Connecting Innovation with Digital Maturity
The companies that were surveyed this year are classified into one of three digital maturity categories:
Early (24%), developing (44%), and maturing (32%). Eighty-seven percent of digitally maturing organisations say they have moved closer to their ideal digital state over the past three years versus 60% of developing companies and 22% of early-stage ones. Our research reveals increasing signs of separation between the more mature and the less mature enterprises, and much of this separation surrounds innovation. Digitally maturing companies innovate at far higher rates than less mature businesses, in large part by cultivating a culture of innovation and providing the resources to support it.
Digitally maturing companies are more successful at driving innovation than their less mature counterparts. (See Figure 2.) Eighty-one percent of respondents from maturing companies cite innovation as a strength of the organization, compared with 36% from developing outfits and only 10% from early-stage companies. They invest more in innovation, too, with executives and managers from 74% of maturing companies saying their organisations provide sufficient resources for innovation versus 39% of developing companies and 15% of early stagers.
Innovating Toward Maturity
Digitally maturing companies are more successful at driving innovation than their less mature counterparts.
(Percentage of respondents who agree or strongly agree)
Maturing companies also allocate time to enable their employees to innovate. Eighty-six percent of respondents from digitally maturing companies say that 10% or more of their time at work involves the opportunity to experiment or innovate. At these companies, continual improvement is the new normal, and staying at the forefront of digital innovation demands repeated self-reinvention. By contrast, more than 40% of early-stage respondents report that less than 10% of their time, or no time at all, involves experimenting or innovating.
Making Space for Innovation and Experimentation
A little goes a long way. As companies mature, they allocate time for their employees to innovate.
In addition, digitally maturing enterprises are far more likely than their less mature counterparts to encourage innovation by forming vital digital partnerships with external partners and supporting the internal development of cross-functional teams.
Ecosystems: A Fertile Source of Innovation
Partnerships with external organisations are a key source of digital innovation, especially for digitally maturing companies. At digitally maturing companies, 80% of respondents say their organization is cultivating innovation via partnerships. At developing organisations, that number drops to 59%, and at early-stage organisations, it falls further still to 33%. Digitally maturing companies are (thus) more than twice as likely to work with external organisations to innovate, compared with the least digitally mature businesses.
Resource: MIT Sloan