The Role of Innovation

Why does everyone say that innovation is important?

Several recently published surveys have confirmed the importance of innovation.

For example, the 1.600 executives respondents to a Boston Consulting Group survey ranked innovation as a strategic priority with 72% ranking it as a top---three priority.

Also, research recently undertaken by McKinsey supports this finding with their survey reporting that "84 percent of executives say innovation is extremely or very important to their companies growth strategy".

You can find the full BCG survey report in PDF here.

You can find the full McKinsey survey report in PDF here.

For organizations, there are a number of reasons which make innovation so important:

Market level

  • To survive adverse changes in operating circumstances
  • To build brand equity
  • To make life easier for their customers
  • To gain competitive advantage
  • To protect market share
  • To reposition organization and raise its market profile
  • To lead the market and reinforce a reputation as market leader
  • To open new horizons so as to get out of a rut or avenues with limited potential

Staff and Organization

  • To stimulate employees with interesting and challenging work
  • To attract and retain talented staff
  • To provide stability for the workforce
  • To encourage employees with good ideas to approach the company
  • To attract alliance partners

External & Financial level

  • To comply with actual or future legislation
  • To reduce competition and / or the influence of competitors
  • To raise margins and profitability
  • To drive total shareholder returns