The results of our survey of 1,757 executives couldn’t be clearer: innovation today is a key driver of organic growth for all companies—regardless of sector or geography. Meanwhile, innovation leaders are breaking away from their cohorts, expecting a revenue boost of a quarter-trillion US dollars over the next five years alone. We have also analysed the differences in views between Russian senior executives and their colleagues from both developed European countries and developing countries.
Partner, Head of Centre for Technology and Innovation (CTI) PwC
Tel: +7 (495) 287-1137
Director, Head of Practice, Innovation Strategy and Operating Model
Tel: +7 (495) 223-5070
For our survey—the largest and most comprehensive study of its kind exploring innovation from a global, multi-sector perspective—we drew on insights obtained from interviews with board-level executives with responsibility for overseeing innovation from 1,757 companies, across more than 25 countries and 30 sectors.
For the purpose of our analysis, we segmented these companies based on a balanced scorecard calculated from their responses to the following six areas, which are explored in our study:
From this scorecard, we then identified the top 20% innovators (359 companies), and the bottom 20% innovators (395 companies), enabling us to contrast their relative characteristics and experiences—and zero in on the strategies and tactics of the most-innovative group.
Executives are looking for growth: 35.4% on average, over the next five years. Ninety three percent of executives tell us that organic growth through innovation will drive the greater proportion of their revenue growth. Only 2% of companies expect their growth to be mainly inorganic (i.e. M&A-driven). Innovations becomes a more necessary condition of business growth and competitiveness, and leading innovators receive more advantages over their competitors demonstrating faster and more high-quality growth. Over the past 3 years, growth indicators of top innovators in our study exceeded those of less innovative companies by 16%.
The leading innovators in our study forecast that their rate of growth will further increase to almost double the global average, and over three times higher than the least innovative. For the average company, this equates to $0.5bn more revenue than their less innovative peers. Companies who are less innovative need to think about the additional revenue that they are forsaking and the impact this will have on their share price and shareholder returns.
Leading innovators are taking a more sophisticated approach to innovation treating innovation management as one of the key business functions.
Russian companies are seeing more value in innovation as a source of growth and a way of boosting the attractiveness of their business. Moreover, the efforts of the Russian authorities for promoting innovation in the economy are also a way of recognising the important role that innovation should play both in public and private companies. Furthermore, Russian companies have many options for boosting their effectiveness in managing innovation efforts.
Business leaders need to realise that innovation pioneers already exist within their own industry and across all parts of the world and that if they are not among those pioneers, they need to be ready to step up to that competitive challenge, to avoid being marginalised. Innovation is not limited to a small number of industries or countries. There are numerous lessons that can be borrowed, tailored and made to work for any business. Our study is your guide to the world of innovation and new market opportunities.