Why is innovation important?

Successful innovation is strongly linked to financial performance. Innovation is a key driver of economic growth. It also brings wider benefits for society. Ideas and discoveries improve our standard of living. Innovation can also lead to better standards of safety, better health care, better quality products, and products and services that are better for the environment. Innovation has increased our productivity far beyond that of previous generations and has fundamentally changed the way we live and all aspects of our lives. Innovation and education are key ingredients to our global success in a knowledge economy.

Our fast-changing world brings challenges and opportunities for businesses. Innovation can help businesses make the most of these changes. Changing customer needs and expectations, changing competitors, changing technology, changing external regulatory environment, and an increasingly global and dynamic marketplace - all bring opportunities for innovation. Innovation can lower the cost of production, build new markets and increase competitiveness. Innovation can drive performance by building profitability, generating employment and increasing market share and growth.

The figure below displays advantages of performing innovation at companies.

Figure 2: Benefits for firm from innovation

Please stop and think: Have you thought about innovation in your company? Are your products or services still competitive in the market? Do actual and production costs estimate significant figure in the turnover in your company? Maybe it's worth thinking about?

Sony releases 5,000 new products per year. A laptop's expected life is now only two years. Drug development is down from ten years to four years. There has never been a time when more products and services were being launched or when new technologies were being introduced to the market ever more rapidly.1

The winning firms of the next ten years will be those that embrace innovation and build it as a core capability.

If you aren't innovating your competitors are! If you do not innovate, you compete on price only!

1 A CSC White Paper, European Office of Technology and Innovation. What Innovation Is. How companies develop operating systems for innovation, p.6