In the 2014 list of most innovative companies, released by The Boston Consulting Group (BCG), technology and telecommunications companies once again lead the pack, holding down all of the top 5 spots in 2014, 7 of the top 10, and 21 of the top 50—the most since 2010. The consumer products industry holds 14 of the top 50 spots, also the most since 2010.
BCG has surveyed more than 1,500 senior executives in a wide range of countries and industries since 2004 to help cast light on the state of innovation in global business. In its new report, The Most Innovative Companies 2014: Breaking Through Is Hard to Do, the firm reveals the 50 companies that international executives ranked as the most innovative. Many of these companies have demonstrated impressive staying power over the years:
The biggest change in the 2014 top 50 list is the decline in the number of auto companies. Only 9 auto companies are in the top 50 in 2014, and only 4 ranked in the top 20. This compares with 3 automakers in the top 10 places in 2013, as well as 9 in the top 20, and 14 in the top 50 spots. Automakers also reported both a 26 percent decline in innovation priority, with 62 percent assigning it a top-three position, down from 84 percent last year.
In 2014, BCG again asked respondents to name up-and-coming companies—companies that are still relatively young or have yet to reach the scale of the top 50 global giants but are making themselves known for innovation. WhatsApp, Square, Rakuten and Wipro lead this list. There was 50 percent turnover on the up-and-coming list, with only four companies returning from 2013. Last year’s up-and-comers all leveraged mobile platforms in one way or another; this year’s list comprises more varied innovators: consumer products, auto, media, and big-data companies.
“Innovation isn’t getting any easier. Too many companies want to shoot for the moon while their innovation programs are barely airborne,” said Neeraj Aggarwal, a BCG Senior Partner & Director. “It is no longer enough to be good at incremental innovation. Breakthrough innovators are especially effective at bringing together the pieces required for radical innovation such as management, governance, and organizational design that can have a major impact on any company’s innovation program. Breakthrough innovators corral them all.”
The 2014 survey found that only 13 percent of respondents have a significant ambition to deliver radical innovation. More than 40 percent of these would-be disruptors indicated that their companies’ innovation capabilities are average at best. Executives from companies with strong innovation capabilities—and disruptive ambitions—represent just 7.6 percent of the sample.
While technology companies lead the list of those seen as most innovative, respondents in multiple sectors said that there will be limited impact from digital technologies in their own industries in the next three to five years. Less than half of the respondents in the telecommunications, financial services, pharmaceuticals, consumer products, retail, energy, and manufacturing sectors, among others, said that big data and mobile will have a big impact. Less than a third in each sector said that their companies are targeting big data and mobile in the innovation programs.