Getting innovations to the market quickly and successfully - more than ever this will be the future challenge for small and medium sized industrial companies. In the course of Industry 4.0, innovation cycles will become significantly shorter. In addition, there will be new competitors: China is catching up in terms of technology, and IT companies such as Google discover industrial products as future sources of income.
by Martin Haas, CEO, STAUFEN AG
To continue maintaining its market position successfully in the future, industry must organise its innovation activities significantly more efficiently. The “Industry Monitor: Innovation 2015” by the Staufen consultancy confirms the huge potential in this area.
Worth noting: Almost one in two industrial companies in Germany derive less than ten per cent of their total revenue from products at the start of their life circle. It is only in the automotive sector that market innovations generate significantly higher profits.
No doubt, a revenue share of ten percent for market innovations is too small. The aim should be for one in five Euro of the total revenue to be generated from innovations. The feasibility of such a leap in revenue from innovations demonstrates the practical example SEW Eurodrive. The gear specialist was able to increase its revenue share from new products from 5 to 25 % thanks to its efficient and effective innovation efforts.
Launching innovations onto the market in a shorter time is only possible with the inclusion of all departments of a company and the involvement of external partners. Both of those factors, however, are not nearly sufficiently prevalent now.
The study also shows: The focus of research activity in industry continues to be mainly on product developments: machines are to become better and more powerful.
However, innovation encompasses much more. A company is innovative if the striving for innovation extend to business models, processes and structures. Generally, products can be easily analysed and copied, but this is hardly possible for innovative structures and processes. For that reason, the latter constitute a sustainable competitive advantage. In addition, they ensure that companies launch new products regularly and not merely strike lucky occasionally.
STAUFEN AG will be attending our IndustryForum Automotive event in Germany on the 22nd of November 2016 as a solution provider.
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