Nine emerging technologies will transform innovation management

30 January 2019

New research has revealed that digital technology could transform the innovation process across all types of organisations in the coming years. However, barriers such as a shortage of digital thinkers and capabilities threaten to hold back the majority of companies.

With the importance of innovation to the future of modern businesses becoming increasingly important, companies across all sectors are coming under pressure to realise the potential of technological changes, as they look to avoid falling prey to digitally disruptive competitors. A key indicator of this sea change in innovation is the booming digital transformation consulting market, which is now worth more than $44 billion, as clients tap firms for support of their overhauls.

However, despite vast commitments of resources towards retooling the digital technologies of top businesses, recent studies have shown that in most cases, digitalisation efforts fall short of achieving top-line growth. This is largely tied to the legacy IT infrastructure of many organisations, which can struggle to get the most from the latest digital advances, hampering transformation efforts.Digital technologies - key enablers for Innovation Management

This disconnect between desire and execution has been exposed in stark detail by a new study, which has revealed that 90% of business leaders believe that digital technology will transform their industry. At the same time, more than six in ten see legacy IT as standing in the way of realising the potential of digital technology, while an even higher portion cited a skills shortage as holding back this progress.

Barriers to reaching potential

According to the report from consulting firm Arthur D. Little, emerging technologies are expected to partly or even completely transform the way innovation gets done, according to 93% of all surveyed companies. However, some 50% of respondents said that they were still looking to understand the full potential of new technology on their businesses, suggesting that while many are aware of the importance of innovation, a large portion of businesses have not adequately examined how it applies to them.

Naturally, adopting all these technologies is not easy either. There are many barriers facing firms, with respondents most often citing a shortage of digital thinkers as the biggest challenge. 47% said that they were likely to be impacted by such talent demands, while a further 45% said that they would struggle thanks to their present capabilities. With legacy IT systems in place often being poorly suited to new digital platforms, this often presents a major hurdle to a transformation project.

Overcoming roadblocks for digital innovation

Once firms have overcome these key obstacles, according to the researchers, there are nine technologies which will bring a distinct type of benefit to innovations at a company. These are big data/advanced analytics; connected things; additive manufacturing; virtual modeling/simulation; cognitive, self-learning systems/bots; augmented reality; collective intelligence/crowd sourcing; virtual workplace/workplace 4.0; and eLearning.

According to the authors, these nine categories can be grouped into three families, depending on what they bring to innovators. First are those which boost intelligence, e.g. about customer needs. In the second group are technologies that bring better and faster foresight, e.g. concerning product performance. Finally, there are digital solutions that improve and accelerate collaboration, communication and learning.

Digital’s benefits to innovation

According to the authors, the transition to digital innovation in these fields will bring many benefits. The share of sales from new offerings relating to digital technology could be in line to benefit to the tune of some 211%, according to Arthur D. Little’s estimates.Benefits from the transition to digital innovation

Innovation success rate is also likely to increase by some 194%, while the speed of such a process might improve by 177%. Leaders will benefit from a 1.7x increase in innovation performance, rising to 2.4x for those that are able to optimize their operations through digital.

Commenting on the findings, Michaël Kolk, Partner and Digital Innovation Lead, Arthur D. Little, explained, “All organisations understand that digital technology will transform innovation and deliver enormous benefits. However, our report shows that these benefits will be unevenly distributed, with many organisations struggling to overcome barriers that are holding them back. Now is the time for this group to begin their digital journey in order to successfully prepare for the future.”

Related: Digital transformation is essential for future of British retailers.

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Two thirds of UK employees not empowered enough to innovate

18 March 2019

A culture of equality can drive innovation at work, but only a third of UK employees feel empowered to innovate at present. This demonstrates a significant disconnect between workers and their bosses in the UK, with 76% of business leaders also claiming they empower employees to be innovative.

Despite innovation increasingly being seen as integral to the survival of businesses, innovation remains relatively difficult to achieve. A lagging disconnect between management and staff remains the driving force behind this. One study by PA Consulting previously confirmed that while 66% of companies believe they will not survive without innovation, only 24% said they had the skills needed for that, and only half thought they had the right leadership in place to change that in time.

In order to find a way around this problem, global consultancy Accenture has completed its own study into innovation, polling around 700 bosses and workers across the UK to do so. The key finding of the research is that companies with a culture of equality can see an individual’s willingness and ability to innovate improved by seven times that of the least equitable workplace cultures. At the same time, an innovation mindset is almost twice as high in the most-equal companies as in typical ones.

91% of employees want to innovate but just 34% in typical United Kingdom companies feel empowered to

What remains clear, however, is that most companies are failing to adequately create an equal culture, where staff of all ranks feel comfortable contributing new ideas. 91% of employees want to innovate but just 34% in typical UK companies feel empowered to. That is higher in the most equal companies, where 75% of staff feel confident making suggestions, compared to just 5% of the least equal, and 34% of typical companies. Since those equal companies are comparatively fewer, when averaged out, only a third of UK staff feel they are empowered to innovate.

That figure stands in stark contrast to the perceptions of UK executives, however.  76% of business leaders in Britain believe that they do indeed regularly empower their employees to innovate. As a result, it seems that leaders mistakenly believe that some circumstances encourage innovation more than they actually do. For instance, they overestimate financial rewards and underestimate purpose.

The opportunity which is presented by addressing this divorce is enormous. Accenture calculates that global gross domestic product would increase by up to £6 trillion over 10 years if the innovation mindset in all countries were raised by 10%.Top 10 workplace culture factors - by strength of impact on innovation mindsetAccording to Accenture, the best way to impact positively on a company’s innovation mindset is through the provision of relevant training – associated with a 10.5% uplift to staff’s confidence innovating. Allowing the freedom for employees to be creative followed, contributing an 8.1% boost, while ensuring that training times are flexible and the firm allows a healthy work-life balance both see a more than 7% improvement. Similarly, remote working being available and being common practice will buoy creativity by 6.9% – further demonstrating the importance of flexible working to improve innovation culture at a firm.

Commenting on the report, Rebecca Tully, executive sponsor for Human Capital and Diversity for Accenture in the UK and Ireland, said, “Our research reveals that a workplace culture of equality is an overlooked driver of innovation within companies. By understanding what motivates their employees and fostering an environment where people feel empowered, business leaders have the opportunity to unleash the innovation required to compete effectively in an era of disruption.”

The research came as part of a global survey by Accenture, which queried more than 18,000 professionals in 27 countries and 150 C-suite executives in eight countries. The overall research determined that an empowering environment is by far the most important of the three culture-of-equality categories in increasing an innovation mindset, which consists of six elements: purpose, autonomy, resources, inspiration, collaboration and experimentation. The more empowering the workplace environment, the higher the innovation mindset score.