The digital revolution has exposed abundant value opportunities for companies to raise efficiency and develop new kinds of products, services, and business models. In many industries, upstarts have shown the way—disrupting traditional ways of doing business with innovations such as online retailing or ride-hailing services. Too often, while disruptors rack up rapid growth, steal share, and enjoy fat margins, incumbents are left behind.
This does not have to happen. A small group of outstanding players across industries and economies has shown that large incumbents can innovate, release trapped value, compete with disruptors—and even act as disruptors. These companies are executing what we call a “wise pivot”—a way to reinvent themselves and harness the power of disruption. They are using data, digital tools, and new ways of working to optimize and grow the core business, even as they build a future business.
What prevents most companies from “untrapping” value and accelerating growth is their limited innovation capabilities. Conversely, the small minority of companies that do release trapped value also score highly on the Accenture Innovation Maturity Index. This index takes a new approach to measuring innovation capabilities. In addition to looking at specific innovation processes—whether the innovation function is centralized, for example—the Innovation Maturity Index looks at how companies have adopted seven characteristics, like being “hyper relevant” to customers or being data-driven. The presence of these characteristics reflects a deep organizational change that gives companies the ability to surface new ideas, shepherd them through development, and implement them at scale, enabling them to unlock trapped value.
Only by building strong innovation capabilities, can companies successfully make the wise pivot and manage disruption. The wise pivot allows companies to shift decisively—but safely—to new digital processes and build new tech-enabled products, services, and businesses. The approach involves a series of decisions about where and how to invest so companies can transform and grow the existing business while also scaling the new.