Computerworld - December 5, 2011

basis. Others are more clandestine. Funded with small amounts of money from other parts of the IT budget, these skunk works operate under the corporate radar and are used, among other purposes, to attract and engage bright and eager young professionals who have little patience with big honking enterprise systems.

“I tend to use the skunk works for things that are way out
there,” says the CIO of a global consumer products company. “It
keeps my technology team engaged.”
This CIO, who’s the type who likes to keep things under the
radar, also notes that a skunk works is an ideal setting to hone IT
staffers’ understanding of risk. “One of the biggest concepts with risk
is the difference between ‘I know’ and ‘I think.’ Once you’ve had the
opportunity to play with something, you know about it,” he says. The
proof is in the projects. “We’ve increased our project output by 300%
because my team now knows how to take risks,” he says.

One of his skunk works’ biggest successes has been its work with cloud computing. “We’re operating an internal cloud and now extending it out to deliver applications to our vendors and trading partners,” the CIO says. The ultimate goal is to have all enterprise data reside in the cloud. The IT group will securely deliver applications to any device, but all data will remain in the cloud. Thanks to work done and risks taken in the skunk works, the company is well on its way to achieving this goal, the CIO says.

At Flextronics International, a global
contract electronics manufacturer, CIO
David Smoley avoided creating a dedicat-
ed skunk works in the traditional sense.

“A skunk works is a tool that can help
innovation, but they’re needed most in an
environment that kind of stifles innova-
tion,” he says. Smoley recalls his work at
previous employers, mainly “large compa-
nies where there was a heavy bureaucracy
and rigid processes. The way you got
around that was to spin off some folks
and set them up off-site somewhere.”
At Flextronics, he says, “we created a
kind of massive skunk works by creating a
place where it’s safe to take some risks. In
fact, we encourage that,” he says.

“We highlight failing fast, experimenting, trying things but trying them small. If they work, add a little more. If not, throw them out, move on and don’t kill the guy who tried it,” Smoley says.

This is precisely how the company’s internal social network known as Whisper came about. “We have a software group in the Ukraine that developed the tool for their own use. They brought it forward a year ago,” Smoley recalls. “There are many companies where I’ve worked that would immediately have killed the guys because that was not what we were paying them to do. But we embraced it,” he says.

about the need for Whisper when tools like Facebook and Google were already available, so he organized a bakeoff.

“We put together some business and IT folks and ran a pilot
and ultimately went with Whisper enterprisewide,” he says. “But
that never would have happened if the guys in the Ukraine didn’t
feel safe and comfortable [about experimenting]. If they felt they
were going to get fired, they wouldn’t have thought at all about it,
and if they did, they would have hidden it.”
Yet Smoley is quick to point out that a skunk works or a culture
of innovation does not imply or encourage random experimenta-
tion, especially during tight economic times.

“We’re not just in the business of coming up with cool stuff,
but [rather] coming up with cool stuff to improve security, better
customer service and solve other problems,” he says. “Innovat-
ing with random technologies in an IT department might yield
something [of business value], but chances are it won’t. There’s a
method to the madness. What I want to do is encourage my guys
to innovate around those areas they’re responsible for.”
Smoley is also a firm believer that proximity to a problem
plus a tight economy and constrained resources work to create a
climate of increased innovation.
“Some of the most innovative solu-
tions come from [IT personnel] in the
field or factories where they have the
dual benefit of being severely con-
strained and toe-to-toe and eye-to-eye
with our end customers,” Smoley says.
“Those are the guys who have customer
service, sales and quality folks in their
factories telling them their require-
ments. As they solve their problems, we
troll their websites and look for unique
opportunities to spread best practices.
“We also try to take advantage of our
lack of resources by encouraging everyone
to be innovative,” he says. For example, a
team in IT built an open-source network
monitoring tool that Flextronics now uses
globally. That tool was developed after of-
ficials rejected IT’s recommendation that
the company buy a multimillion-dollar,
commercial network monitoring system.
“The response was, ‘We just don’t have
the money,’ ” Smoley recalls. “But now,
we have this [open-source] tool that has
literally saved us $10 million.”
At JetBlue Airways, CTO Terry Dinter-
man says skunk works are typically set
up to tackle very specific business issues.
For example, the airline set up a skunk
works of sorts in direct response to a
competitive business need for onboard
Internet connectivity for passengers.

“Connectivity into the aircraft is a key business driver, and there was a need to get ahead of the industry,” Dinterman explains. “So we had a dedicated team from business and technology who were set aside to do some investigation.”