Companies and nations rely on innovation to improve productivity and fuel economic growth, but they don’t necessarily have to excel at originating innovation to be competitive – they have to be able to apply innovation successfully, according to Gartner, Inc. Gartner examines the importance of adopting the right technology at the right time in the newly released book “Mastering the Hype Cycle: How to Choose the Right Innovation at the Right Time”.

Jackie Fenn, vice president and Gartner Fellow, is co-author of the book, and she is discussing the latest findings from the book during Gartner Symposium/ITxpo, being held here through today. Ms. Fenn and Mark Raskino, vice president and Gartner Fellow, and co-author of the book, call the repeated pattern of over inflated expectations, subsequent disillusionment, and eventual assimilation the “hype cycle” (examples of the hype cycle graphic are included here).

“To make a good decision about when to adopt an innovation, you need to balance three variables: how potentially valuable the innovation is to you, how mature the innovation currently is, and how good your organizations is at tolerating and managing risk,” Ms. Fenn said.

“The goal of being selectively aggressive in adopting innovations is a simple one, but one deceptively difficult to achieve in practice,” Ms. Fenn said. “The constant barrage of positive and negative hype, the peaks and troughs of hype cycles for every innovation pressure organizations to respond unwisely by adopting too early, giving up too soon, adopting too late, or hanging on too long. These are the four traps of the hype cycle.”

While it’s important to understand the traps that can snare unwary adopters, it’s equally important to examine the opportunities that arise from the inevitability of the hype cycle. Any time an IT leader can predict major shifts in behavior, such as the major turning points on the hype cycle, they can take advantage by being ahead of the crowd.

“We see two types of opportunities arising from the hype cycle. The first set of opportunities comes from timing your adoption of each innovation with precision to optimize the amount of value you can derive. If you’re going to invest your organization’s time and money in an innovation, you want to make sure not only that it’s the right one but that you jump in at the time that gives you the longest lifetime value at an acceptable level of risk,” Ms. Fenn said.

“The second type of opportunity lies in harnessing the energy of the hype cycle in the broader marketplace by taking advantage of the needs and actions of other players,” Ms. Fenn said. ”If you can be smarter than the crowd even some of the time in avoiding the money pits of adopting too early or giving up too soon, and the lost opportunity costs of adopting too late or hanging on too long, you’ll come out ahead.”

IT organizations should establish a proactive process to formally monitor, evaluate, and select emerging technologies to bring into the organization for the right purpose at the right time.

Gartner’s STREET (scope, track, rank, evaluate, evangelize, and transfer) framework provides a structured approach and best practices at each stage of the emerging technology planning process. STREET follows a traditional process of focusing on innovation on the organization’s business objectives, generating ideas and selecting the best ideas for implementation. This includes:

• Scope: decide what your company values and determine your company’s ability and desire to manage risk
• Track: seek out relevant innovations from a broad range of sources and track their progress along the hype cycle to notice relevant advances in their maturity
• Rank: identify innovations that look most likely to bring significant benefits to your organization within a timeframe that fits your risk profile
• Evaluate: use research, prototypes, and pilots to better understand the benefits, costs, and risks associated with adopting each innovation; make strategic decisions about which innovations to adopt, which to shelve and revisit, and which innovations not to adopt.
• Evangelize: rally support for the chosen innovation with key players who can help champion the innovation and ensure its operational success
• Transfer: spark the enthusiasm and sense of ownership required for the innovation to take hold