What Really Fosters Innovation

WHAT REALLY FOSTERS INNOVATION ARE YOU MISSING THE MARK? Innovation is increasingly viewed as critical to sustaining a competitive advantage in the changing global marketplace. Yet many people also indicate that their innovation efforts are lacking. What gives? We explore the business results behind innovation, the top challenges and ingredients for innovation, and why strategy is key. INNOVATION IS A BUSINESS PRIORITY Business leaders agree. CEOS surveyed by PricewaterhouseCoopers say there's a high premium placed on the ability to regularly pioneer new ideas and approaches. 61% OF CEOS WORLDWIDE SAY THAT INNOVATION IS A PRIORITY OR A PRIMARY FOCUS 61% WITHIN THEIR BUSINESSES. INNOVATION EFFORTS ARE SLUGGISH AND INEFFECTIVE Despite the high premium placed on innovation, more than half of business leaders surveyed by Accenture don't have innovation strategies, and those that do aren't executing on them. 55% DON'T EFFECTIVELY SEEK INNOVATION OPPORTUNITIES. PLAN 55% 66% 66% DON'T HAVE WELL- DEFINED INNOVATION STRATEGIES. WHAT'S STOPPING THEM | Top 3 Challenges to Business Innovation: According to Forrester ----- RESOURCE CONSTRAINTS BUDGET LACK OF STRUCTURED (TIME AND PEOPLE) CONSTRAINTS INNOVATION PROCESSES OR PROCEDURES THE RIGHT INGREDIENTS FOR INNOVATION Much of what fosters innovation involves processes and organization-wide support. A survey by PricewaterhouseCoopers asked CEOS which elements are some of the "most important ingredients to successful innovation." 31% CAPACITY AND CAPABILITY FOR CREATIVITY 5 MOST IMPORTANT INGREDIENTS FOR SUCCESSFUL INNOVATION: 44% STRONG VISIONARY BUSINESS LEADERSHIP 57% 31% ABILITY TO CAPTURE THE RIGHT CULTURE TO FOSTER AND SUPPORT IDEAS THROUGHOUT THE ORGANIZATION INNOVATION 37% 4 WILLINGNESS TO CHALLENGE NORMS AND TAKE RISKS A HOLISTIC APPROACH IS INNOVATION DONE RIGHT Innovation must be part of a holistic and formal system to net positive returns over time. According to an Accenture study. companies with such a system in place see significant yields. 21% SAY INNOVATION 51% ARE FIRST TO MARKET WITH MOST 1 INNOVATIONS, 21% AND 51% GIVES THEM A COMPETITIVE ADVANTAGE. PRODUCTS, AND SERVICES. INNOVATION DONE RIGHT MEANS REVENUE GAINS Successful innovation delivers real business results. According to Bain, companies that perform well in innovation initiatives grow significantly faster than lesser-performing companies-growing to a 3-fold difference in 5 years. TOP INNOVATING 84% COMPANIES* OTHER COMPANIES 5-YEAR COMPOUNDED GROWTH RATE AVERAGE ANNUAL GROWTH RATE 28% 13%. 5% *"Top innovating companies" refers to companies with top quartile scores in the Bain Innovation Assessment Survey of executives at enterprises around the world. WISHING FOR INNOVATION ISN'T ENOUGH. DATA SHOWS IT'S THE PRODUCT OF STRATEGY AND STRUCTURE, WITH COMPANY PROCESSES AND CULTURE TO SUPPORT IT. spigit SOURCES: ACCENTURE, BAIN, DELOITTE, FORRESTER, PRICEWATERHOUSECOOPERS mindjet. .------