Innovation appetite, spending low: PwC
18 Dec, 2013, 07:00 ET
Canadian findings show companies do not have innovation top-of-mind
TORONTO, Dec. 18, 2013 /CNW/ - Canadian technology, entertainment and communications companies are struggling with innovation—enthusiasm is low, and businesses are not making it a priority when it comes to allocating funding or resources.
According to PwC's Global Innovation Survey, while nearly nine in ten (88%) Canadian companies in this sector are aiming for at least moderate growth over the next five years, only 27% have an eager appetite for innovation. Although this figure sits slightly above the global average (21%), competitors worldwide are still spending more: Canadian businesses are allocating just 7.8% of their revenue ($21 million) to innovation, compared to 10.38% ($111 million) in the UK and 9.64% ($200 million) globally. In fact, Canadian businesses are far more likely to rely on the government to fund the innovation programs they do initiate, with half of the respondents in these categories relying on federal and provincial incentives.
Respondents in these industries also lack the structures necessary to effectively manage innovation. And, even though Canadian companies are more likely than their global counterparts to think that having innovation structures is important, they are in fact less likely to actually have them in place.
"In Canada and worldwide, enthusiasm for innovation is low—and this is reflected in how much is spent on these initiatives," says Darren Henderson, National Technology and Communications Consulting & Deals Leader at PwC. "Part of the issue, however, is in the lack of frameworks and processes needed to build an innovative culture. Building the necessary structures starts at the top, but everyone in an organization has a role to play in bringing new ideas and creative thinking to the table."
In terms of where companies are looking at innovating, products rank at the top of Canadian businesses' lists, with 35% indicating this as a high priority—well ahead of customer experience (8%) and business models (4%). And, it looks to be a competitive space to play in, as both the US and the UK also list products among their top areas to innovate.
"In the technology, communications and entertainment sectors, companies need to set themselves apart, and these results show that to do this, businesses feel that product innovation is the way to go," says Henderson. "Product innovation is a key growth driver, but innovation is a total package, and one that is essential to the success of industries like these that thrive on new ideas. An eye to innovation is crucial and means looking at everything from the business model to the customer experience to the corporate culture."
About the Global Innovation Survey
The largest and most comprehensive study of its kind, PwC's Global Innovation Survey gathered insights from 1,757 C-suite and board-level executives from more than 25 countries across more than 30 sectors. For the first time, Canadian executives shared their experiences in this study to explore three key areas: how they're using innovation to drive growth; how approaches to innovation are changing; and how they're delivering tangible results..
Findings from the Global Innovation Survey are included in the global report - Breakthrough Innovation and Growth and a Canadian report with sector specific results, both available online or from the media contacts.
About PwC Canada
PwC Canada helps organizations and individuals create the value they're looking for. More than 5,700 partners and staff in offices across the country are committed to delivering quality in assurance, tax, consulting and deals services. PwC Canada is a member of the PwC network of firms with more than 180,000 people in 158 countries. Find out more by visiting us at www.pwc.com/ca.
Follow PwC on Twitter at @PwC_Canada_LLP and on Facebook at www.facebook.com/pwccanada.
© 2013 PricewaterhouseCoopers LLP, an Ontario limited liability partnership. All rights reserved.
PwC refers to the Canadian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details.
SOURCE: PwC (PricewaterhouseCoopers)
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