6 roadblocks to IT innovation

CIOs now list innovation as the most important trait they need to bring to their role, according to a 2024 survey by professional services firm Deloitte — ahead of delivering top-line value and serving as change agents, two endeavors that require innovation to facilitate.

Meanwhile, Foundry found in its 2024 State of the CIO Study that 88% of CIOs said their role has become more digital and innovation focused, up from 85% in 2023.

Innovation, however, is not easy, as CIOs, their IT teams, and their organizations face plenty of obstacles that can slow or stop progress.

Here, CIOs and IT innovation leaders share five common roadblocks to IT innovation.

1. Legacy tech and all that goes with it

Legacy systems and technical debt top the list of common innovation roadblocks.

“Many organizations still depend on legacy technologies that are costly to maintain, inflexible, and not compatible with modern, agile development practices,” says Christopher Gilchrist, principal analyst at Forrester Research. “Legacy systems and bureaucratic structures hinder the ability to iterate and experiment rapidly, which is critical for developing and testing innovative solutions. Slow progress frustrates teams and discourages future experimentation.”

Those, though, aren’t the only ways legacy tech can hurt innovation.

Roland Carandang, global leader for innovation at consultancy Protiviti, says the fact that organizations “don’t know what they’ve got” in and around those legacy systems can also stymie IT’s efforts to innovate.

“Fundamentally people don’t understand how their business activities — the processes, services, and customer journeys — are tied to the technologies,” Carandang says.

That lack of understanding fuels a fear of decommissioning and replacing old systems, as IT and business leaders see a high risk of significant snafus when they don’t understand all the complexities and connections within their legacy tech, he explains.

Consequently, even teams that are motivated to innovate feel pressure to move slowly and carefully lest any advancements they make cause unintentional and possibly catastrophic business disruptions.

As dire as the situation may seem, Carandang says it can be managed. He advises strong project portfolio management (with detailed mapping of processes), supported by the use of discovery and asset management tools, to gain better insights into the intricacies and integrations within the organization’s tech stack.

“It’s about connecting dots to give people the confidence that their innovation initiatives will succeed,” he says.

2. No formal systems for innovation

Innovation doesn’t happen by happenstance, says Sean McCormack, a seasoned tech exec who has led innovation efforts at multiple companies. True, someone might have an idea that seemingly comes out of the blue, but that person needs a runway to turn that inspiration into innovation that takes flight.

That runway is missing in a lot of organizations. “Oftentimes there’s no formal process or approach,” McCormack says.

Consequently, inspired workers must try to muscle through their bright ideas as best they can; they often fail due to the lack of support and structure that would bring the money, sponsors, and skills needed to build and test it.

“You have to be purposeful with how you approach innovation,” says McCormack, now CIO at First Student, North America’s largest provider of student transportation.

As McCormack notes, there are multiple strategies to support innovation. Committing a certain percentage of workers’ schedules to innovation, creating innovation labs, and holding innovation challenges are a few options.

Taking a purposeful approach enables innovation in several ways, McCormack explains.

First, it prioritizes promising ideas and funnels resources to those ideas, not weaker proposals. It also ensures promising ideas get attention rather than be put on a back burner while everyone deals with day-to-day tasks. And it prevents turf wars between groups, so, for example, a business unit won’t run away with an innovation that IT proposed.

McCormack has set up innovation councils where he has worked, including at First Student. He chairs the council, and business unit leaders serve alongside him; they use a charter to guide how they select and fund proposals as well as how to turn promising innovations into pilots and then formal projects with clear business objectives.

“We pair IT and business together so everyone gets credit and feels like it’s a collaborative effort,” he adds.

3. Little IT outreach or collaboration with other departments

It’s not just the lack of formal systems that can hamper innovation. Lack of IT engagement with other departments can similarly stunt the ability to capture and advance novel ideas.

“Without that collaboration with others, IT might never get their ideas and [as a result] would not be able to leverage the insights of those who are closest to problems,” McCormack says.

McCormack knows firsthand the value of IT and business working together to encourage innovative thinking.

As former CTO and head of digital at Harley-Davidson Motor Co., McCormack ran innovation challenges that enabled workers to present ideas, get initial support to refine them, and compete for resources to advance them. (He also ran innovation challenges for external business partners to pitch ideas.) The winner of one such challenge was an HR analyst who proposed an app for multiple people to plan rides together, a proposal that spurred the development of multiple popular Harley-Davidson apps.

McCormack brought innovation challenges and other collaborative ideation processes to First Student, too, which also has yielded wins.

One win is the creation and launch of a custom software solution known as FirstAlt, which enables districts to provide safe, reliable transportation options for students with special needs, students experiencing homelessness, and out-of-district students via a fleet of small-capacity vehicles from existing local transportation companies. FirstAlt, which came out of collaborative sessions between McCormack and the company’s chief commercial officer, won the 2024 Technology Strategy Impact Award for North America from Forrester Research.

4. A focus on the technology, not the outcome

Despite years of efforts to defeat the so-called “shiny object syndrome,” IT teams can still get entranced by new technologies and pursue tech implementations without any clear business goals in mind.

“Anytime there’s an evolution of technology, AI being the one we’re living through now, we get enamored. We then lose sight of the business outcomes we need to achieve,” says Ryan Downing, vice president and CIO of enterprise business solutions at Principal Financial Group.

Gilchrist explains how this hurts innovation, saying, “Organizations sometimes jump on new technologies simply because they are trending, without a clear strategy or understanding of how they support the business’s long-term goals. This can lead to wasted resources and initiatives that fizzle out before delivering any value.”

Although the excitement of emerging technologies can run high, Gilchrist says CIOs can keep themselves and their teams on track by ensuring their work, including their innovation efforts, are aligned with organizational objectives.

“Clearly communicate how IT initiatives support the broader business strategy,” he says.

Downing takes a similar approach, especially when innovating with new technologies. He says he maintains a “clarity on the problems that need to be solved” and develops ways to determine the best technology to solve each problem. Additionally, he fosters collaborations that pair the technical expertise and enthusiasm of his IT workers with the business knowledge found in the other functional areas so together they “can build a better mousetrap that delivers measurable outcomes.”

5. Longstanding cultural and organizational issues

Shiny object syndrome isn’t the only longstanding issue that stymies IT innovation. Cultural resistance to change and siloed teams are other such issues that continue to slow or stop innovation, says Deborah Golden, US chief innovation officer at Deloitte.

“Some roadblocks are as familiar as they were decades ago,” Golden adds.

Gilchrist similarly sees many familiar cultural and organizational issues stunting innovation work. He, too, lists siloed organizational structures that lack the cross-departmental collaboration required for innovation.

He says competing stakeholder agendas can also be a problem. “For instance, security teams may prioritize locking down data access, while product teams may push for open systems to accelerate new development. This conflict can create bottlenecks that impede progress,” he explains.

Additionally, cultural inertia also blocks innovation in some IT departments. “Employees may be resistant to new processes or technologies, especially if they perceive these changes as threats to job security or as adding to their workload without any visible short-term benefits,” Gilchrist says.

Similarly, budget constraints and a focus on the short term can kill innovative spirits. “IT initiatives are often perceived as cost centers rather than strategic enablers. A focus on reducing costs and achieving immediate results frequently limits the willingness to invest in long-term transformative projects,” he says. “This short-term approach stifles strategic initiatives that require time to bear fruit.”

A lack of skills — specifically in cloud computing, AI, and data analytics, restricts innovation potential as well. So do inefficient governance and bureaucracy, as lengthy approval chains and inflexible compliance requirements slow decision-making and impede progress on projects.

Gilcrest also lists the over-reliance on a few key individuals as an impediment. “When innovative projects depend on the enthusiasm and expertise of a small number of ‘champions,’ organizations risk losing momentum if those individuals leave or shift roles,” he says.

To overcome those multitude of issues, Gilcrest advises CIOs to “champion a cultural shift towards innovation, emphasizing that innovation is not synonymous with job loss.”

They should also “implement innovation incubators or cross-functional teams for experimentation, [which] can help build momentum and encourage a more entrepreneurial mindset.”

He advises CIOs to embrace continuous training of their IT teams; agile and DevOps practices to foster a fail-fast, learn-fast environment and cut bureaucratic red tape, thereby speeding the realization of innovative solutions; and internal multidisciplinary innovation councils that can help identify barriers to innovation and work collectively to remove them.

“Additionally, embracing ecosystems and partnerships can be transformative,” he says. “By collaborating with startups, technology vendors, or industry consortia, CIOs can leverage external innovation to overcome internal constraints and create new opportunities that might not be feasible within the organization alone.”

Golden predicts that current business conditions could help put an end to these issues, as more organizations and the workers themselves recognize that “standing still is falling behind.”

“With industry convergence happening and more things coming together — particularly AI and customers wanting [everything] faster, cheaper, and better — organizations know they have to adapt at a faster pace,” she says. “This will push organizations and IT to not fear disruption. With AI and generative AI, we’re seeing a democratization of access to innovation. That allows more and more people to be able to manipulate in a good way and to innovate. And that means it’s easier to change and therefore more people see it, it’s more human-centered, and people are more easily able to accept and adapt to change.”

6. An outdated view of CIO success

Experienced IT innovators and innovation consultants agree that CIOs who want to innovate must first prove they can run their day-to-day operations flawlessly. But some CIOs focus so much energy on building a well-oiled IT machine that they fail to devote enough attention to building up innovation capabilities within themselves and their teams.

“There is this group of CIOs who might be brilliant IT managers, who manage budget and time, and can run the machine. Then there’s the smaller group of CIOs who are able to manage change. They’re creative and empower their teams to ideate. They know how to partner with third parties. They’re willing to take risks and be courageous and try new things. And by communicating that and walking the walk, they inspire their people,” says Bernhard Schaffrik, principal analyst at research firm Forrester.