July 30, 2020
In the 2018 GE Global Innovation Barometer, nearly three in four global executives believe that a lack of skills is an issue facing their industry. And 64{1fa3f09e2bb6719cc6653a34c4038b8f8c4ebd7a060bb979778d4383cd5dd806} say this hurts their ability to innovate. Sadly, this situation’s only gotten worse.
How to do the most innovative companies get that way, much less sustain their innovation efforts?
That’s what the Boston Consulting Group laid out in its new research, The Serial Innovation Imperative, which lists the most innovative companies in 2020.
The BCG report lays out the three things that serial innovators get right, especially in the midst of COVID-19:
1. Walk the talk
Drive, size and skill are a powerful combination. But drive and size don’t mean a think if you don’t have the skill to do the right things with them. Innovation success starts with commitment. Making innovation a priority and investing decisively means supporting the ambitions of people committed to see the culture and initiative through to success. It also takes the skill of boldness—being willing to pursue opportunities beyond your core. While 60{1fa3f09e2bb6719cc6653a34c4038b8f8c4ebd7a060bb979778d4383cd5dd806} of companies in the report rank innovation as a top 3 priority, not all of them walk the talk. While for 45{1fa3f09e2bb6719cc6653a34c4038b8f8c4ebd7a060bb979778d4383cd5dd806} of respondents say innovation is a top priority, 25{1fa3f09e2bb6719cc6653a34c4038b8f8c4ebd7a060bb979778d4383cd5dd806} are indifferent or inconsistent with their investment. For another 30{1fa3f09e2bb6719cc6653a34c4038b8f8c4ebd7a060bb979778d4383cd5dd806}, innovation clearly isn’t either a strategic or investment priority.
Takeaway lesson: Innovation is a long game. Commit to what you can, but make sure to stick with it. It will grow both purposefully and organically over time.
2. Embrace the benefits of scale
Despite what people say, when you look at big companies pre-COVID-19, they didn’t lumber more with innovation than their smaller competitors. In fact, there are reasons to believe larger companies may now have the upper hand in developing winning products, services and business models. Those surveyed said they had two top issues. First is a lack of discipline in allocating resources (31{1fa3f09e2bb6719cc6653a34c4038b8f8c4ebd7a060bb979778d4383cd5dd806}). The second is uniting the organization behind the innovation strategy (27{1fa3f09e2bb6719cc6653a34c4038b8f8c4ebd7a060bb979778d4383cd5dd806}). But larger companies were able to put more money behind their innovation programs (1.4 times more as a percentage of sales) and reap the rewards—four times as much as a percentage of sales.
Takeaway lesson: Take advantage of all the efficiencies you can. Bigger doesn’t have to mean more bureaucratic if your strategic and intentional about your goals.
3. Calibrate innovation systems for success
You need a well-tuned system to create perpetual success. Makie sure that the “machine that makes the machine” grabs hold of best practices and stays consistent in every corner of the business. The ones on the list that have done it are few – only 20 companies (12{1fa3f09e2bb6719cc6653a34c4038b8f8c4ebd7a060bb979778d4383cd5dd806}) have made the Top 50 list more than 10 times since BCG started their research in 2005.
Takeaway lesson: To avoid the one-hit-wonder trap, make sure that you make decisions that will lay the groundwork for both culture and process for the long-run. Innovation in puffs demoralize people and the best will leave for an environment that nurtures long-term mindsets.
There’s a lot more to the research and you can download the full (form-free) report.
