Businesses have had to pivot fast amid the disruption caused by the pandemic. But it is only the latest disruption in a sea of constant change created, among others, by the adoption of advanced digital technologies, emerging social change, and higher consumer expectations. To beat disruption, leading companies are creating a culture of innovation.
The domination of industry giants such as Netflix and Amazon illustrates the point: innovation is the main source of this disruption and, consequently, the antidote to being displaced. Accenture’s research makes a clear case for innovation.
Accenture Research analyzed 1.3 million Glassdoor reviews of 287 North American companies with revenues above $3B using Natural Language Processing (NLP) that classifies free text from the reviews into several innovation culture-related themes such as risk taking, collaboration, agility, etc. that are defined based on Accenture's deep experience in working with innovative companies. The results were used as input into computing an Innovation Culture Score in the form of an index and then mapped their Innovation Culture Scores to the S&P CapitalIQ revenue of the last 5 years.
Our research confirms that industries with strong innovation cultures are able to drive stronger growth, and that companies that foster a strong culture of innovation are rewarded by a higher growth rate and financial performance. However, even as more leaders begin to recognize the power of creating an innovation culture within their organizations, they are struggling with the transformation.
The research confirms that industries with strong innovation cultures are able to drive stronger growth.
Creating a culture of innovation
The top five barriers to innovation indicated by a study done by WhatIf!, an Accenture company, are lack of innovation mindset, lack of innovation vision, poor innovation execution, poor alignment on organizational values, and lack of infrastructure to support innovation.
The biggest barrier, however, is the lack of an innovation mindset. Without a mindset that embraces collaboration and risk taking, many teams continue to operate in silos and are held back by a fear of failure.
Leading companies are launching innovative programs to embed innovation within their businesses.
Pfizer’s ‘Dare to Try’
At Pfizer, under the companywide “Dare to Try” program, thousands of employees were trained on innovation and experimentation. The program was a direct effort championed by top leadership to embrace thoughtful risk-taking. In addition to the training, a network of champions was set up to sustain this innovation culture. The new culture embraced an entrepreneurial spirit and a willingness to take risks, promoted curiosity, and a focus on problem solving. The pressure to innovate is not going to diminish.
Consider that during the peak of the pandemic in 2020 innovation leaders were able to increase their growth gap by 10 percentage points over the rest of the market from 2019. By 2023, this gap is expected to reach over 115 percentage points.
Revenue Growth Gap: Innovation Leaders vs The Rest
Based to 100
Leaders that focus on making innovation part of the culture of the organization and mindset of each employee can unlock the hidden value and get a significant return on their innovation investments. Companies that are able to do so, have the opportunity to create a gap between themselves and the competition.