Innovation is your next big growth opportunity – but it’s not just about new products
The world’s most innovative companies expected to grow by more than 60% over the next five years and significantly faster than companies who don’t put the same emphasis on innovation, a new study has found.
The study, conducted by PwC, also highlighted innovation is not restricted to products and services but also encompasses areas such as customer experience.
PwC surveyed 1757 C-suite and executive-level respondents responsible for overseeing innovation within their company across more than 25 countries and 30 sectors and published its findings in a report titled ‘Breakthrough Innovation and Growth – your $500 million opportunity’.
The top tier of innovators identified came from all kinds of industries and geographical locations, from healthcare to automotive to financial services and from countries like India, the Netherlands and Brazil.
In total, the world’s most innovative companies expected to grow by more than 60% over the next five years, adding a total of more than $250 billion in new revenues, thanks to innovations in all areas of their operations. Comparable figures for the least innovative were 21% growth and $93 billion revenues.
The top 20% of innovators worldwide predicted their growth rate would be double that of the global average over the next five years and three times higher than that of the least innovative companies.
David Percival, PwC’s global client innovation Leader says, “Innovation has gone mainstream. Five years ago, expansion into China was seen as the most powerful source of growth for just about every business. Now, companies see that innovation presents them with greatest potential for growth.”
The study found major differences between the most and least innovative companies. Among them:
- The most innovative companies anticipate 62.2% revenue growth over the next five years compared with 20.7% for the least innovative,
- The combined revenue growth of the most innovative companies is forecast to be US$252 billion over next five years compared with US$93 billion among the least innovative,
- Two-thirds of the most innovative companies say innovation is a competitive necessity compared with 19% among the least innovative,
- Nearly 80% of the most innovative say they have a well-defined innovation strategy compared with 47% of the least innovative,
- The most innovative companies are almost twice as likely to be targeting breakthrough and radical innovations,
- The most innovative companies are more likely to use corporate venturing to drive growth: 13% versus 7%, and
- The most innovative companies use social media more often to collaborate externally: 67% versus 39%.