Businesses are keen to boost business performance and customer experience. But the light bulb wasn’t invented by continually improving the candle. How do you balance investment in improvements of legacy systems, processes, and tools and innovation for the best outcome? How do you use emerging technologies to that end?
Contributors

• • Jeff Hutchinson, Chief Information Officer, Bombardier
  • René Berend, Chief Information Officer, PageGroup

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 Transcript 

Sanjog Aul [00:00:22]:

Hello, and welcome to this segment on CTN. To learn more, please visit ciotalknetwork.com. Our topic for today is Technology, Candle, And The Light Bulb  . And our guests for today’s show are Jeff Hutchinson, who is the Chief Information Officer with Bombardier. Hey, Jeff. How are you?

Jeff Hutchinson [00:00:40]:

I’m doing great today. Thanks for having us.

Sanjog Aul [00:00:43]:

Well, thanks for joining us. And we also have René Berend, who’s the Chief Information Officer with Page Group. Hi, Rene. How are you doing?

René Berend [00:00:51]:

I’m also very well here in Central London. Thank you.

Sanjog Aul [00:00:55]:

Much. Thank you. So the reason we wanted to get together today is, this concept of a candle and a light bulb was brought up by people who always mentioned that you can use a candle and a light bulb independently, but then in case you wanted to innovate, you can only improve a candle so much but it cannot really mimic what a light bulb can do and the reason we are bringing this up is because we have business performance and customer experience. These are the two main agenda items for most businesses and what we find is if you are looking at living with the legacy tools and processes and systems, you can only go so far and at the same time if you only do innovation, you cannot just rip and replace everything that you’ve done in legacy. So both of them have to coexist and we need a healthy coexistence. How do we do it? What does emerging technology do or can do to help in this regard? That’s what we wanted to discuss. So let’s start with you Jeff. So we are hearing businesses reporting that they are able to do some innovation and some transformation but not a whole lot because they are burdened by the legacy mindset, processes, people, and tools. What is the reality on the ground?

Jeff Hutchinson [00:02:31]:

So, it’s a very great question to ask, and, as I look at the corporation that we’re in, for example, plus prior ones I’ve worked in, and I’ve worked in mainly large corporations and both in consulting, by all means there’s a balance out there. And the balance is no corporation, or probably no corporation, has unlimited funds to just say, okay, I’m going to throw away the past. Even if they did, the disruption that would cause would be too much for the corporation to handle. Yet at the same time, we also need to think about how do we balance that need for that innovation. And too often we see some of the innovation being the buzzwords to people saying, oh, this is something cool or sexy or exciting that I need to go do. And realistically, as IS/IT providers, so both of us are CIOs, it’s really trying to understand how we’re going to make things go forward, how we actually make things work. I think back to the past and, you know, Henry Ford once said, If I had asked people what they wanted, they would have said a faster horse. And our job within the IS/IT realm is how do we get our colleagues to imagine the future, but to do it in such a manner that it’s not just about the technology. Innovation, new ways of doing things in most areas, in most businesses, is about enabling new processes, new leading ways of doing things, new transformation that’s enabled by a technology where it makes sense. And if you kind of think about how some of those have actually come by is, I’ll give you a real quick story and then I’ll go shut up for a second. We, when I, 1 time, went by an HR organization and the HR organization person said, Hey, Jeff, let me show you my new digital HR system. And I said, Cool. Let me see it. Well, they showed me employee self-service. And I stepped back, of course, I didn’t say it then, but I stepped back and thought about it for a second and said, Wait a second. That’s not digital. That’s just automation we should have done years ago. So, we get caught in this innovation mindset, where buzzwords are hitting us, such as like the word digital. And I have a very narrow definition to the word digital and basically, I simply use the word digital meaning new and or enhanced products or services that we deliver to our external colleagues, our external customers. Everything else is automation we probably should have done years ago. But it’s that continuous idea of how we balance and how we move forward of bringing both of those is really going to what’s going to drive success. So I actually think we do both. We look where the opportunities are to fundamentally drive change and then we leverage at the same time the legacy environments where it makes sense to help stability, to help moving the needle forward on both sides of the house.

Sanjog Aul [00:05:47]:

Rene, what have you seen happening? So Jeff that’s a great response. So Rene, do you see people getting all enamored with all these latest technologies and forgetting what in the first place they are supposed to deliver and that’s where we are stuck saying we don’t like legacy and we like innovation?

René Berend [00:06:07]:

Yeah. First of all, I don’t think there is any company who does not have that on the agenda. Everyone discusses it. But different industries have different challenges. If your legacy systems are, for instance, a bank provides services to clients and customers, it’s very hard to change your legacy system because you have to change your contracts with your customers and clients. If you are a small company with something new, it’s probably a lot easier, when you have a legacy system to replace it. So the agenda, I believe, everyone has the agenda. Why is it that some then have issues with it and others don’t? I struggled with this quite a long time. And I think having worked in change now for probably over 25 years, the key asset there is to get your executive team behind it. Are we going for it as a company or not? It’s not difficult. People say IT is not willing to change. It’s not difficult to convince IT people that we are going to invest in them, and they get the opportunity to learn new tools, technologies, exciting stuff. Likewise, why should business employees object if you create something more up to date and modern? So with this in mind, it is true that legacy environments have grown very complex, but not many internal customers in IT, internal customers in the business, but even external customers would object to bringing something new, especially if you reduce complexity and therefore cost and move these costs towards your external customers, I believe that sets the ground of finding that right balance between innovation and say incremental change or continuous improvement.

Sanjog Aul [00:08:38]:

So, Jeff, given what Rene mentioned and if I understood it correctly, we should not hold a stigma either against legacy or innovation. So like you mentioned, Jeff, in your example about that HR system, yes, we should have done it years ago, and maybe there was a reason why it wasn’t done because the payroll system or that employee self-service system was not present. It was really not making that big of a dent. So someone made a decision on not going that route. How are these decisions even being made? Is someone just saying I want to do something cool so automate my system so we start spending money on it? Is that what takes us out of legacy and at least keeps our systems modernized or is this really a business reason after every spend that you see happening?

Jeff Hutchinson [00:09:25]:

So in our case, we’re a roughly $16,000,000,000 global business. And that’s most company people say that’s a good sized business. But we’re actually a small fish in a big pond. Our direct competitors are $60,000,000,000, $120,000,000,000 and one even larger than that. So we don’t have the funds, the investments to just say okay, everyone gets to go do what they want to go do, even though there might be a very good business case for their unique needs. So what we actually have done is we had to put a little more discipline into the overall way we look at things. Because if we don’t put the discipline in, what we end up with is islands of processes, islands of automation, which people have talked about in the past, you end up with individual work cells or teams or whatever, maximizing their efficiency totally, but not realizing that the end to end processes, the end to end approach may actually be far less than they could be in the past. You know, we see a lot of this legacy customizations that were taking place. It’s very much geared back to how I can maximize my little kingdom that I have to do. So we’ve actually changed the approach and said, wait a second, yeah, there’s opportunities to bring new capabilities, new things to the table. And we actually look back to something of the past. If you go back into the late ’80s, early ’90s, and 2000s, there was a high emphasis on end to end processes, business process modeling, business process change, etcetera. And then there’s been a renewal of that when people have been talking about digital transformation and digital processes and it goes beyond my definition as I said, but this puts some renewed interest. What we actually start looking at now is say, okay, is that investment going to help move the needle for the corporation? Are we going to gain increased sales and market share? Or are we going to reduce our cost of operations and make us more profitable? If we are, how is that impacting the overall operation of the corporation? And then what enabling technology is going to help us get that get where it needs to get to? So that drives the technology decision a little bit toward the end, but not from point of view of not being involved upfront, but really puts the focus back into why are we doing it. We’re not doing it because it’s cool or we’re not doing it because we just want a lot of money to invest on new things. We’re doing it because we’re really trying to drive that growth part of the business. We’re trying to drive down the costs we have were more profitable on the other part of business or maybe faster to the market share or whatever the cases are. And that is that mixture of making those hard decisions at an enterprise level, working with the business units, working with the functions that is enabling us to take the investment limit that we have and be more competitive than our larger competition can be.

Sanjog Aul [00:12:54]:

Let’s take a quick break, listeners. We’ll be right back. And Rene when we come back love to touch on this maintenance cost that we know comes with the legacy systems and processes etcetera. And if you were to invest a whole lot in it, we wanna make sure that we get corresponding returns but there is also a report that after some time legacy systems start providing or giving diminishing returns. How do we invest the least we could and get the most value given the direction we are going so that the funds that we have could be put where the best returns are possible and hopefully in the innovation side versus keep pumping money into legacy systems. So what would that secret formula be? Let’s, listeners, please stay tuned. We’ll be right back and explore.

Sanjog Aul [00:15:44]:

Welcome back. So, Rene, we know that organizations have to bear heavy maintenance costs for legacy and in many cases the continuous improvement efforts. So what would be a good way to tackle the investments so that we get the least amount of infusion of funds for the most returns?

René Berend [00:16:10]:

Yes. Thank you. I think that’s a great question. First of all, I divide maintenance costs and change. So maintenance is a commoditized service, which we have to do, and IT management is supposed to do this at the most efficient way. And business people expect IT staff to do this, and this cost cannot be prevented. So maintenance has to happen. But then for change, this is another story. First of all, we need to have the discussion about a direction, a strategic roadmap. Where does the company want to go? What is the midterm plan, for instance, for any change or continuous improvement, and I think we discussed already a discipline, is to have a demand process in play. So every change request need to be justified. So the first step in that justification, I always call a worth analysis, sometimes called a benefit case. It doesn’t take long. It is a 2-hour meeting with relevant people to say, does this idea make sense? I’ve seen documents to justify change, which took weeks to produce. And when the head of the BU saw this, he said, are you mad? No way we are going to do that. So we spent a lot of time on creating a business case for something which executive management said, no way, this is a waste of time. So that worth analysis is a very important point for any change, incremental and even innovation. Innovation is a slightly different case where I come back later, but for incremental change, that is important. If we then say, well, it is a good idea, let’s then go into a business case, and one of the questions to ask in that business case is, does this change? Is this part can this wait until we have a strategic change ready? Or do we have to do this now because there is something critically needed in the business. We are losing money or we are having excessive cost. So a tactical change or an incremental change is absolutely needed before we go into a, say, into a strategic change. So I mean, that is for me the answer. Maintenance costs we need to do, change, we all follow a process whether or not it delivers the value for the business that we want it to deliver. And then tactical, if we can prevent it, we should. If we have a real issue, we then, for instance, we are losing money, we need to do it and then we agree. This limits the number of incremental changes enormously in my experience. And we can spend more time on looking at the innovative ideas, looking at strategic change, which moves the company, say, to a new place. Does that answer the question?

Sanjog Aul [00:19:56]:

No, it definitely does and I wanted to build upon it. So Jeff, when you go about looking at continuous improvement, pure legacy maintenance and innovation, let’s take these 3. Do you create very clear, isolated buckets and look at where do I spend money for me to get the most value or you have an isolated or rather siloed view of let me spend this money here, let me get the most value or let me save a buck wherever I can. What’s your portfolio strategy? Divide and conquer or look at it holistically?

Jeff Hutchinson [00:20:41]:

We look at it holistically, but I really like what Rene was saying, worth the worth analysis. Now we’ve done more of a business case approach in the past and we do do a small C money to get some upfront work to really try to better understand it. But we haven’t thought about it in the worth analysis and it’s a unique way I like the way he’s thinking about that and something I’m going to put some more time into. But we bucket within our investment areas, we bucket what we call run and change. And run includes maintenance, it includes the continuous improvement type that are small, the fix it type activities and those type of things. And then change has both the larger continuous improvements, those things that are more project based and it has the innovation type things that are also underneath it. Our goal we have requirement areas. There’s lifecycle requirement areas, cybersecurity areas, etcetera, that fall and run. It’s not just keep the lights on, but it’s making sure that we have a foundation out there to build upon. And sometimes I use the example of if you’re going to build a skyscraper, you can’t build a skyscraper on sand, it’s going to fall over. You have to have a solid bedrock. Maybe it’s not the best bedrock in the world, but it has to be at least sustainable enough to meet for what you’re trying to build. So we’re not necessarily an industry that’s going to have all the money to invest in areas, but we are one that has to focus does focus on making sure we have enough to keep the business enabled until we’re trying to go. But then when we look at the continuous improvement and the innovation, we actually balance the two. And when we try to balance the two, we do a like most corporations initially some type of bottom up build that comes in by our business units or comes in by our functions. And we spend the time going looking across through our teams, we have like a lot of companies have, we have a business partner team that’s a business unit focus and we have a value chain team that has the process and technology that goes across the functions. And when they’re looking at those, we actually prioritize them because no one ever has enough money to do and to go through. But we look at what’s going to again move that needle the best. What are we trying to drive and if it is an innovation approach that’s going to fundamentally make a big difference, fantastic, we’ll spend some more time. But it also goes back to what was referenced before, and I like, when he says, does the executive staff says no way to it? We’ve seen both examples. We had a situation not too long ago where the President of a business unit met with his leadership team and I was sitting there with him. And he said to them, Hey, guys, we got 2 choices. Our competition is changing. They’re becoming more aggressive. If we’re going to survive in the future, either we do continuous improvement with what we have today, or we do an innovative transformation and do things fundamentally different. What do you guys want to do? Do you want to nickel and dime this to death and see where we actually end up? Or since for a small, a small fish in a big pond, do you want to fundamentally make the difference? And if you do, that means we’re going to stop doing other things. We’re going to focus on this and actually invest properly with the leadership, with the other parts of the corporation organization. And across the board, the entire leadership team says, Yes, that’s the right thing we need to do. And it was about transforming them, and then how we, from an IS/IT point of view, enable that to take place. And we purposely did it from that mindset versus one more IS/IT project, just to help ensure that this is going to be successful this time, that the ownership, that the driving was enabling within the business units and the functions, but they fully recognize they can’t do it alone. That’s why we refer to each other as colleagues. We don’t refer to each other as customers, because together we can make each other successful. Independently, we will fail.

Sanjog Aul [00:24:55]:

Let’s take a quick break, listener. Yeah. Go ahead. Go ahead.

René Berend [00:24:58]:

Can I add something to that?

Sanjog Aul [00:25:03]:

Go ahead.

René Berend [00:25:03]:

If you look at innovation, there are 2 types of innovation, I always say. The first one is processes and practices, which are in one industry already standard, but in our industry, for instance, groundbreaking. I have a good example in the consumer electronics industry, where a fast moving consumer good pricing model was already around in the FMCG for maybe 20 to 30 years. In the consumer electronics, it was not. So for consumer electronics, that was absolutely innovative and groundbreaking. For these innovation ideas, it’s relatively easy to do a worth analysis because you have use cases. But then there is another type of innovation, which is what I call the change the world innovation, the car instead of the horse, for instance, as we said earlier. This one is more difficult for people in business to understand because you don’t know what you don’t know. So in that way, we created here a process with a third party, with a system integrator to a trial and fail fast mode. And that takes almost the element of the process worth analysis. You trial something very quick and you use that as the worth analysis to create a proper business case because our business leaders are often set in their way of thinking and don’t look beyond what they do or they are too busy. Everyone is extremely busy, they don’t have time to read a lot of articles on innovation. So it’s very hard for them to understand if a change the world type innovation is going to work for our type of business. And in that way, the trial and fail fast method is actually a very good method because it shows the potential with some evidence. I think that was a good extension on what was said before.

Sanjog Aul [00:27:33]:

Let’s take a quick break listeners. We’ll be right back. And Jeff, when we come back, I’d like to understand your shift in the mindset and the strategy because earlier circa 2000 or 2010 even, we were not moving as fast and digital or other types of disruptions in the way businesses are moving, the marketplace is moving, the customer requirements or demands are shifting wasn’t that as crazy. But now everything is fundamentally disrupted. So should we even think about continuous improvement or should we just start sunsetting legacy or aggressively work towards consciously sunsetting legacy so you compete with the digital natives? Otherwise, it’s gonna be before time before long we will see older enterprises who are set in their ways will vanish. I mean we have seen examples of that. What is being done and what is being thought in that regard so that you are becoming relevant while competing effectively with the digital natives in these coming years. Please stay tuned listeners. We’ll be right back.

Sanjog Aul [00:30:43]:

Welcome back. So looking at the disruption and the need to compete with the digital natives, should we even be thinking about continuous improvement? Should we be even thinking about cradling legacy if that’s going to make us irrelevant or create the risk of us becoming irrelevant? Jeff?

Jeff Hutchinson [00:31:08]:

Yes. Thank you. In our business, we make trains, passenger trains and we make planes, regional planes, turboprops and business jets. And our competition is, as I mentioned before, comes from 2 fronts. It comes from the larger corporations out there that you would know, but it also comes from startups. It comes from companies out there to have a vision, to have an idea and want to do things differently. So as we kind of think about ourselves as a business and also think about how we’re going to compete in that digital native world. Like a lot of corporations, we have excessive amount of legacies out there. We can joke like others that we run our businesses on spreadsheets for the wrong reasons. But we also have to understand that we’re competing against some businesses out there that don’t have the issues, don’t have the other parts we have to deal with. So the way we’ve kind of looked at it, and we use the definition a little bit different than maybe some other companies look at it, but what we’re trying to do is say, how do I improve our decision making? How do I enhance the way that I can make data driven decisions? How can I do them faster and more agile? How can I be more nimble? How can I get better intelligence out there? Or using the buzzword, how do I become an intelligent enterprise? And one of the things we have that the digital natives and the startups and others don’t have is we have a lot of data, a lot of information, and we have size and scale that they don’t have. But we fundamentally have to also look at and say, okay, how do I drive out value, how do I drive out non-value efforts so I can be more efficient and more effective? And if that means, in some areas, I need to think about the elimination of some of the legacy environments and change things, simplify it. You know, a big focus is how do I simplify our suite out there and really try to get to a point where I’m helping everyone drive that productivity across the board, not just by a function or business unit, but overall productivity. That’s the mindset of where we have to go into the future here and fundamentally make that change. I think about an old book out there, and the old book is Who Moved My Cheese? By Spencer Johnson. I think most of you probably have seen it already. Yes. Change happens. Anticipate it. Monitor it. Adapt to it quickly. Enjoy it. Well, we have to change. We need to adjust our cultures to be like startups. We have to adjust our own mindset so we can act and operate like that digital native. And that’s what we’re trying to do within our own corporation for the reasons I gave you before.

Sanjog Aul [00:34:29]:

So, Rene, when you look at how we are moving fast at this dizzying pace, and Jeff has also mentioned that they are committing to compete and be relevant in the future by shifting. What would make that shift become faster versus the rest of the organization just because of the sheer size or the inertia pulling us back? What can we do to really make that happen? I’m sure Jeff, you’re taking steps towards it but there are a lot of resistance for obvious reasons. So Rene, if you were to create a playbook for someone to become digital relevant or be digital now relevant, what would that look like given all the big legacy and legacy mindset and applications and processes in place? How would you get over that?

René Berend [00:35:35]:

Yeah. So actually, I don’t think it is impossible to do that. But what you need to do is, I call it cross fertilize the organization with people from other companies. So if you don’t hire people, if everyone stays at their place nothing happens. But if you get people in from other companies, listen to them, you create this open minded, communicative culture where ideas can get ground. So it is a cultural aspect which we need to change. And for doing that, you need a certain type of people into the organization to start having these discussions, it’s very important that the CIO and the leadership team of the IT organization is very, very close to the business, are partners of the business and have this open mindset in order to discuss these type of things, use cases of companies that changed. By the way, I would not suggest to put all your eggs on the digital world, because the company got big and was successful with what they did so far. Was it not IBM who in the 90s said the mainframe is dead and got into real trouble and it’s still around? Or copier companies who said the copier is dead because people scan and print. Actually, the reverse happened because everyone has copiers, there’s printers now. I mean, don’t throw away the good things of your existing company, but you have to do both. You have to bring in new ideas. And I always say here in this company is you have a lot of disruptive companies in the recruitment industry. But we could use that disruptive this disruption to become more competitive, because we have more power than a lot of these start ups if we have the right mindset to make things happen. And I think that is it. But you need people who can bring that message across, who discuss it. So it is about getting people in the organization to change that culture. And it depends how big your organization is. But if we have an organization of 8,000 people, it is small enough to have say 20 or 30 people across the organization who have a different mindset and can bring that message across to our decision makers.

Jeff Hutchinson [00:38:51]:

So, Jeff I’ll just add to that. It’s Jeff here. I fully agree you need that mix of the old blood and the new blood together. You need people who can think both as is, understand what we’ve done in the past, learn from that, but have the to be. And that change in that culture and that mixing, and one of the key things we found is you’ve got to find individuals who like change. Even within our own IS/IT organizations, and that’s one of the things you’ve got to do is fix your own shop first. But even within our own organizations, there’s people who like to do change, but there’s also people who don’t like to be changed. And how do we get those individuals out there who are open to be the catalyst for it, to be to help facilitate and drive it through. That’s going to help drive across the board. And how do you need to find those also within the business units and functions that you can latch on to or people who really are interested in making that into your future. So that whole mixture of the old and the new is so critical to making your organization successful in the future.

Sanjog Aul [00:40:04]:

So Jeff, question for you. If I gave you a scenario or an environment where there are no constraints, would you have still embraced legacy or would you always think legacy could be removed would give you the breath of fresh air and allow you to think fresh? Because that mindset or in absence of that mindset we would behave differently and we will invest differently and our portfolio will be different.

Jeff Hutchinson [00:40:38]:

So, one of the things I use a lot is the art of the possible. And as we sit down with the teams and I work with them, I constantly ask them to think outside the box, to think what that are the possibility is. But then, to come back to the reality of life. You can do so much change at once, and if you attempt to change too much, you still have to get product out the door, or whatever services and offerings that you do, and you add risk to it. So, no, I would not get rid of if I had unlimited pocketbook, I would not get rid of all the legacy, but I would evaluate the legacy to say, Okay, which piece of it can I go look at that’s going to fundamentally move that needle? Which piece of it is going to allow me to drive more revenue quicker or be more efficient in profitability? And focus my efforts on that. Because the difference would be if I had no business and I was creating an environment first and then starting a business, fine. But people have to change the way they work. They have to change the way they operate. It’s not about delivering new systems. It’s about the sustainable adoption of solutions and that’s a big part of our role is to get people to really understand how they sustain how you’re going to ensure that they adopt your solutions and sustain to it. So it’s that journey management, that culture management, and we’re all human, that’s the hardest part to it.

Sanjog Aul [00:42:20]:

Let’s take a quick break, listeners, we’ll be back. And Rene, when we come back, love for you to share a good way to manage both innovation and continuous improvement in a fashion that it maximizes outcome for both because you’ll have to structure your organization in a certain way to foster innovation and then to some extent similar or there would be a different way to structure it for continuous improvement. Could these activities be done in such a manner that you could cross leverage the mindset, the resources, the abilities of people that you have or you need to work on that bimodal or like other ways of creating your structure of the organization which will keep them as two different camps. What would make sense? What has made sense when you have tried to do it in your organization? So listeners, please stay tuned. We’ll be right back and explore.

Sanjog Aul [00:45:14]:

Welcome back. So, Rene, talking innovation and continuous improvement, how would you structure your organization so that you get the most value for both of these areas? And if there are ways where you could cross leverage any resources or activities or people that you have at your disposal. 

René Berend [00:45:39]:

Yes. I think this is one of the most difficult things in IT organizations. If I simplify it by saying, you have staff that work on the old world and you have staff that work in the new world. And that is a difficult thing. From the outset, it has to be made clear to staff that there are opportunities to get involved in the new world, even if they work on maintenance or continuous improvement in legacy systems. Even if they are necessarily not be part of the future, they still have to get the feeling that they are delivering value for the business. So I think to do that there are a couple of change management instruments to do that. You let them train, increase their market value, things like that. But it’s very important to earlier, try trial and fail fast. I believe real innovation can come from technologies where we don’t have any capabilities. So we need to have a third party potentially to help us and give us access to technology and to staff with technical skills that we don’t have in our own company. So for true innovation, the change the world innovation as I call it, there we need to work with a partner. And internal staff manage their partner and are often quite excited to be able to get access to staff who work on these type of innovations. But it is for me it’s one of the more difficult ones. If you put someone in say what I call the old world, they want to be in the new world and you have to manage that situation with every individual different.

Sanjog Aul [00:48:04]:

So Jeff, if you’re looking at your own organization, what all have you tried in this regard? You know, a lot of people talk about this bimodal and other approaches to structure organization. Have you played with it?

Jeff Hutchinson [00:48:17]:

Sure. Actually, numerous times. And I actually don’t believe in bimodal. I believe in multimodal. And what I mean by multimodal is, we set up our operations, our teams pretty much by value chain functional orientation. So, they go across different business units, they go across different areas. If I had taken a bimodal mindset to it, what I’d end up having is the haves and the have nots. And for example, we created a team not too long ago where that team was set up to do the leading innovation, the leading ideas, etcetera. And intent was that they would be an incubator, that they would actually go out there, work with our more traditional teams, and bring new concepts, new ways of doing things. What we found out was happening is they were starting to separate. They were because of the demand, what they were trying to do was great, but they weren’t integrating, they weren’t bringing the concepts back into the rest of the organization. So, we’re almost starting to create two different mindsets here, two different teams. And we found a better way of doing it was to take that concept, that innovation increment concept and embed it into the deliverables of each of our team. Of course, I also believe in the try and fail fast type approaches to it. But we also said to them, we want you to go out there. We want you to network with others, talk to other companies, understand what they’re doing and going on. IS/IT professionals meet, network, and talk a lot. We’re very open with each other. We actually have a company in the U.K. that’s in a totally different industry that we sign NDAs between us and them. We have no business relationship with each other. But we both found out that we were trying to focus on something and develop a concept out there that we could leverage each other. Now, that type of networking works out great and then we supplement the same way others do with third parties. But by also getting our folks to see and do things, we’re not totally reliant on just the third parties to do it. We’ve established an innovation fund, so we have actually each year money that’s focused just for doing innovation type work, but we open it up to everyone, so that we actually allow the teams to say, Hey, I’ve got an idea I want to try here. Yeah. Go through, get some quick approvals, and actually try to move it through move forward. So, my recommendation back is don’t separate it, treat it by multi, but incorporate it. Make it part of everyone’s lifestyle. Make it part of the culture that you’re trying to build.

Sanjog Aul [00:51:05]:

I have only 30 seconds. If I were to ask you, Rene, what would be your message to the people who are trying to balance continuous innovation continuous improvement and innovation? What would you suggest to them? 

René Berend [00:51:21]:

For me it’s very clear. IT leadership has to be completely integrated and be a partner with business leadership. They have to work together. Recruitment, where I work now, is a people’s business and a technology business. It doesn’t work anymore without technology. And that is where IT and business have to be working very close together. And if you focus on that, really being a true business partner, then I think the right topics will be discussed and decided.

Sanjog Aul [00:52:06]:

On behalf of the show and our listeners, I’d really like to thank you both, Rene and Jeff, for sharing your thoughts on how organizations can balance the legacy, the continuous improvement, and the innovation to get the most for their respective companies. Thanks so much again.

René Berend [00:52:22]:

Thank you. You’re welcome.

Sanjog Aul [00:52:24]:

And, listeners, please like us on Facebook. Search for CTN CIO Talk Network. Be sure to follow us on Twitter and join our LinkedIn group. Thank you again for listening to this segment on CTN. This is Sanjog Aul, your talk show host. Till next week. Take care, and God bless.