How Much Are You Spending on Innovation?

The CIMS Innovation Management Report, published six times a year, is jam-packed with informative, thorough articles on research in the field of innovation management and the management of technology, whether it’s being done by CIMS researchers or fellows or by other thought leaders. Here’s an excerpt from the January-February issue focusing on how much money companies allocate to innovation. Hint: It’s not enough.

By Mike Wolff

Editor, CIMS Innovation Management Report

Corporate leaders believe innovation should be a priority, but nearly half of their companies are investing less than 2% of their annual budgets on innovation. That’s the report from 200 middle and senior managers in 154 organizations surveyed by Imaginatik.

The innovation consulting/advisory firm conducted its State of Global Innovation Survey in May 2015 to assess how innovative today’s mid-and large-sized organizations have become. Responding companies had more than 200 employees and represented a wide range of industries, particularly manufacturing, consumer products, and business and financial services. Among the survey highlights:

The desire to keep up with changing customer needs drives innovation for 61% of responding companies.

  • Nearly 40% have no formal process for innovation.
  • 55% reported their biggest challenge is changing the mindset of their corporate culture to support innovation (see figure).
  • And 50% called turning ideas into tangible results the biggest obstacle in their innovation process.

    Source: Imaginatik

    Source: Imaginatik

“Over and over,” recalled the writers, “we heard that companies have plenty of good ideas, but struggle to keep promising innovation projects from falling into a black hole. As one respondent put it: ‘(the innovation pipeline) looks more like a tunnel than a funnel.’

“This problem becomes even more difficult when organizational attention is consistently placed on short-term business interests: ‘In a resource constrained cyclical business, when we are slow we cut overhead (innovation projects), and when we are busy we are focused on execution’.”

Still, the report concluded on a hopeful note: “A growing number of organizations in our 2015 study voiced cautious tones of confidence. For many, innovation programs have weathered enough storms that the future is at least reasonably secure, if not yet entirely well defined. More of the obstacles and constraints are well known, and thus the path to success is more obvious than before.”

“In our 2015 survey,” Chief Marketing Officer Chris Townsend told IMR, “a growing number of companies recognize that building innovation capabilities cannot be just a series of quick-fixes. It’s also necessarily a longer-term process of change leadership and institution-building.”

Download the full report from http://imaginatik.com/landing/state-global-innovation-2015

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