e.g. Transformation). There are other ways to do it as well, but we'll return to that in a minute.

So, let's examine the desktop case study again. How might we interpret the ability to centrally provision standard desktop images or do so using virtual desktop technology? Is the goal of standardization to:

  1. Reduce licensing costs (for desktop software)
  2. Simplify OS management, thus reducing Desktop management staff 
  3. Make it is easier for the organization to build new applications and services and apply them to standard environments
or are the goals to...
  1. Extend use of nonstandard devices by being able to centrally manage all sorts of OSs and OS combinations
  2. Facilitate the development of systems that use more than the standard desktop or laptop hardware
  3. Help to open up new business models or mission opportunities for the organization by supporting a flexible set of platforms?
The first set of goals are connected to the Standardization Use Case, the second to the Innovation Use Case. So, what happens if an organization chooses the first set and refuses to acknowledge the latter set? This often results in an innovation bottleneck; wherein only small amounts of innovative new capability can be absorbed into the enterprise - whether the larger organization wants it that way or not. And this is where it gets tricky, because often times decisions made to optimize or commoditize certain areas of IT that are seen as needing to be super-efficient can thus lead to severe restrictions in the ability of any part of the enterprise to be innovative. Worse yet, these conflicts are generally not understood or often not even recognized. The constraints and dependencies of a complex organization aren't generally what's communicated to senior leadership - CXO level folks are generally more interested in hearing where savings have been achieved. 

The problem is though, that more often than not the inability to reconcile the Use Cases leads to more losses than the savings gained in achieving super-efficiency if the enterprise fails to recognize what's really going on. 

Copyright 2012  - Technovation Talks, Semantech Inc.


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