The third annual GE Global Innovation Barometer released this past week is instructive for what ails leaders in today’s competitive and increasingly global marketplace.
Researchers have coined the term “Innovation Vertigo” to describe the struggles leaders are facing as they seek to embrace the complexity of a changing business environment. While business executives continue to value innovation as a strategic priority, the changing dynamics of today’s business landscape and uncertainty over the best path forward – is challenging leaders to think differently about how they will achieve growth.
Many executives, however, seem to be embracing this complexity by exploring new and sometimes unexpected opportunities to innovate. Their approaches are surprisingly diverse. Commenting on the Innovation Barometer, Beth Comstock, senior vice president and chief marketing officer of GE said, “Change has become constant and we see leaders responding by betting big on more unconventional approaches to innovation to unlock growth.”
In the face of growing complexity and impacts on local economies 71% of executives believe some form of protectionism— promoting domestic innovation over imported innovations— need to be considered. Oddly, an equal number of executives said governments should open markets further and promote imported innovation and investment. The report says there is a 53% overlap between these two opposing views. Confused enough yet? Here’s the chart.
Another strategy gaining real traction is business model innovation as a route to success. According to the survey, innovating a new model may offer a less risky and resource-intense path to better understand and reach customers over traditional methods such as new product development. In a number of markets such as non-profit organizations, start-ups and recent entrepreneurial ventures new business models have tilted the playing field. In an earlier post, Eight Critical Steps to Leading Change, I noted universities and colleges are facing a fundamental shift in their longtime model. They are far from alone. Health care, associations, professional societies, retailers, news outlets, information empires, government and entertainment businesses to name a few are all under pressure from emerging broad access and delivery models.
Fifty-two percent of survey respondents believe that the development of new business models will contribute the most to their company’s performance going forward, representing a six point increase when compared to how it has traditionally contributed to their innovation portfolio.
Three other trends caught my attention for their influence on innovation and business strategy:
Collaboration as a Competitive Advantage – Collaboration between businesses is emerging as a means to surpass competitors and generate revenue, particularly in emerging markets. Despite global acknowledgement of the power of partnerships, lack of effective IP protection, trust and talent poaching pose barriers to action.
Governments as Stewards of Innovation Environment – Global business leaders are concerned by the policy environments affecting innovation, and are calling on policymakers to create more stable, supportive policy frameworks to help enable better innovation in markets and across borders. Executives perceive safeguarding business interests – talent, knowledge, IP – and removing policy barriers – bureaucracy, over-regulation – as key to allowing innovation to flourish. Respondents said the main priorities their governments should focus on to support innovation, education (50 percent), fighting bureaucracy (48 percent) and protecting trade secrets (41 percent) were identified as the most pressing.
The Right Talent, in the Right Places – Talent has been consistently identified as a critical concern for innovation leaders across the globe, as the creativity and technical prowess of the workforce is seen as key to unlocking innovation potential. Concerns around workforce preparedness abound as companies are seeking to match the right job with the right people and line up the right skill sets to meet tomorrow’s economic needs today.
When you look ahead, what are the threats and opportunities you see for your organization? Do any of the trends discussed here have relevance to the future of your enterprise? Which ones? Share your thoughts and comments below.
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