Article | Harvard Business Review | January–February 2014

The New Patterns of Innovation

by Rashik Parmar, Ian Mackenzie, David Cohn and David Gann

Abstract

The search for new business ideas—and models—is hit-or-miss at most firms. Tackling the problem systematically, of course, will improve the odds of success. Traditional ways of framing this search examine competencies, customer needs, and shifts in the landscape. This article proposes adding a new IT-based framework. It involves asking the following question: how can data and analytic tools be used to create new value? The authors have explored that question with many clients. In their work, they've seen IT create new value in five patterns: using data from sensors in objects to improve offerings (think smart energy meters); digitizing physical assets (such as health records); combining data within and across industries (to, say, coordinate supply chains); trading data (as mobile providers do with information on users' whereabouts); and codifying best-in-class capabilities (such as online expense management) as services. Drawing on examples from their own experience and their clients', the authors walk readers through each of the five patterns and how to apply them. They also provide advice and questions that will help executives get started on their own searches.

Keywords: Value Creation; Information Technology; Innovation and Invention;

Citation:

Parmar, Rashik, Ian Mackenzie, David Cohn, and David Gann. "The New Patterns of Innovation." Harvard Business Review 92, nos. 1-2 (January–February 2014): 86–95.