Tech Sector Innovation Hotbed
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The technology industry is a high performer in terms of generating growth through innovation, but will need to increase the volume and frequency of new products and services to sustain this performance, according to a new global survey by international consultancy firm PricewaterhouseCoopers.
The survey found that based on the percentage of revenue generated from new products and services, the technology sector (69 percent) leads 26 other industry sectors, its nearest rival being the energy sector (50 percent).
The 'Innovation and Growth: A Global Perspective' survey report is based on responses from board directors of 800 organizations throughout the U.S., UK, France, Germany, Spain, Australia and Japan.
"The fast-changing nature of the technology sector, particularly the explosion in e-business, is clearly a significant driver in its performance," said TICE industry group leader Martyn Mitchell, "and we can be proud that a considerable level of innovation exists in our own backyard."
Mitchell said this constituted a warning for the technology sector. "Given a general trend towards competition through new products and services and a high, but unpredictable failure rate, companies will need to increase the volume and frequency of new products and services to sustain their good performance on profitable growth from new products," he said.
Mitchell also said there would be continuing pressure to increase the level of innovation in new products and services in order to sustain performance. "Increasingly, it will not be enough to be new. You will have to be very new."
Another area of concern for technology companies is their relatively poor performance on time to market. According to the report, electronics and computing companies typically took 40 weeks to get new products and services to market.
The survey found a close link between financial performance and time to market, with the top five percent of companies (across all industries) typically taking less than 16 weeks to get new products and services to market. "Fundamentally, technology companies must find ways of speeding up their innovation processes," said Mitchell.