It is very common to relate technology, innovation and business as an almost continuous whole through which the most advanced management strategies are directed.
A new technology bursts in that promises to change the way we do business or communicate and we quickly look for ways to apply that new technique to the company. The media and social networks are an optimal showcase to convey that sense of progress which in turn generates the need for innovation.
But does the technology applied to the company always generate innovation?
Printers and Publishers
Peter Drucker gives an example that compares the importance of technology with that of information processing.
In his book Management in the 21st century analyses what the invention of the printing press (Technology) meant and how as machines became more common and cheaper, they ceased to be an innovative factor. This innovation was generated by the (Information-centric) Publishers.
"The printing revolution immediately created a new class of information technologists, just as the most recent information revolution has created a whole range of companies, IT and GIS specialists, software developers and IT managers. The IT experts of the printing revolution were the first printers; they were non-existent - and not even imaginable - by 1455, twenty-five years later they had become stars. These printing virtuosos were known and revered throughout Europe, just as the names of major computer and software firms are recognized and admired worldwide today.
By 1580, technology-oriented printers had become ordinary craftsmen (...) Their place was soon taken by what we now call publishers (although the term was not coined until much later), people who no longer concentrated on the 'T' in IT, but on the 'i'."Technology must support the processes that drive information through organizations. Click To Tweet
The business processes of a company are the intermediate layer and the fundamental axis of communication between roles and systems. In these processes the Information is the one that allows to execute transactionsto determine conditions and make decisions. A company with defined processes that use standard conventions and notations between departments enables effective communication within and outside the company.
Technology must support the processes that drive information through organizations.
Incorporating technological improvements must be the consequence of executing a business strategy within a broader framework related to building competitive advantages that allow differentiation.
The 7 sources of innovation
The 7 sources of innovation cited by Peter Druker in his book "Innovation and Entrepreneurship" are
Innovation within the company
- Unexpected eventsWhen a company obtains very different results from those expected, both negative and positive, it tends to ignore them instead of taking advantage of the information generated
- InconsistenciesAnalysis of the difference between expectations and results provides information on a pattern or trend that we have not yet discovered
- Processing requirementsMinor adjustments to specific processes can lead to substantial improvements without having to restructure or rethink everything from scratch
- Sector and market changesThe ability to react quickly to a sudden change in the market or in a particular segment gives us an advantage based on agility
Innovation outside the company
- Demographic changesThe reason why companies often ignore these changes is because they are slow. However, anticipating trends related to the market and its composition can have a great impact on innovation
- Changes in perceptionThe reality perceived by our market does not have to be rational or based on objective data. An example is the growing demand for healthy products while increasing life expectancy and quality of life
- New knowledgeThe most obvious, it is also the one over which the company has the least control. Companies that can generate this type of innovation require capitalization to support research cycles that are long in time and that do not always end up being successful.
Measuring digital transformation
When applying information technologies in the company, it is important to measure the impact on business processes and check the extent to which the company is transformed operationally and strategically, regardless of how innovative the tools it uses.
The process by which a salesperson submits an order to the office may require a management person to review the customer's credit limits or whether there are any special promotions available, for example.
If this information travelled to the seller or was applied automatically, we would avoid duplication of information processing, which is the real purpose of the application of technology in the company.
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