Accounting and Innovation - Isn't that an Oxymoron? Rick Rayson, Managing Partner, Orange County, Deloitte and Touche LLP, doesn't believe so. As a matter of fact, Rick tries to convince you otherwise - even goes as far as making you believe that accounting innovation can be "sexy". Well, sort of!
I had the first-hand opportunity to meet and hear Rick speak eloquently at last week's University of California, Irvine, Paul Merage School of Business hosted Dean's Leadership Circle event. Rick was the keynote speaker, introduced by the charismatic Dean of the UCI Business School, Andy Policano. I also spent some time with Rick after the event and was able to gain some real world insights.
Rick spoke about "
Strategic Innovation at Deloitte". And he brought home many key points on what drives innovation at Deloitte, and how innovation drives business. Deloitte is a worldwide organization consisting of some 147,000 employees (talent), with offices in more than 140 countries, aggregate revenues of $23.1 billion in fiscal year 2007, and serving more than 80% of the 2007 Fortune Global 500.
Deloitte's marketplace competitors include Accenture, PriceWaterhouseCoopers, KPMG, Ernst & Young, Mercer, Towers Perrin, and IBM (NYSE: IBM). IBM is one of the
Top 20 Innovators of The Innovation Index.
Why is Strategic Innovation imperative at Deloitte?It has to do with achieving Deloitte's vision:
To be the First Choice of:
* The world’s most coveted talent
* The most sought-after clients
In his speech, Rick addressed how most product companies innovate by filtering the exceptional opportunities from the utterly raw and mundane (
unblocking creativity and innovation), by managing various levels of uncertainty and investment requirements towards creating new innovations while mitigating risks (
process innovation), and by looking at the "horizon perspective" as created by Karl Ulrich, CIBC Professor, Wharton School of the University of Pennsylvania (
six ways to find innovation).
Professional Services InnovationAccording to Rick, "Professional service firms like Deloitte have enjoyed recent macro economic changes brought on by extraordinary technological and regulatory developments such as the ERP, reengineering and Y2K craze of the mid to late 90’s and the requirements of Sarbanes Oxley legislation and regulations since 2002. The question really is “
What’s Next”.
A key part of Deloitte's strategy is to develop new services, new ways to serve our clients and new ways to attract, develop and retain the talent we must have for this growth." This is Deloitte's Innovation and Creativity strategy to match its bold vision.
"
To develop new services, new ways to serve our clients and new ways to attract, develop and retain the talent we must have for this growth"
Three Investments are paramount to Deloitte's success: New Services, New Ways to serve, New Ways to growing talent
Rick articulates and simplifies this key Deloitte strategy further and ties it back to Deloitte's vision:
Deloitte has an urgent need to innovate on two fronts:
* In our services to clients (for their often unusual or difficult problems), and
* In our internal talent management and execution (while facing a shrinking talent pool and competition to recruit and harness the best talent).
Two forces drive the need for innovation at Deloitte:
* The need to provide outstanding client service, and
* The need to maintain a pool of top talent to provide that service.
"Edge" Drives InnovationAccording to Rick, Innovation at Deloitte is driven by the thousands of talented people working at the “edge” on client service engagements. Deloitte innovates by harnessing innovation that happens at the edge, bringing it back to the core, and then pushing it back out to the edge. Compare this to product companies where innovation is driven at times by the core.
Deloitte consultants continually think of new ways to help solve their clients’ business problems by leveraging thousands of experiments in the field. Innovation for Deloitte is about
accelerating the process of finding and refining good ideas at the core, and then pushing them back out to the edge – speeding up the process of turning personal innovation that happens in the field into institutionalized innovation that can be systematically delivered to our clients.Deloitte recognizes challenges to this "Edge" model. Specifically, on how to find ways to efficiently and effectively commercialize the ideas happening at the “edge.” Deloitte has created Talent Innovation centers, and Strategy, Research and Innovation Groups, Innovation Quests, and Centers of Excellence as part of the
Client Innovation Services to create game changing innovations.
One of the interesting creations is the
Enterprise Value Map: a tool that gives a comprehensive view of all the drivers of value in an organization. It has now morphed into a comprehensive Value Map that all Deloitte clients benefit from.
Talent InnovationDeloitte has tried hard to create a "youthful" yet "energetic" image of a company on the move towards hiring new talent, by developing innovative approaches to the attraction, retention and development of key talent. From a different approach to career management, to dealing with generational differences, to women and diversity needs, and fostering a culture of learning and coaching - Deloitte does all of the above to harness world class talent. Deloitte consistently ranks in the 100 best places to work, and 50 best places to launch a career.
Internal Innovations driven by India TeamDeloitte started to move services in India in 2000, making it one of the first professional services firms to create an
offshore India center.
The key Deloitte difference:
Not just offshoring of back-office but also client-facing functions, all delivered with high standards of quality that Deloitte is known for.
The lower cost of employing talent in India has a significant impact on ROI; at the same time, the high quality work delivered by the offshore group has a significant impact on Deloitte's growth.
The Innovation HighwaySo where exactly is Deloitte on the Innovation Highway? Deloitte admits that in the past, the innovations at Deloitte were "
Distributed Reactive" a condition it tactfully describes as: Innovation that happened at the edge, was chronically under-invested and usually following another’s lead. Whereas today, Deloitte Innovation is "
Programmed Proactive" - where Deloitte is proactively focused on connecting the edge to the core (e.g. Innovation Quest), by challenging some norms, and realizing that it is not just a means to an end. However, Deloitte wants Creativity and Innovation to be "
Culturally Ingrained" tomorrow - innovation as part of Deloitte's core DNA (processes, people, and technology), innovation as efficient and effective, and as an externally recognized differentiator. A big portion of this is removing obstacles, and finding a way to say “yes", by
failing fast and forward, however learning from the experience.
I asked Rick one key question: "
What innovations drive new business at Deloitte?"
Rick Rayson: "Innovation at Deloitte occurs every day with the hundreds of client service teams and thousands of professionals who create solutions for our clients. The key is to assimilate these innovations occurring at the "edge" to the entire organization to drive new services to our clients on a broad basis."
Strategic Innovations at Deloitte - From the "Edge" to the "Core" back to the "Edge" Fast -
You get the picture!
Download my Creativity and Innovation eBook. 212-page collection of over 55 best practices, case studies, and insights on the current state of Creativity and Innovation in Business at Top Innovators including Apple, Google, Netflix, 3M, Frito Lay, Johnson & Johnson, Proctor & Gamble, Toyota, GE, BMW, Deloitte, Southwest, Nike, IBM, Dell and more. "Your report from the eBook and definitive guide was the primary reference that we used." Used by over 500 leading organizations including HP, Pepsi, EDS, J&J, Nokia...
Learn more Download NowAbout Rick Rayson
Managing Partner Rick Rayson (Deloitte & Touch LLP) is the leader of Orange County Practice, overseeing the Deloitte U.S. Firms' subsidiaries providing audit, tax, consulting, and financial advisory services. Rick has been with Deloitte for more than 27 years. Rick is advisory partner on many of the practice's major clients, and is actively involved in the Orange County business community. He is a member of the University of California, Irvine Chief Executive Roundtable, and is on the Dean's Advisory Board for UCI's Paul Merage School of Business.
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How does Apple, the #1 innovative company in the world, innovate and create game-changing innovations such as the iPod, iTunes, iPhone, iPad and more? What is Apple's secret recipe for innovation success?
How did Apple do it?
Apple has built an Innovation Factory – one that harnesses unbridled creativity from its people, stimulating bold & enterprising new ideas, and launching successful, profitable new innovations... time and again! Apple leverages its diverse ecosystem of employees, customers, suppliers, partners & global networks, proven innovation process, and a winning culture that doesn't accept second place - to seize the new opportunities in the marketplace and grow its business... exponentially…
Sanjay Dalal is an innovator, investor and entrepreneur with over fifteen years of experience in Silicon Valley and High Tech companies. Dalal, author of over 200 articles in the last year and a half on the real-time state of innovation in business at his blog 