* Just 12% of companies govern innovation extensively today; the rest govern it more haphazardly
The report, titled Governing Innovation: The Recipe for Portfolio Growth, is based on a global survey of executives at nearly 1,100 companies, a financial analysis of those companies, and in-depth interviews with innovation experts in business and academia. The goal of the research was to determine how organizations apply different types of innovation across their business portfolios, identify how they allocate innovation investments, and help executives understand how to govern more strategically across their business portfolios to get greater value from their innovation investments.
A key finding: Only 12% of companies govern innovation extensively, and those companies achieved a compound annual growth rate (CAGR) of 5.9%, on average, from 2013-2018, compared with a CAGR of 2.9%, on average, for the 88% of companies that govern innovation more haphazardly.
Accenture defines extensive innovation governance as adoption of at least six of 12 governance practices, or "rituals." (see Figure 1).
Figure 1
While the vast majority (84%) of executives surveyed said they direct innovation centrally - e.g., through a chief innovation officer or an innovation committee - the report notes that centralized direction and management might not be enough.
"The growing hunger for innovation is putting it at the core of every new business decision, but many companies lack the discipline needed to turn their innovation investments into growth," said
The report leverages Accenture's Portfolio Innovation model, which looks at the application of three types of innovation (incremental, breakthrough and disruptive) across businesses of all maturity levels (legacy, growth and emerging; see Figure 2).
Figure 2
Once it's clear which type of innovation is needed - and in which businesses - organizations need to identify the right governance rituals to ensure that their innovation investments are geared toward achieving the desired growth.
One example illustrated in the report is
Accenture discovered that organizations are better able to exert control over their innovation investments when they follow at least some of the 12 rituals - and that the more rituals they follow, the greater their revenue growth. In fact, organizations that approach innovation haphazardly today, but plan to switch to governing innovation investments extensively, expect to more than double their compound annual revenue growth at the portfolio level - from 2.9% today to 6.5% in the future, on average.
"Innovation governance rituals are the bread and butter for insatiable portfolio growth," said Dr.
For more information on Governing Innovation: The Recipe for Portfolio Growth, please visit: http://www.accenture.com/portfolioinnovation.
About the research
Governing Innovation: The Recipe for Portfolio Growth examines how innovation is and will likely be governed in the future. The research comprised three components: (1) a telephone survey of 1,090 executives at 1,090 companies above
About Accenture
Accenture is a leading global professional services company, providing a broad range of services and solutions in strategy, consulting, digital, technology and operations. Combining unmatched experience and specialized skills across more than 40 industries and all business functions - underpinned by the world's largest delivery network - Accenture works at the intersection of business and technology to help clients improve their performance and create sustainable value for their stakeholders. With 505,000 people serving clients in more than 120 countries, Accenture drives innovation to improve the way the world works and lives. Visit us at www.accenture.com.
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