Here’s how companies are accelerating innovation

Written by the Amazon Web Services (AWS) Team

Innovation centers on uncovering new opportunities in all areas of the business, whether that’s developing new products and services that drive growth or finding new opportunities to improve process and workflow efficiency through cost optimization or automation.

In today’s economy and digital era, businesses need to drive business value and sustain innovation over the long term. In Deloitte’s Global Survey, Chief Information Officers (CIOs) rank innovation among their organization’s top five business priorities, on par with performance, cost, and growth initiatives. CIOs are increasingly expected to deliver not only ongoing operational efficiencies but also new approaches to customer engagement, products and services, and even business models.

So, what are the common traits of innovators?

“Innovation is about creating something lasting and durable that solves a pain point in customers’ lives both now and into the future,” says Daniel Slater, culture of innovation lead at Amazon Web Services (AWS). “Amazon’s approach to innovation starts with the customer and works backwards from their needs. I think that sentence alone summarizes what we do.”

A customer-centric culture helps AWS and its customers find solutions that empower businesses of all sizes to innovate. “Change is a constant, which means we need to constantly innovate to create better experiences for our customer,” says Slater. “That builds trust with customers that outlasts any disruption. And that’s truly one of the best differentiation and competitive advantages that you can have in a world where products and services quickly can become commoditized and undifferentiated.”

That focus on customers is shared by Syte, a Visual AI Platform for retail that uses machine learning to help brands make products visually discoverable so shoppers can find what they’re looking for. “Syte’s cultural DNA is all about innovation,” says Yair Green, Syte’s chief technology officer. “Our Syte Labs initiative is an example of that – dedicated research teams exploring new ways that AI can benefit our customers, partners, and the broader retail industry.” With the help of cloud infrastructure and machine learning services from AWS, Syte improved customer experience and boosted sales for their retailers. Retailers saw higher order values, higher conversion rates, and average revenue per user increased by 300 percent.

At Siemens Digital Industries Software, customer-centricity is about helping customers understand the art of the possible and providing them with cutting-edge technology to help them achieve it. Its Siemens Xcelerator as a Service portfolio of industry software, powered by AWS, helps simplify industrial digital transformation.

Siemens’ software helps companies optimize their design, engineering and manufacturing processes using “digital twins.” Digital twins are virtual replicas of physical objects such as products or buildings that can be used to simulate, predict, and optimize how the object will perform — before investing in physical prototypes and assets. Evolving the Siemens Xcelerator portfolio to a SaaS model has helped Siemens grow 25% in two years. Siemens’ Digital Twin technology empowers its customers to simulate their product or process digitally (whether that’s a new electric vehicle, a smartphone, or an airplane) so they can understand many various parameters and optimize a product or solution before making any physical investments.

“Right now, all of our customers, in every industry, are facing massive challenges with their overall innovation process,” says Bob Jones, executive vice president, global sales and customer success at Siemens. “We help them understand what is really possible, leveraging the technology that’s available to them today, to improve their overall innovation strategy, whether it be the design of a product, the design of a process, or using the performance of an existing product in service and building a feedback loop back that helps refine the next generation design.”

“If we just apply technology to a customer’s existing process, that’s really not transformational. It’s really critical that we help customers understand what is possible, and then work with them to define what are the steps required for them to drive that transformation,” says Jones.

Innovation happens when people have the freedom to innovate. Top innovators know that good ideas can come from anywhere and encourage diverse voices to challenge assumptions and bring their own experience forward.

At AWS, the culture of innovation includes being customer-obsessed, hiring builders, empowering them to build fast, and treating every day like “Day 1”. But culture has to go beyond words and into action. At AWS, there are processes and mental models that help turn good intentions into action and facilitate high-velocity decision making and execution.

“By focusing on constant experimentation and iteration, you can drive ongoing efficiencies and scale your business,” says Slater. According to Slater, this starts with hiring builders — people who wake up every day eager and excited to find and solve the customer’s most difficult problems — and providing mechanisms to help them make high-velocity and high-quality decisions.

“It’s having that end-to-end ownership, fostering the freedom to get as close to customers as possible, and giving them the autonomy and accountability to constantly invent on their customers’ behalf,” Slater says. “A big part of that is democratizing the ability to bring new ideas to the table. We want everyone to be inspired and bring bold visions from wherever they are in the organization.”

To achieve that, Amazon is intentionally organized with innovation in mind. Teams are kept small — its people are armed with the right resources to support rapid innovation, nimble experimentation, and a single-threaded focus on their customers. The idea is to think big and act quickly using well-designed, low-risk experiments to achieve rapid prototyping and iteration.

“The key is constant and ceaseless experimentation, placing frequent and constant small bets that are focused solely on solving a customer problem and making their lives easier,” says Slater. “And just as important as that initial innovation is the rigor of constantly iterating and improving it from there.”

Iteration is a vital part of how Siemens helps their customers innovate faster. Digital twins enable its customers to create closed-loop connections between the virtual and physical worlds across the entire value chain, thereby developing actionable insights and informed decisions. The digital twin evolves and changes over time along with the product it represents.

“We’ve democratized all the information around a product and created the ability to share that with all the professionals that are part of the innovation process, in the context that they need to do their job,” says Jones. “Data about a product is not just for the fluid dynamics specialist. It’s for everybody that’s involved, whether it’s the marketing team, the finance team, the engineering folks — all those folks together have the experience in the context they need to make decisions.”

“You need to quickly prove the viability of your new ideas because failing fast is cheaper,” says Slater. “You want to abandon ideas that aren’t working very quickly and double down on good ones that much faster. Customer feedback will always keep you on the right track.”

The right technology foundation is critical for enabling the iterative experimentation Slater describes. The key is to make powerful, emerging technologies available to everyone and anyone in the organization, and to reduce the cost of experiments as much as possible.

Cloud services give access to higher-level services that make exciting technologies accessible to more builders. “AWS infrastructure provides a broad set of solutions and fully-formed features that help eliminate undifferentiated heavy lifting for builders,” says Slater. “That helps reduce the risk and cost of experimentation, and allows an organization to focus on the things that matter the most for customers.”

Syte, for example, relies on tools including Amazon OpenSearch, Amazon SageMaker, Amazon EC2, and many more to manage databases, build machine learning technology, monitor activity, and protect their infrastructure. “At Syte, our innovation is in data science,” says Green. Fully managed services like SageMaker mean Syte can quickly and easily build, train, and deploy more and more algorithms that they can use for different products.

Cloud services also lighten the load by optimizing costs and reducing undifferentiated heavy lifting for IT such as managing infrastructure and servers. This allows teams to focus on innovation. “Using AWS managed services, we can maintain our infrastructure without needing to increase headcount,” says Green.

These benefits can then be passed on to an organization’s end customers. “With AWS and [Siemens] technology together, we can ramp compute requirements up and down, essentially on the fly,” says Jones. “This gives our customers much more flexibility to do design and innovation without being overly burdened with IT logistics, whether it’s the technical aspects of infrastructure, or even the commercial challenges of the infrastructure.”

AWS provides on-demand access to computing services to millions of customers globally, giving organizations the ability to migrate, build, and run their applications on a trusted and reliable infrastructure. Companies that use an experienced cloud provider benefit from years of learning and expertise that’s built into the infrastructure and services. Organizations can innovate for the unique needs of their applications with the latest technologies at scale, and tap into an extensive, reliable, and secure infrastructure with a global footprint.

“Moving from desktop applications to cloud applications, we scale to the next level on a global basis that we haven’t seen before in the industry,” says Stuart McCutcheon, global vice president, global sales and customer success at Siemens. “Delivering our solutions through AWS enables a larger amount of people to access this technology in a simpler way. Partnering with AWS enables us to really transform how we interact and sell and enable our customers to access the capabilities of the Siemens Xcelerator portfolio, but delivered as a service.”

Through that partnership with AWS, Siemens was able to empower its customers to not only more quickly build digital twins using its technology, but to rapidly deploy and scale that technology within their organization and with their partners. “AWS created this ability for us to build our technology, not on AWS, but with AWS, that our customers can deploy anywhere in the world,” says Jones. “That takes the infrastructure burden off the table for manufacturers and designers across the world, so now they can experience the digital twin at scale everywhere in the world and, ultimately, accelerate their overall innovation.”

Innovation isn’t just about creating something new. It can also mean adopting a new mindset: Not only what you do, but how you do it.

AWS and its customers exemplify innovation — and while each are taking distinct approaches with unique markets, all are accelerating innovation by focusing on customers, empowering people to experiment and collaborate, and making high-velocity decisions that allow them to fail or scale as quickly as possible.

This model of combining technology and culture enables organizations to solve their customers’ biggest challenges in differentiated ways, reinvesting savings back into new forms of innovation.

Learn how you can accelerate and scale innovation with AWS cloud infrastructure and services.