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Innovation ambition at healthcare organizations does not match up with execution, and it’s hindering innovation’s impact on creating value.

According to Accenture’s 2016 Healthcare Innovation Research, leaders of healthcare companies are increasingly likely to view innovation as an enabler of long-term success, with 79 percent of providers and payers stating they are extremely or very dependent on innovation to determine organizational strategy.

Companies are thinking big—exploring new and novel approaches, offerings and services. The problem is, their innovation output is low, focused on incremental product and service improvements. Sixty-seven percent of participants report their organizations fail to produce disruptive innovation. Both payers and providers want a big breakthrough, but many are going about it all wrong.

A majority (84 percent) of healthcare organizations are looking for the next “market shifting innovation.” In other words, they are seeking disruptive innovation, yet only 26 percent say that their primary goal for innovation is to disrupt the current market by creating a new process or business model. Organizations are taking innovation baby steps, as opposed to big leaps, because they are not fully committed. Seventy-one percent say they tend to pursue product line extensions rather than new innovation. Half say their organizations struggle to learn from their mistakes, and 68 percent say their organization is risk averse with new ideas.


The fundamental issue is that organizations are looking for innovation, but focusing on renovation..


To increase market share and add value to the organization, innovation leaders must make a shift.

Rather than following one path for all innovations, a two-engine innovation approach can help healthcare organizations achieve their innovation ambitions in the short and long term.

Accenture research has shown that innovation leaders using these approaches follow an accelerated path that is yielding higher rewards: between 3 and 7 percent annualized revenue lift and a corresponding growth in operating model income with their industry peers.1

1Accenture, "Beyond the Product: Rewriting the Innovation Playbook"

All successful innovation requires speed, risk management, measurement, portfolio management and skills, but not all innovations are created equal. Small innovation may be more comfortable, whereas big innovation involves risk, and may push the organization beyond its comfort zone. Thus, approaching each key component differently will allow organizations to achieve greater gains.

Leading companies are achieving success using a two-engine approach. For instance, a large pharmaceutical company established a venture fund to dedicate funding to the pursuit of innovation outside of the business’ core offering, while maintaining focus on incremental innovation among existing product lines.



Click here to download the full article. A Two Engine Approach to Innovation Fuels Success. This opens a new window.


For the two-engine approach to work, healthcare organizations must commit to innovation, creating specific processes and metrics to support and measure innovation efforts separate from established businesses and products. Adequate funding is critical. Innovation funding should span a portfolio of opportunities—big and small—and include funding for incremental innovation to mediate the risk-averse nature of most healthcare organizations. Last, innovation leaders need clear accountability for commercializing these opportunities.

By taking these steps and fueling innovation through both engines, organizations will not just “think” innovation, but also reap its rewards.


Brian Kalis

Brian Kalis

Managing Director
Digital Health

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Benjamin Vick

Benjamin Vick

Management Consulting Manager

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