rewir innovation seminar 20150827

INNOVATE OR FADE

Disruptive innovation Incremental innovation Structural”innovation”

M&A

DEFINE INNOVATION

BACKGROUND AND PURPOSE OF THE STUDY

§  To understand how Swedish companies work with innovation with the purpose to help organizations better understand various aspects of innovation capabilities, strategies and execution.

§  The aim is to highlight the biggest success factors and pitfalls to give organizations hands on tips in how to improve their innovation capabilities.

PURPOSE WITH THE STUDY

ABOUT THE STUDY

0,00%  

10,00%  

20,00%  

30,00%  

40,00%  

50,00%  

0-­‐50   51-­‐500   500+  

How  many  employees  does  your  company  have?  

0,00%  

10,00%  

20,00%  

30,00%  

40,00%  

50,00%  

0-­‐100   101-­‐1000   1000+  

What  is  your  company's  annual  revenue  in  millions  SEK?  

Responses: 101 Swedish companies

TOP LEVEL FINDINGS

INNOVATION IS A BIG DEAL FOR SWEDISH COMPANIES

INNOVATION IS A BIG DEAL FOR SWEDISH COMPANIES

More than 70% of the companies says that innovation will become more important in the upcoming years.

60% state that innovation has been crucial factor in terms of its business success

INCREASING COMPETITION

40% OF THE COMPANIES HAVE AGGRESIVE GROWTH AMBITIONS OVER THE NEXT YEARS

ONE THIRD OF THE COMPANIES ARE STATING THAT 11-20% OF FUTURE REVENUE WILL COME FROM INNOVATIONS.

12% of the companies are expecting that more than 50% of revenue will originate from innovations.

60% HAVE AN HISTORIC INNOVATION SUCCESS RATE THAT IS AS EXPECTED

20% experience success rates higher than expected.

IN 2000 ONLY 15% OF ITS INNOVATION EFFORTS MET PROFIT AND REVENUE TARGETS. TODAY THE FIGURE IS 50%.

70% OF THE PARTICIPANTS VIEW THEMSELVES AS BETTER ON INNOVATION THAN THEIR PEERS.

ONLY ABOUT 10% OF THE COMPANIES USES STRUCTURED PROCESS IN THEIR INNOVATION EFFORTS

AND MOST SEEMS TO BE LOST WHEN IT COMES TO EXECUTION

0  

1  

2  

3  

4  

5  

Systema3c  process  to  

generate  ideas    

Systema3c  process  to  

priori3ze  ideas  

Management  focus  

Knowledge     Organiza3onal  culture  

Financial  funding  

Ability  to  bring  ideas  to  the  market  

Alloca3on  of  responsibili3es  

Ability  to  measure  

Time  

Elements  of  innova<on  execu<on  

HUBRIS?

”ON THE SURFACE, IT'S NOT A BIG PROBLEM THAT WE TEND TO OVERESTIMATE OUR OWN ABILITIES. HOWEVER, WHEN WE'RE BLISSFULLY IGNORANT OF OUR SKILLS, WE CAN'T WORK TOWARD IMPROVING THEM.”

0  

1  

2  

3  

4  

5  

Systema3c  proccess  to  

generate  ideas  

Systema3c  proccess  to  

priori3ze  ideas  

Ability  to  bring  ideas  

Alloca3on  of  responsibili3es  

Culture   Financial  Fund   Ability  to  measure  

Company  Revenues  and  Execu<on  Elements  

< 100 million SEK

> 100 million SEK

DIFFERENCES BETWEEN SMALL AND LARGE ORGANISATIONS

SUMMARY

§  The companies in the study seem to be highly innovative and expecting innovations to be a great part of future revenue.

§  But on the same time they handle innovation as an informal process without any tools, processes and structures in place.

SO WHAT DIFFERENTIATES INNOVATION PIONEERS FROM LAGGARDS?

Informally   Quite  formally   Highly  structured  Innova3on  Pioneers   32%   55%   13%  

Innova3on  Laggards   39%   50%   11%  

0%  

10%  

20%  

30%  

40%  

50%  

60%  

Innova<on  process:  Pioneers  vs.  Laggards  

THOSE WHO REGARD INNOVATION AS IMPORTANT PERFORM BETTER THAN THOSE THAT DON’T.

0  

1  

2  

3  

4  

5  

Innova3on  pioneers   Innova3on  laggards  

How  important  has  innova<on  been  for  the  success  of  your  company  un<l  today?  

- Innovation pioneers

- Innovation laggards

Vänd grafen

0%  

10%  

20%  

30%  

40%  

50%  

60%  

70%  

80%  

Lower  than  expected   As  expected   Higher  than  expected  

Innova<on  pioneers  vs  laggards:  Historic  success  rate  

- Innovation pioneers

- Innovation laggards

0  

1  

2  

3  

4  

5  

Management  focus   Ability  to  measure   Time  

Innova<on  pioneers  vs.  laggards:  Execu<on  elements  

THE BIGGEST DIFFERENCE BETWEEN PIONEERS AND LAGGARDS LIES IN THE BRAND

0  

1  

2  

3  

4  

5  

Innova3on  pioneers   Innova3on  laggards    

Our  company  has  a  brand  strategy  that  is  clearly  defined  in  how  we  create  differen<a<ng  value  for  our  customers.  

SUMMARY – INNOVATION PIONEERS

§  Use their brand to drive innovation. §  Have higher management focus. §  Know how to measure efforts and results. §  Have processes to be more effective with the time they have.

NO MATTER WHAT, INNOVATION WILL BE KEY MOVING FORWARD

WHAT CAUSE ONE IDEA TO TAKE ROOT WHILE ANOTHER IDEA IS ABANDONED? §  Only in storybooks do inventions comes like thunderbolt

§  Innovation = an idea transformed into customer value

§  Research repeatedly shows that coming up with breakthrough ideas is the easy part

§  The hard part is turning ideas into advances that are practical to implement – practical not only technically, but also commercially

§  Research repeatedly shows that what makes the difference between an idea and an innovation, is the ecosystem or the lack of it.

You sit under a tree, an apple falls on your head, et voilà, you discover

gravity.

TIP NUMBER 1 – USE YOUR BRAND!

TIP NUMBER 2 – WIDER PERSPECTIVE ON INNOVATION

TIP 3 – MANAGEMENT FOCUS AND CULTURE

TIP 4 – PLAN LESS, INTERACT MORE

THE MARSHMALLOW CHALLENGE

WHO CONSISTENTLY PERFORMS POORLY?

WHO CONSISTENTLY PERFORMS WELL?

RECENT KINDERGARTEN SCHOOL GRADUATES

RECENT BUSINESS SCHOOL GRADUATES

Business students

0 Orient Plan Build Ta-Da!

18 minutes

Business students

0 Orient Plan Build Ta-Da!

18 minutes

Kindergarten students

SUMMARY

§  Use your brand §  Wider perspective on innovation §  Management focus and culture §  Interact with customers §  Prototype fast

QUESTIONS? PLEASE CONTACT US!

Johannes Bergh, CEO +46 761 82 02 28 Johannes.bergh@rewir.com

Andreas Lindholm, strategist +46 70 648 46 42 Andreas.lindholm@rewir.com