A chief innovation officer (CIO) looks at internal systems and external opportunities to see how a company can boost profits implementing new ideas and operating in unconventional ways. The inclusion of a CIO position at the executive level demonstrates an increased commitment to operating at the forefront of the industry in a leadership role, despite the fact that the concept of innovation has long been part of the corporate lexicon. A CIO creates a strategy to identify and investigate opportunities, as well as the evaluative expertise to balance the risk of being a forerunner with the potential gain.
The chief innovation officer position was created in response to the technological revolution that ushered in the twenty-first century and altered the business-to-consumer landscape dramatically. The corporate playbook has always included innovation as a goal. No business wants its products or operations to appear stale or obsolete. Globalization of markets as a result of widespread Internet use, an increase in untapped opportunities as a result of technological advancements, and a shift in the marketing paradigm as a result of increased two-way customer interaction have given corporate innovation a new sense of urgency. Many companies have decided that assigning someone to specifically drive the process is the best way to embrace the perceived 21st-century mandate to “innovate or die.”
Corporate innovation was largely functional in the past. It was focused on making small changes to brand strategy or operations, as well as spotting industry breakpoints or breakthrough opportunities. Those responsibilities still apply to the chief innovation officer, but the more important aspects of the job include developing a corporate culture of innovation that will allow the company to remain competitive in the face of rapid market changes. The CIO collaborates with employees to define and implement an innovative work methodology that allows for personal expression.
More importantly, the chief innovation officer has a greater responsibility to look for opportunities for innovation outside of the organization. The CIO creates strategies for innovation in three areas: the Internet, social media, and sustainability, which are three of the major forces driving digital globalization. Whereas in the past, production and operations were the primary focus of corporate innovation, as barriers between businesses and consumers around the world fall away, marketing has become the canvas for innovative approaches.
No company can afford to chase new opportunities indiscriminately, as important as it is for a corporation to internalize innovation and identify new opportunities. A chief innovation officer evaluates opportunities using expert analysis and professional judgment, weighing the risks and benefits. Because the CIO is a key voice in determining the company’s direction, the position has a significant strategic planning component.