Is SVM A Barrier To Innovation?

As many readers know, I have a strong interest in understanding the practical realities of innovation and want to help companies define what that "buzzword" means -- what it is, who manages it, and why it's important (see my just-published report on the ecosystem of innovation services providers). 

I believe Sourcing and Vendor Management (SVM) can and should play a critical role in the innovation process. However, my biggest disappointment when I speak to many technology vendors, IT professionals, and business users is when they tell me that they avoid working with SVM when purchasing (or in the cases of vendors, selling) a new technology. Fairly or unfairly, they see SVM's involvement as a bureaucratic stumbling block that will stifle their ability to move quickly or pick the technology vendor they want. For these people, SVM acts as a barrier, not an enabler, of innovation.

I’ve written before that this view is short-sighted: we know that SVM can play a pivotal role in protecting the long-term interests of the organization, SVM is a critical part of the technology purchasing process, and there are plenty of reasons to believe that the power of SVM organizations will only grow in the future.  To some of the more progressive SVM organizations, contributing to businenss innovation is an even more important priority than cutting costs.

 But I also see three primary areas where SVM needs to do more to enable innovation:

  • Participating in new technology adoption. SVM professionals may not be the primary stakeholder in the new technology adoption process, but they can play a critical role in ensuring the new technology works effectively over the long term.   
  • Managing innovation from third-party service providers. If you believe that most organizations will do more work with third-party technology suppliers in the future (a trend supported by the importance of Innovation Networks), someone must have detailed knowledge of the landscape of innovation suppliers. That responsibility could go to a Chief Innovation Officer -- but SVM is also uniquely positioned to play this role -- and may have an even stronger sense for how to manage these important supplier relationships.
  • Controlling increasing levels of self-provisioning. As workers become “empowered” with social technology, cloud computing, pervasive video, and smart mobile apps, many companies will have to adjust traditional risk-tolerance levels and define guide acceptable use policies. SVM understands organizational risk and can define when self-provisioning needs to be controlled with a formal sourcing policy.

This blog post is an active request for your feedback: SVM professionals, how do you contribue to the innovation process? Have you played an active role in sourcing a new technology or brought unique capabilities to the table? Do you communicate your innovation contributions internally? What roadblocks or internal barriers do you face? Please contribute your comments, and I will incorporate them into future blogs and research.

Finally, as part of my new technology research, I am working on a research piece about SVM’s experience with social/collaboration tools and technologies.  If you have played a role in sourcing these technologies and are willing to share your experience with Forrester, please let me know.  I already have several best practices to share in upcoming research and at Forrester's Sourcing & Vendor Management Forum 2010!  

Comments

SVM and innovation

I wold agree with this that many SVM organizations are focused on day-to-day transactional results, rather than on developing and nurturing innovative relationships with their suppliers. We captured this progression and best practices to support it in the eSOurcing Capability Model for Client Organizations - SVM organizations at higher levels of capability focus on value management, collaboration and innovation.