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In our first post we introduced the three pillars to digital innovation success (automation, hybrid cloud and cloud native), in this next post we wanted to dive a little deeper into what digital innovation excellence means. 

Across Europe business leaders we talk to say that software is central to digital innovation and that organizations must become software producers at increasing speed and scale. As organizations evolve to become producers of software, the role of software development and delivery expands. 

Not only are organizations plugging into software development and delivery capabilities to increase organizational competitiveness by controlling a larger share of digital value creation, but software increasingly becomes part of the business's core product and services offerings. But that's not all. Software delivery is also expanding to support the ability to scale digital distribution and monetization of digital products and services through the digital ecosystem. This means that software can be delivered as a service, through direct sales channels, via APIs, open source repositories or via style platforms. Software is truly permeating the organization and digital innovation factories and supply chains become new organization requirements for digital resiliency.

In this journey, both IT and senior business leadership play a larger role in ensuring organizational and architectural coherence, security, compliance, scalability, and digital autonomy. Importantly, the new world of digital innovation requires that senior leadership significantly transform IT culture, talent, practices, tools, and supplier relationships to deliver software innovation at scale. This is not a small feat; digital innovation at scale is hard! 

Excellence in digital innovation requires the alignment of human and technology resources but getting digital innovation right will be a game changer for organizations. We already find that in 2020, some software-led organizations (those with a high degree of software dev and delivery maturity) can push digital ideas to production at four times the industry average. Current business disruption accelerates the focus on hyper-speed and -development to the extent that organizations mastering digital innovation and putting compressed innovation tactics to work can take digital ideas to production at four times the current innovation rate. The definition of how fast things get done is being challenged continuously. 

So, what are the benefits, main characteristics, and importantly what can you achieve by plugging into and scaling your digital innovation capabilities? In IDC's view digital Innovation excellence will: 

1. Secure your business productivity competitiveness against peers, and from here your ability to push out differentiated digital value understood as digital products and services. We've already concluded that your rate of innovation is four times the market.  

2. A unified software development and delivery capability with full business alignment is at the core of your strategy, this means that you are one of just 20% of organizations that have a development culture ensuring the competitive advantage of the business. This clearly separates you from the pack!

3. A unified automation strategy will underpin cross-team collaboration models, help ensure automation consistency and drive a culture of re-use. It can also help you drive a culture of discipline and a policy driven approach to security, governance and compliance allowing the organization to take advantage of leading-edge innovation. Again, this can put you in the top quartile of European organizations in terms of software delivery capabilities and automation prowess. 

4. Through a hybrid cloud strategy you can help  your organization’s digital resiliency by laying the foundation for an intelligent architecture that supports integration, security, portability and controls.  You are also able to maximize the ROI of existing IT investments and drive a fluid data-led organization by orchestrating all data assets and ensuring data compliance. 

5. Finally, to maintain competitive status the app delivery engine should be based on cloud native tenets to support rapid release and perpetual product development patterns. Running integrated cloud native operations across the organization will be key here to truly operate with efficiency and ensure speed-to-delivery alignment between teams and business functions. Today only one in five organizations are driving their cloud native activities formalized as well-governed, joined up programs spanning the entire business. 

Stay tuned for our final post in this series to find out how you can put the building blocks in place to become a Digital Innovation Innovator. 

[1] IDC Infographic, sponsored by Red Hat and Intel, "Digital Innovation Imperatives for Successful Business Transformation," EUR#146775020 and September 2020.

About the author

Jen Thomson is an IDC senior research director with over 20 years of experience in the IT industry. She leads the Accelerated App Delivery Practice for IDC in Europe and provides insights on the investment strategies and decisions of European enterprises as they transition to modern application architectures.
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