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Taking a wholistic view of innovation, it consists of more than just moving the business in a new direction; instead, it encompasses, collaboration, openness, and a global view and integration of the business by using technology. To truly take advantage of innovation, companies must go beyond a focus on products and services, they must innovate across multiple dimensions of their business: Product innovation Chapter 3. Marketplace directions 25 Companies must develop and bring to market products that stand out—in features, function, cost, and availability.
In fact CEOs are now giving business model innovation as prominent a place on their agendas as product, services or markets innovation and operational innovation. Figure 3-1 shows the changes in thinking of CEOs between The Global CEO Study 2004 and the new Global CEO Study 2006. Clients today are looking to innovation to drive fundamental change that enables sustainable growth In IBM’s interviews with hundreds of CEOs, they said: and want to innovate their... 2006 2004 they must achieve... Revenue growth Cost reduction Operations (processes & functions) Asset utilization Business model Risk management 20% Products/ services/markets 40% 60% 80% 100% 20% 40% 60% 80% 100% IBM Global CEO Study 2004 IBM Global CEO Study 2006 Figure 3-1 CEO rethinking their priorities 24 Selling IBM’s Innovative Solutions Major market trends, as shown in Figure 3-2, are changing and shaping the business challenges facing companies today.
Once decentralized and dominated by geographical hierarchy, IBM is now a globally integrated company with one management structure and go-to-market strategy with a strong foundation of core values. As the world continues to "flatten" as the Internet and the lowering of trade and political barriers make it possible to do business instantaneously with billions of other people across the planet, IBM continues its transformation, adopting an innovation agenda that focuses on the following: Maintaining differentiation and movement up the value chain in the face of relentless commoditization and disruptive business models Finding new levers of productivity, given the shrinking upside of cost-cutting Becoming the premier example of an on demand business—a firm that is responsive and horizontally integrated end-to-end and that takes advantage of service-oriented architectures, new technologies, and the global spread of the Internet Chapter 4.