Innovation means different things to different people.

For some, it is about researchers devising clever new ways to make computers run faster. For others, it is about changing the way we live and work with new technology.

For a company such as Intel, with one of the largest research and development budgets in the IT industry, it is about both.

Computing talked to Martin Curley, Intel's global director of IT innovation, about the implications for IT directors.

What do technology professionals need to do to prove to the board the link between IT innovation and profit?

In one sense it's very simple, in another it's very complex. One of the key practices is simply business case discipline and return on investment (ROI) analysis. After a project has been completed, focus on measuring the ROI that is being delivered. I did a talk to about 70 chief information officers (CIOs) in London, and I asked how many of them are measuring ROI before an IT project, and 30 per cent of hands went up. Then I asked how many measure ROI after implementation - zero.

At Intel in 2003 we decided to focus on improving business value, and one of the key steps was developing a programme to focus on measuring the return. We were able to deliver $180m of new value to the company without any incremental spending.

There are lots of improvement paths, but the easiest one is to start measuring ROI after implementation. If you start to measure something, it gets better automatically.

How big a problem is this?

We see a structural problem in the IT industry. If you ask any CIO what is the aggregate return on your IT investments, you get two responses: One is a blank stare, the other is a knowing smile and them saying: "I know we should be measuring it, but we aren't."

The IT professional has a problem around quantification and measurement. We did a lot of research with academics and working with lots of CIOs and they all want best practices. We created a framework for business value so an organisation can do an assessment of how mature their practices are, and chart a structured evolution path to improve. I think we can add some good measures from within Intel and other companies that have followed these practices and delivered significant value.

If you think of the impact of IT at a macro level, there are three areas - improving efficiency, improving effectiveness, and transformation. IT innovation is about going for the transformation. There is business process change that has to happen, organisational change and in many cases societal change.

It's about being a catalyst. We think when it comes to IT business value, there is a real gap in the profession and the industry around discipline and techniques for managing business value.

What can be done to change the situation?

We need role models, to show people what is possible. I was in Sacramento, at UC Davis Medical Centre, which has a $1bn capital spend over the next couple of years. I told them about an Israeli hospital we worked with. The Israelis doctors have mobile wireless laptops accessing patient data onscreen, they get lab results direct to the laptop, and can email details to the patient's GP, transforming the process. UC Davis is a tremendously sophisticated environment, but this was a wake-up call for them and they are going to change their strategy as a result.

At a national level, it needs a real visionary that can lay the ground and come hell or high water, no matter how popular or unpopular it is, they need to be an advocate and persist with it. We are evolving into the information society, and the leaders will be the winners.

Should the government be doing more to create the right environment for innovation?

The numbers of students in the West applying for computer science degrees has declined, but the world is becoming more and more competitive. Portugal is a good example where there's some real leadership. There's a guy there running an information society initiative. He says they are trying to transform the Portuguese education system so students graduate as entrepreneurs rather than employees, and there's a very visible commitment to that. They are changing the curriculum. There's a great opportunity for less developed countries to really advance very fast because IT is a cheaper resource, relatively speaking.

Is it a cultural problem about people using technology? After all, we are a nation of people that struggle to programme a video recorder.

Computing capacity is way ahead of the ability of society to absorb it. But there is so much opportunity to transform the digital divide into a digital dividend. Think about education - e-learning was massively over-hyped but we are getting to a point where a lot of things are coming together to allow IT to transform the economics of education, the quality of learning, the productivity of teachers.

In Portugal, we have been working with third-level institutions to make them all wireless, students have mobility from a wireless notebook for their studies. In some areas, society requires some time to catch up, but in others we see tremendous opportunity.

How is the UK doing as a centre for innovation?

It's in the middle of the pack. I don't see advanced leadership coming from the UK, but it's not a laggard. I think the IT programme in the NHS is very ambitious, it's a brave move and the right move, so there is leadership coming from Downing Street in that. There are pockets of excellence.

Italy has a minister for innovation, and I think that is something that the UK could have to drive this area.

What technology areas is Intel focusing on for new innovations?

Many horizontal technologies, such as peer to peer, mobility, virtualisation. Client backup is a big issue - it's very costly to do, server-based solutions are pretty expensive. We've been prototyping peer-to-peer backups so you can backup a laptop to five or six others and secure the storage - that really changes the economics of backups.

One of the big issues is global collaboration. We have design teams in Ireland, Penang and California. How do you get that to work? We are creating some concepts that will herald the next-generation collaboration environment.

And we are looking at virtual reality environments. It's a very expensive technology, and people believe you can't use it commercially. We think there are good opportunities to use Itanium chips to lower the price of this technology, then add some business value such as training and collaboration.

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