In today’s highly competitive markets, innovation is critical for competitive advantage.
Ideas are the new currency, but having good ideas is not enough, said Accenture Nigeria as outliners for its 2018 Nigeria Innovation Index were unveiled.
Organisations who will retain and grow market share are those who generate better ideas and implement these ideas at a faster pace, Accenture reiterated.
Against the backdrop of disruption, driven by digital, only organisations that seamlessly integrate innovation into everything they do will achieve sustainable growth and retain competitive advantage.
Banks and Fintechs participated in the maiden Accenture Nigeria Innovation Index, providing insight on how they leverage innovation to stabilize and drive growth for maximum benefit.
“On average, organizations invest 35 percent of annual revenues in innovation and realise a 40.5 percent return.
However, a few outliers invest 22 percent of revenues and achieve returns of 61 percent – 1.5x the market average” said Accenture Nigeria Country Managing Director, Niyi Yusuf.
“We are calling these organizations Innovation Leaders. As we dug deeper to understand what they do differently to achieve such returns on their innovations, a number of key themes stood out as differentiating factors. Strategy, Innovative Culture, Talent, Collaboration, Business Intelligence and Digital; Innovation Leaders scored significantly higher across these areas than other organizations,” he further explained.
Leadership make significant investments in innovation strategy and lay a solid foundation for a high performing innovation culture, ensuring a steady flow of ideas from an engaged workforce.
“Innovation Leaders prioritise projects, foster a strong collaboration culture central to their innovation strategy, use digital as a business enabler and revenue generator, leverage the power of ecosystems to gather intelligence and apply insights that help them differentiate offerings in the market.” said the Managing Director – Financial Services at Accenture Nigeria Toluwaleke Adenmosun.
The Index indicates that Innovation Leaders are cultivating their people to be innovative – encouraging employees to share ideas openly and promoting the use of interactive tools and digital platforms for collaboration.
95 percent of Innovation Leaders are giving more control to their employees to ideate and offer strong incentives as a reward for innovative ideas.
Rewards include: opportunities to collaborate with different business units, professional development, varied work assignments, personal recognition and financial grants.
Only 56 percent of all organisations recruit new people with specific skill sets to support innovation-related activities, versus 100 percent of Innovation Leaders.
Another differentiating theme is collaboration, the ability to break down silos and collaborate within and outside the organization gives Innovation Leaders a distinct edge in ensuring long-term success.
There is a stark contrast in how Innovations Leaders and the rest of organizations generate ideas.
“100 percent of Innovation Leaders make use of dedicated multi-functional innovation teams as well as external platforms and channels to generate new ideas compared to 28 percent of other organizations. Innovation Leaders clearly see opportunities in leveraging the broader ecosystem: 85 percent look to academia, clients, customers and suppliers to crowdsource information to innovate,” said Adenmosun.
Innovation Leaders leverage Business Intelligence and Analytics to drive their innovation agenda.
The explosion of data and, importantly, analytical solutions to help make sense of the data, has significantly improved how organizations make decisions; enabling them to approach opportunities, risks, partnerships, and customers differently – with foresight not previously available. 70 percent of Innovation Leaders (others 14 percent) emphasize Business Intelligence and Analytics.
Complementary use of traditional data-gathering methods and newer digital platforms provided the opportunity to tap into big data and social media channels to stay in touch with market perceptions, see what competitors are doing, generate ideas and react with precision.
Digital technologies are adopted by Innovation Leaders to drive efficiencies and operational excellence.
All Index participants indicate that Innovation investments focus on business improvements, especially process modification and/or automation (100 percent).
Organizations are beginning to weave innovation into the fabric of how they think and serve customers; focusing on improving existing products, adding new products to their portfolio and delivering a positive end-to-end customer experience which translate into significant cost efficiencies.
Digital capabilities are a competitive advantage for optimizing customer value.
By investing in digital, Innovation Leaders improve their cost-to-serve and response times to customers.
These organisations use digital technologies: social media for product and service promotion and technology apps to improve service delivery and, ultimately, customer satisfaction.
“Innovation is a foundation for growth and business sustainability in a digital era, so getting the right people, business, technology and innovation structures in place is vital. Nigerian Banks and Fintechs are on the right path”, said Adenmosun.
The Innovation Index provides some insight into how organizations in the Banking sector are building strong innovation engines by investing in innovative skills, fostering a collaborative culture, leveraging digital technologies and tools, encouraging open idea-sharing and measuring impact.
The journey to turn ideas into solutions with wider economic and social impact is a dynamic one.
Organisations need to mature progressively across the Innovation Value Chain – creatively strategize, openly ideate, deeply absorb, successfully execute and continuously measure success.
“It is my hope that Accenture can partner with Banks and Fintech companies to drive their innovation agenda and engage strongly with their customers – re-imagining the future and bringing it to life” said Adenmosun.