Last year was an exciting one for innovation — but not because of all the futuristic technologies, gadgets and devices that hit the mainstream. In fact, while voice AI, self-driving cars and cryptocurrencies made headlines, something even bigger happened: Companies of all sizes finally began realizing that competing in today’s digital economy requires more than just a blueprint for the next gadget.
Organizations from large enterprises to startups began seeing innovation as a platform for their growth and very survival. They began to view it as a mindset and attitude that must be woven into every aspect of their company culture.
This was music to our ears, because experience shows that innovation is about people with diverse backgrounds, ideas and opinions embracing entrepreneurship and co-innovating to bring new ideas to life.
Although 60 percent of companies surveyed for KPMG and Innovation Leader’s Benchmarking Innovation Impact 2018 said they are still in the early phases of innovation maturity, we expect fresh, dramatic progress. Organizations across industries are slowly but surely figuring out the ingredients of an effective innovation program. They’re learning that they have to secure funding, build dedicated innovation teams and break down cross-functional silos for companywide collaboration.
With this trend in mind, here are our top innovation predictions:
Global conglomerates that don’t prioritize innovation will cease to exist…
Or else they’ll become irrelevant, or at least warrant a significant restructuring in 2019. Look at the prediction of two-thirds of Fortune 500 c-suite executives in a survey: They said they believed that 40 percent of companies like theirs would not even exist in ten years, due to digital disruption.
We believe this demise may come even sooner. In fact, it’s not too farfetched to say that at least 5 percent of Fortune 1000 companies will become irrelevant, due to a failure to innovate in the face of this year’s digital disruption.
Companies will appoint a chief growth (or innovation) officer.
Whether a company’s strategy focuses on growth or survival, its chief growth officer (a.k.a. chief innovation officer) will emerge as the driver of companywide innovation programs. While these roles have traditionally been more common in the science space, we’ll see these executives proliferate across industries potentially constituting, I think, in more than a quarter of the Fortune 500 companies.
Already central to talent development, HR will be a catalyst for inspiring and encouraging all employees to tap into their “inner entrepreneur.” After all, innovation is about talent and culture. In this way, HR will help promote an environment of inclusion and diversity, as the best ideas rarely arise when everyone on the team hails from the same background.
Folks from dedicated innovation teams may sit at the helm of innovation, but middle managers will take the reins, convincing their peers and those under them to embrace innovation, while connecting them with the company’s broader strategy. After all, innovation belongs to the “people,” not just the c-suite or the board, and middle managers are the bridge to making innovation possible.
For true co-innovation to occur, collaborative relationships must be built with those outside an organization, including startups, universities, government agencies, accelerators and the local community itself. In 2019, c-suite and channel managers won’t be the only ones working with external players. Employees of all ranks and roles will be increasingly involved in these partnerships. For example, we’ll see staff at large enterprises working on-site at a local startup on a rotating or regular basis, as they share best practices and ideas to incubate new solutions.
Innovation will redefine the meaning of corporate social responsibility (CSR).
These two elements will become more tightly intertwined. In technology specifically, CSR will move beyond charity work and become a key performance indicator (KPI) — as significant as net revenue growth and relative market share. innovation initiatives will focus on developing solutions to stimulate social good, as partner ecosystems co-create digital solutions that can be scaled to address global issues such as poverty, pollution, hunger and more.
Innovation is not a solo sport. Therefore, we’ll see more companies joining forces to deliver new value to their customers. For some examples, look no further than recent partnerships between Hulu and Spotify and Ticketmaster and Fanatics, as well as Domino’s work with municipalities and public works departments to fix potholes.
It’s likely that more than 100 new innovation hubs will crop up in cities around the world.
In these hubs or centers, local businesses, universities, researchers, governments and more will work together to co-create scalable solutions for global business, social and economic challenges. We’ll also see more cities establishing “smart zones” for piloting smart city technologies that come from these centers. At the same time, each of these initiatives will be spearheaded by a city chief innovation officer. Which cities will be most innovative? I have a hunch that Toronto, Tokyo and Sydney will emerge as innovation frontrunners in 2019.
The lonely innovator is a myth. When it comes to innovation, execution is key and it requires cross-functional support. Teams of employees, co-innovating with partner ecosystems and customers, will be co-creating a game-changing technology, solution or business model that will be transformational for business or society.
Now that innovation is a non-negotiable competitive differentiator, businesses will need to address these threats head-on this year. To overcome them, innovators must instill the notion of co-innovation throughout the entire company — opening innovation programs and initiatives to all employees and staff.
While 2019 looks bright, these predictions will come to fruition only if businesses embrace the concept of co-innovation. Gone are the days of the solo entrepreneur or lonely innovator. True innovation requires collaboration, co-development, co-creation and co-implementation if we want to solve our most pressing business challenges… and even change the world while we’re at it.
Article originally featured by Entrepreneur Middle East – with thanks to Alex Goryachev