InformationWeek 500: A Year Of Relentless Innovation
Despite economic challenges, this year's InformationWeek 500 companies had the vision and guts to keep trying new ideas.
It's the first half of 2009, and unemployment's rising to a 26-year high of 9.5%. Sound like the perfect time to launch an aggressive technology-driven product?
It was for Progressive Insurance, which kicked off its "Name Your Price" Web site tool, letting customers build their own insurance policies, starting with what they think they can afford. It was for Coca-Cola, which tested a prototype fountain drink dispenser IT developed over two years with the company's R&D team, letting consumers mix a variety of new flavors while aligning Coke with a select group of fast-food restaurants to analyze buying data and manage inventories better. And it was for CME Group, the world's largest derivatives exchange, which partnered with Brazil's top exchange to give traders electronic access to CME products, expanding CME's global presence.
There's a thread that runs through the companies at the top of this year's InformationWeek 500: relentless innovation. In the 21 years that we have ranked the nation's business technology leaders, none has provided as many obstacles to innovation as this past year, with its ferocious recession. This year's top InformationWeek 500 companies stand out for keeping the pressure on for new ideas that drive business results. In our ranking--and our company profiles, industry insights, and "great ideas" exchange--the InformationWeek 500 celebrates those with the vision and guts to keep innovating.
The top InformationWeek 500 companies also show how critical the CIO is to delivering boardroom-level strategic priorities, working with the CEO and business unit peers to push out new products, drive sales, and free up cash. The IT leaders at Cincinnati Children's Hospital are an example, as they delivered an online collaboration portal as a key part of the hospital's work with other hospitals to treat fetuses in the mother's womb. That ties directly to its strategy of differentiating itself by leading in niche areas of medical expertise.
Results With Less Money
Numbers gleaned from our rigorous InformationWeek 500 questionnaire tell part of the story behind the companies' strategies.
In IT spending, there's been a massive downshift in just a year. In 2008, 62% of InformationWeek 500 companies expected their IT spending to exceed 2007 levels. This year, just 37% do. The ranks expecting to cut spending more than doubled, from 20% to 42%. That's to be expected when revenue is down almost across the board. In fact, at 2.7% of revenue, IT spending across InformationWeek 500 companies is stable compared with last year.
The most interesting data points usually are the ones that suggest divergent strategies--where there's no clear consensus around the best strategy. Surprisingly, that's the case when it comes to IT spurring new products and sales growth, which the majority of InformationWeek 500 companies don't see as a top priority.
That low priority isn't just a product of the recession. The percentage of companies that consider introducing IT-led products and services as a priority remains essentially unchanged this year from last, cited by 37%. Applying technology to produce a new revenue stream is a priority for just 14% of InformationWeek 500 companies. Nearly half of companies don't consider new products or revenue streams an IT priority.
Still, almost three out of 10 InformationWeek 500 companies have patented, trademarked, or copyrighted one or more of their IT or IT-driven processes or products in the past 12 months. Among the trademarks: a process improvement methodology, a converged networking architecture, and the IT infrastructure for local offices.
General Motors has patented an e-mail notification system that would draw on data from an actual vehicle and send a subscriber a message with the latest information, including any conditions requiring maintenance or repair. The Hartford insurance company has applied for patents on pure IT innovations--a system for load balancing and testing software and hardware, a dynamic file transfer and scheduling system, and a complaint-tracking system.
More predictably in a recession, however, the top priority for IT is improving business efficiency (60%) and cutting IT costs (47%).