By Larry Lange

If I have seen further it is by standing on the shoulders of Giants," Isaac Newton wrote in 1676.

Today, nearly 335 years later, that's still a good definition of practical innovation: Reconfiguring the groundbreaking innovations of the past — "standing on the shoulders of Giants" — to meet the most important challenges of today.

Practical innovation occurs when the best minds converge to harness both existing and emerging technologies, along with accelerated service delivery models, to optimize business processes and deliver real value quickly. "Now is the time for more innovation, not less," says Paolo Campobasso, Senior VP and CSO at UniCredit Group, a Milan-based financial institution.

To make practical innovation happen, CIOs need to be strong leaders and powerful communicators, and leverage the right technologies. "Today, 'CIO' increasingly means chief innovation officer," says Paul Horowitz, a Principal at PricewaterhouseCoopers (PwC). "IT is both the guiding star and the engine that moves the organization forward."

CIOs are undertaking practical innovation in two main ways. First, by devising new uses for current IT systems. Second, by deploying advanced technologies — including virtualization, cloud computing and social networking — to reduce costs, improve productivity, and help the business become more agile.

Given today's economy, these challenges are more pressing than ever before — as is pressure on CIOs to do more with less. "Practical innovation means innovation applied to a practical situation, understanding and responding to the reality of your business environment," says Victor Rotaru, Head of IT Information Security Governance at UniCredit Group. "In this context, practical innovation can bring value to the organization."

"Merely aligning IT with the business is dead," adds Ajei Gopal, Executive VP of Products and Technology Group at CA. "Because now, IT is the business. If you can marry a business problem to a breakthrough technology, then you've got a compelling value proposition."