Deloitte & Fast Company Survey: Companies Are Investing More in Innovation Despite Economic Uncertainty
Thursday, February 1st, 2024
Deloitte's collaboration with Fast Company on its "Survey of Innovation Excellence," polling more than 200 named to the media brand's list of the world's most innovative companies, shows that half (54%) will increase their investments in innovation in 2024. As economic shadows lengthen and marketplace landscapes rapidly change, this insight is one of many throughout the survey that reveals an unwavering commitment to advance innovation.
Building agility to power experimentation
In-house R&D (75%)
Expanding AI capabilities (44%)
Conducting hackathons and pitch contests (48%)
Recruiting new talent (57%)
Many companies are also eager for unexpected breakthroughs and revolutionary advancements, with 71% saying they are enthusiastic about or willing to adopt new technologies. However, another one-third are cautious or lack the budget, awareness, or risk aptitude to do so.
Despite the clear advantages of adopting a diverse range of strategies for advancing innovation, the survey also acknowledges the inherent challenges that companies face in implementing these approaches. The survey suggests, among other things, that investing in innovation goes beyond merely increasing financial allocations in order to contribute to sustainable growth and meaningful advancements. Companies should also prioritize recruiting and talent initiatives and develop strategic ecosystem partnerships (42% surveyed seeking to add or expand) — all of which are complex challenges for companies. The survey highlights that while the ambition to innovate is high, the journey remains long, with one such example showcasing that only 25% of companies surveyed have an innovation expert on their leadership team, and nearly half say they lack the talent and resources required for sustained progress.
"In today's rapidly evolving marketplace, innovation transcends ideas or isolated initiatives — it requires a fundamental shift in organizational paradigms. This journey of transformation requires a deep and unwavering commitment. Together with our clients, we are reimagining the boundaries of what's possible. By embedding innovation within organizational culture, we are fostering creativity and empowering teams to experiment with new ideas and approaches," said Jason Girzadas, chief executive officer, Deloitte US.
Diverse perspectives catalyze breakthroughs
Many companies see having a diverse set of perspectives — whether in-house talent or through partnering with outside organizations — as critical to successful innovation. A large majority (83%) are actively recruiting diverse voices, saying it helps attract talent (58%), enables unconventional thinking (56%), and drives greater productivity (32%).
Companies also recognize the value in collaboration, with nearly half expanding their innovation ecosystem, and 34% pursuing partnerships with academia. But protecting IP is a concern — 40% of those surveyed said so — which can make effective collaboration more difficult.
"In this new era of convergence, standing still is a fast way to move backward. By actively nurturing ecosystems fueled by the cross-pollination of different ideas and experiences amongst a vast external network, including a variety of public and private industry relationships, leaders can foster continuous evolution through open innovation that's essential to gaining sustained, competitive advantage," said Deborah Golden, Deloitte US chief innovation officer.
The survey also found that most (60%) measure innovation success by revenue. However, additional "pre-monetary" metrics better enable a long-term, balanced view of innovation. For example, 45% of companies measure innovation through new products and services launched, providing a more comprehensive view. Other non-financial measures like brand value, pipeline depth, and customer engagement indicate future readiness and agility. The survey sheds light on the multi-faceted nature of innovation and the value of companies adopting a variety of metrics relevant to changing business environments.
"In the pursuit of rapid success, it's important to recognize that excessive structure can hinder the very innovation and speed organizations strive to achieve. Allowing for an environment that supports ideation, rapid development and failure, can be just as important as managing innovation spend as a portfolio to allow teams agency to be their best," said Ranjit Bawa, Deloitte US chief strategy & technology officer.
Insights that spur change
The collaboration between Deloitte and Fast Company sets the stage for a unique exploration into the evolving landscape of innovation. Harnessing the power of diverse perspectives in the marketplace, we aim to uncover new insights and forge strategies that anticipate and shape future market trends, empowering organizations to stay ahead in a rapidly evolving business landscape.
"Fast Company is excited to collaborate with Deloitte on the Most Innovative Companies Survey of Innovation Excellence. Deloitte's experience helping clients build resilience and innovation readiness, coupled with analytical acumen, brought depth to our analysis of the results. Deloitte and Fast Company share a passion for forward-thinking approaches to innovation that inspire organizations of all sizes," said Stephanie Mehta, CEO and chief content officer of Mansueto Ventures, Fast Company's publisher.
The survey is important reading for companies looking to maintain an innovative edge in 2024 and beyond. To download the full report, visit http://deloitte.com/us/InnovationSurvey.