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Dawn Of The Idea Czar

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DQI Bureau
New Update

Billy Edwards' colleagues at Advanced Micro Devices have

called him their utility infielder. AMD's human resources chief Kevin Lyman

calls him the chipmaker's agent provocateur. Officially, though, Edwards is

called AMD's chief innovation officer, a newly created role for this senior

vice-president.

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Although Edwards, 50, has a PhD in materials science

engineering and has worked around semiconductors for much of his career, he has

also headed up strategy at the Sunnyvale company, run a startup, and worked as a

consultant for The Boston Consulting Group. So when AMD formalized a role that

would lead its innovation effort last September (or, as Lyman describes it,

“put an 'X' on the back of someone to consciously drive it”), Edwards'

diverse experience, gregarious personality, and penchant for disrupting

traditional ways of thinking fit the bill. “A chief innovation officer needs

to be this blend of marketer, technologist, strategist, and business person,”

says Lyman.

In other words, Edwards' new role goes far beyond

dreaming up the next chip iteration for AMD. Rather, he'll be spearheading

audacious projects that don't neatly fit into any of the company's current

functions.

New Hybrid



A thirst for internal growth across Corporate America has made innovation a

critical management mandate. As a result, the initials 'CIO' have

increasingly begun to refer not to chief information officers, but to yet

another C-suite label, the chief innovation officer. That and similar titles,

such as vice-president of innovation, are popping up in companies from Citigroup

to Coca-Colato health insurer Humana. Titles of this magnitude send a clear

message to the organization: Innovation is an urgent priority and someone should

be accountable for it. Most of the large executive search firms are reporting a

dramatic uptick in requests for such people.

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While companies have long had VP-level scientists running

research and development, or marketers steering new product development, these

innovation chiefs are a new hybrid breed. If they don't directly report to the

chief executive, they typically have direct access and, like Edwards, their jobs

are more broadly defined. As companies continue to figure out just what

innovation is, managers charged with running it have seen their responsibilities

evolve. Rather than encompass only new products, innovation has come to include

everything from finding new business models and fresh ways to glean customer

insights, to shaping a more creative corporate culture.

The structure of the role varies widely: Some CIOs have

sizable teams while others are more like internal consultants, and the job may

be most closely tied to strategy, marketing, or R&D. Tierney Remick, a

managing director with executive search firm Korn/Ferry International, says most

of the innovation officer-led teams she's seen have started small and grown

over time as the responsibilities of the role have expanded.

That's the case at Humana, which named its chief medical

officer, Dr Jonathan T Lord, to the newly created post of chief innovation

officer in 2001. Initially, Lord's approximately 15-person team was formed to

find new innovations for Humana's core insurance products. “It was a smaller

team, a smaller scope, and a narrower agenda,” says Lord.

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But over time, Lord's team, which is housed on the

company's “Innovation Center” floor in its Louisville headquarters, has

itself become a corporate function. The team has swelled to 150 employees, many

of whom Lord has recruited from places like General Electric Co (GE ), Procter

& Gamble Co (PG ), and the defense industry, with an eye toward bringing in

outsiders' perspective and expertise. Lord now keeps a hodgepodge of corporate

initiatives under his umbrella. Among them: ethnographic consumer research,

external partnerships, and, beginning last year, mergers and acquisitions.

Beyond

R&D




How to make chief innovation officers effective:

Look

For Track Records




Don't be tempted by prolific idea generators with no history of
execution. Knowing how to implement new products or processes and how to

navigate an organization matters more.

Hire

Persuasive People




Many CIOs will have direct reports that are in different functions, such
as marketing or operations. Rallying those folks to the innovation cause

is essential for success.

Give

Them Access




CIOs will falter without true top-level support, especially if culture
change is part of the job. “There are just very few people who can drive

that without the ear of the CEO,” says Heidrick's Stevenson.

Use

Different Yardsticks




Innovation officers won't gain credibility unless they show results. But
they'll need extended time frames, cooperation, and more tolerance for

failed experiments.

Carve

Out Space




Humans transformed a floor of its headquarters for its innovation team.
Managers come and go, but changing the actual space of the office sends a

clear signal of importance.

As Humana shows, there seems to be a place for innovation

czars at companies of all stripes, but they are particularly hot in the food and

consumer-goods industries. P&G, Kellogg, Hershey, Wm. Wrigley Jr, and Newell

Rubbermaid have all added high-ranking innovation execs to their lineups in

recent years.

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'Silver-tongued'



According to headhunters, candidates with marketing backgrounds are filling

more of the newly created CIO positions. Although some level of technical

knowhow-or a lot, at a tech company such as AMD-confers credibility in this

cross-functional gig, CIOs have to be able to sell high-risk new ventures

throughout often-skeptical corporate fiefdoms. “Marketers are typically pretty

silver-tongued,” says Greg Welch, who heads up the marketing officer practice

for executive search firm Spencer Stuart.

Whether the CIO is a battle-tested company vet or a

fresh-thinking outsider, idea generators with little experience implementing

them aren't right for the role. That's one reason why Yankee Candle. chose

veteran brand manager Rick R Ruffolo when it expanded its chief marketing

officer role to link R&D, brand strategy, and marketing. Before arriving at

Yankee Candle in September, Ruffolo had launched new product lines for Limited

Brands' Bath & Body Works and managed brands at SC Johnson & Son and

P&G. Now the product development and marketing departments report through

Ruffolo, whose business card reads senior vice-president of brand, marketing,

and innovation.

If that title's a mouthful, consider the multifarious

duties that confront Ruffolo: establishing a more disciplined way to evaluate

and execute ideas, meeting with operations about innovative manufacturing

processes, and scouting global markets for new devices to deliver Yankee

Candle's fragrances. “If it was just a purely innovation role, I might just

run after all these different gadgets,” says Ruffolo. “But by linking it to

a senior management role, it's not innovation for the sake of innovation.”

For Ruffolo, the chief innovation post meant a higher level

of seniority; for Lord, becoming a CIO was largely an expansion of his

responsibilities. Still, the CIO job is hardly an established rung on the

standard-issue corporate ladder -and the risk of failure is high. But able

candidates are drawn by the position's high visibility and the rewards that

could accompany any successes.

By Jena McGregor,



with Amy Barrett in Philadelphia

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