At first glance, Brazil seems perfectly positioned to be a leading innovator in an increasingly connected and collaborative world.
Brazilians, for example, set great store by the relationship building that sustains such collaborative enterprises as Apple’s iPhone, most of whose innovative apps are written by external developers. They are also enthusiastic adopters of the disruptive digital technologies that, by enabling “default to open” (the term coined by Google to describe how to leverage the creative potential of the crowd), are driving faster, more cost-effective innovation. And the country’s embrace of connectivity—Brazil has the world’s third-largest number of Facebook users, many of them small businesses and startups—constitutes a critical asset as technology-driven networks reshape the global innovation landscape.
Indeed, these core strengths should be putting Brazilian companies on a par with the world’s leading innovators.
But a nation whose businesses enjoy global prominence in innovation-intensive sectors as diverse as biotechnology, clean energy and aerospace languishes in 61st place on the 143-country Global Innovation Index compiled by Cornell University, the INSEAD business school and the World Intellectual Property Organization. What’s more, Brazil is also remarkably ineffective by global standards in its efforts to turn inputs into innovation outputs, from patent applications to new products, services and business models.
Plainly, Brazilians just aren’t turning their innate innovation advantages into world-class initiatives—and small wonder.
Most Brazilian companies still prefer to go it alone, and close to home. When Accenture recently asked executives from 10 major developed and emerging economies how they would go about expanding their business into a new area, fully 72 percent of Brazilian respondents—the highest proportion by far among the countries surveyed—affirmed that the way they would do so was through in-house ventures (compared with just more than half of US companies, for example, 37 percent of UK companies and 36 percent of Indian companies). Moreover, just 40 percent (versus more than twice the number of Chinese respondents) said they would expand through strategic alliances.