I’ve been reading through the PwC report “Breakthrough innovation and growth”, a survey of 1,757 C-suite and executive respondents, on their thoughts on innovation. The top line news is how companies are seeing innovation transforming their businesses and their need to take a more sophisticated approach to innovation, so as to achieve the growth plans they are setting for the next five years.
PwC are suggesting there is an innovation transformation under-way: “Companies are changing the way they innovate“. They further state that “innovation is becoming a competitive necessity, if it’s not, then executives need to be asking themselves what they could do to improve their innovation process.”
All I am providing here are my initial takeaways from a report I would recommend does provide really good value in working through. It seems innovation is becoming far more the central driver of the organization’s agenda than in the past, where geographical expansion along with mergers and acquisitions were more dominating.
It seems the future focus is far more on leveraging organic growth as organizations view the increasing dynamic and volatile business environment will intensify and be even more risky but to achieve their growth objectives they will be needing to look beyond the traditional options they have explored so far to-date, through their innovation activity.
Firstly the transforming taking place around innovation
The five key transforming aspects with leading innovators taking a more advanced approach to innovation:
- Seventy nine per cent of the most innovative companies in their study have well-defined innovation strategies,
- Top innovators treat innovation just like any other business or management process that can be disciplined and successfully scaled.
- The leading companies are targeting a higher proportion of breakthrough and radical innovations, particularly around products, services, technology and business models.
- They are planning a wider range of innovation operating models.
- They collaborate more than their less innovative peers.
The factors setting the innovation leaders apart
Within the report findings, PwC are suggesting what clearly is setting the leaders apart can be summarized as they:
• innovate with purpose,
• have a well-defined innovation strategy,
• take a more formal and structured approach to innovation,
• are concentrating on a greater proportion of breakthrough and radical innovations,
• are planning a broader range of business model innovation,
• are exploring a wider range of innovation operating models,
• are planning to collaborate much more to generate a greater proportion of revenue from new products and services
The close of the report asks seven great key questions in the role executives do need to play in supporting the innovation efforts.
- Are you paying enough attention to innovation? Innovation is quickly moving up the agenda for all businesses, becoming a competitive necessity and the main driver for growth. When was the last time that innovation was discussed at your management board?
- Do you have an innovation strategy? Innovation needs to be thought of as process which can be disciplined. A coherent innovation strategy aligns all elements of an organisation to its corporate goals. How do you plan to harness innovation to accelerate growth?
- Is your innovation portfolio right? Innovation portfolios are evolving, including a greater proportion of breakthrough, radical, and non-product innovation and a much broader range of areas to innovate. How well-balanced is your portfolio and where are you prioritising your innovation resources and investments?
- What is your innovation timespan? Companies too focused on the short-term never challenge existing thinking, while those too focused on the long-term overlook immediate delivery. A balanced perspective is needed. Are you creating the business of tomorrow while running the business of today?
- Is innovation an integral part of the executive and organisational mindset? Are operational efficiency and innovation metrics part of all management meetings?Are the resources, investments,processes, organisation and governance sufficient to provide the space for innovation to thrive?
- Do you know how to explore and find the really great innovations that drive unprecedented levels of growth? Is exploration something that people are incentivised to do?Do the innovation processes use leading practices to ensure high speed prototyping, exploration,and learning?
- Are you an innovation blocker or enabler? Executives too comfortable with the status-quo are one of the greatest barriers to greater innovation. Do you have the mechanisms in place to commercialize and scale your innovations? The last mile of turning innovations into significant revenue growth is often the hardest.
For me, this has been a report well worth working through, so thank you PwC for providing these valuable sets of insights. They offer encouraging news for innovation and its critical role within the current thinking within leading innovating organizations and the changing treatment that innovation is receiving.
This is certainly good news from any innovators perspective and a more than valuable report to put under the noses of the leaders of the organizations that are more within the ‘innovation laggard’ camp.
Those ‘ innovation laggards’ that are failing to appreciate the changes that are taking place within innovation practice and recognizing how they can leverage their future growth in broader and significantly different ways. Exploring different, more radical innovation practices, that have the potential for offering a real impact on their future growth potential, far more than the existing ones they are presently undertaking and supporting.
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