Innovation Systems Need a Reboot

Here’s a paradox. Companies have never placed a higher priority on innovation—yet they have never been as unready to deliver on their innovation aspirations. It’s a recipe for disappointment. BCG’s 2024 Most Innovative Companies report examines the readiness gap and offers perspectives on how companies can get back on track.

A Troubling Innovation Readiness Gap

We first discussed the readiness gap in our 2021 Most Innovative Companies report. At the time, 20% of companies scored as “ready” based on BCG’s proprietary Innovation-to-Impact benchmark—despite 75% ranking innovation a top-three priority. Today, our 2024 research finds 83% of companies seeing innovation as a top-three priority, but only 3% ready to translate their priorities to results.

On readiness, 2024’s top-quartile innovator underperforms 2022’s median innovator. It’s a call for urgent action. Download the report or read the chapter for more.

Read Chapter 1: Innovation in 2024

Combating Zombies with Strategy

Readiness has declined most sharply in those aspects of the innovation system that link business strategy to innovation strategy. And executives feel it: just 12% say their company has a strong link between the two. However, innovation activity—the number of projects going through the funnel—has remained steady, evoking a troubling image: "zombie" innovation systems just going through the motions.

A strong link to business strategy focuses innovation investment—and it also delivers better innovation output. Strategy-led innovators achieve a share of revenue from new products 74% higher than companies with just a weak link between strategy and innovation. It’s time for innovators to recommit to strategy. Download the report or read the chapter for more.

Read Chapter 2: To Close the Innovation Readiness Gap, Start with Strategy

GenAI as an Innovation Accelerator

While 86% percent of innovators in our research are experimenting with GenAI to at least some degree, ready innovators are moving out ahead. They’re applying GenAI more frequently in a single use case and are five times more likely to have applied it at scale.

And GenAI can be a powerful tool in helping organizations reshape their innovation systems for greater readiness. We spotlight ten use cases that span the three phases of the innovation cycle: strategize, create, and scale. Download the report or read the chapter for more.

Read Chapter 3: Accelerating Innovation with GenAI

Innovators, it’s time to get ready.