R&D and Innovation is one of the Top 5 investment priorities for global CEOs
In the current financial climate of low growth, there are few options left to generate new revenues and value. A significant source of revenue growth and value creation, and one that’s not been exploited to its full potential is innovation. This fact was endorsed in our recent analysis, innovation being the growth lever with the greatest impact on share price appreciation and revenue growth.
Innovation used to be known as the feel good factor. It was good for morale but had little impact on share price. Now, it's become a mainstream business capability. It's so important to the global economy, that Governments around the world (China, Russia, Turkey and the UK etc.) are providing funding and supporting companies to develop their innovation capability. Companies are responding by setting up dedicated innovation offices, appointing innovation leaders, running innovation campaigns, and all these initiatives are being backed up with metrics and motivators.
There are some clear indicators that will demonstrate how mature your innovation capability is, and some key components that can be measured to help benchmark a business’ maturity. These generally fall within three areas – innovation strategy, idea generation and monetisation. Those businesses who understand all the components and their abilities know where their weaknesses lie and can work on what they need to do better to deliver higher growth.
Now the competitive battle is on. Those companies with a more mature innovation capability are likely to thrive. Those that don’t, or haven’t taken innovation as a capability seriously, are living on borrowed time. They may do well for a while, but disruptive innovations are coming thicker and faster. Whilst the innovation challenge may be complex, if you’re going to compete in today’s tough markets, it’s an essential component to delivering profitable growth.