While most organizations understand the importance of innovation for growth and success, majority do not effectively execute on their ideas, said the inaugural edition of an innovation-focused research initiative ‘Become 2020’, released by Mastercard and Harvard Business Review Analytic Services. An associated report titled Innovators Become Leaders, which was also released, explores factors that separate leading innovators from their peers.
“It’s more important than ever for companies of any size to be innovative and creative. It’s our lifeblood,” said Ajay Banga, president and CEO of Mastercard. “This study offers insights and experience from several of the world’s leading thinkers to help others spark the creativity and culture to drive their business.”
The study asked over 1,000 executives over six months how their organizations approach innovation across five key areas – process, human capital, funding, customer experience, and data and technology. Additionally, more than 1,000 global consumers were surveyed to see whether businesses are properly prioritizing what matters most to their customers.
Using the organizations’ self-reported responses to 40 behavioral and attitudinal questions, three groups were identified:
- Leaders – possessing the broadest range of innovation capabilities. This group had a mean innovation score of 88
- Followers – having capabilities in some innovation pillars. They had a mean innovation score of 66 and represented 42 percent of all respondents
- Laggards – lacking a wide range of innovation capabilities. This group had a mean innovation score of 37
The report identified several key ways companies can embrace, launch or reinvent their innovation journeys:
- Speed Wins: Innovators need to think in quarters and weeks, not years. Nearly all (96 percent) of innovation leaders bring new ideas and solutions to market quickly as opposed to 17 percent of laggards
- Data as an Accelerant: Real innovators draw insights from multiple data sources, as business intuition alone does not scale. In fact, 73 percent of leaders draw from both internal and external data sources
- Prioritize Now: Innovation can’t be an afterthought. Nearly 90 percent of innovation leaders prioritize their efforts at the highest levels of the company. This helps ensure the right budget and buy-in to feel more than incremental improvements
- Culture Counts: Organizations need to empower employees to act like entrepreneurs. Not only does this create a culture willing to accept risk, but it leads to a broader pipeline of ideas, as seen by 84 percent of innovation leaders
- Focus, Focus, Focus: Nearly half of consumers say that they expect companies to develop new products, services and features to meet their needs. Organizations need to prioritize breakthrough ideas or risk falling behind customer demands.