According to the U.S. Labor Department, the productivity of U.S. workers surged in the fourth quarter at a 2.6 percent annual rate, far surpassing projections of a 2 percent rise by a survey of economists conducted by Bloomberg. Meanwhile, labor costs fell for the fifth time in six quarters. In short, when the economy produces more goods and services with effectively the same size workforce, productivity goes up.
Although some economists expect productivity to slow during the year as the economy continues to expand and companies hire more workers to increase output, the short-term prognosis isn't terribly encouraging, at least for some job seekers. In fact, the startling rise in productivity could also backfire for some CIOs and IT staffs, at least in the near-term.
Companies have been getting a lot more serious about investing resources in innovation as CEOs push to generate new revenue streams in a sluggish economy. As they do, a growing number of companies such as Harley-Davidson, Motorola and Xerox have set up cross-functional innovation teams to brainstorm on breakthrough ideas to support different areas within the organization. More on that later.
First, how important is it to have a single senior business executive to spearhead innovation within the organization? To that end, which executive should it be? The CIO? CMO? COO? The answer to this depends on a few factors, including the industry the company is in, the culture of the organization and the person who's best suited for that role.
A report by Gartner and the Financial Executives Research Foundation suggests that the CFO is increasingly becoming the top IT decision-maker in many organizations. The study, which is based on a survey of 482 senior finance executives, also found that more IT organizations report to the CFO than to the CEO or any other executive.