Investigating South Africa’s Innovation Landscape

Organisations the world over are thinking about new ways to remain relevant and ensure future success. For many, building an internal innovation capability forms an integral part of a strategy for future growth. Business trends further suggests that amongst other things, the organisation’s ability to collaborate with various stakeholders across its value chain will become increasingly important.

From a local perspective, the same is true for South Africa – we need to do things differently. Our local business context is, in many ways similar to that of global organisations as we deal with the same issues, yet it is tied to our own unique opportunities and constraints. Strategic planning for growth in South Africa needs to take cognisance of global innovation trends while remaining anchored in local relevance. When South Africa’s top organisations start innovating, the impact on our GDP will be exponential. This needs to be encouraged, celebrated and communicated so that collectively, as a nation we grow and solve social ills by means of our ability to sustainably innovative.

In an effort to showcase the country’s top innovation leaders and recognise South African innovation excellence, Innocentrix, an innovation business and technology services company, recently carried out a study to place the spotlight on innovation within South Africa’s top organisations. The aim was to do exactly what was mentioned above, to gain insights into our local innovation landscape and to share these across industry to encourage learning.

An Innovation League ranking innovative local organisations

The Innocentrix Innovation League study explored organisations’ approaches to innovation management. It examined if and how organisations recognise innovation as key to establishing or maintaining a competitive advantage, whether our leadership styles, corporate culture and implementation strategies are working and whether the necessary resources are being made available to ensure growth and sustainability.

The Innovation League was conducted using the internationally recognised Innovation Readiness Model (IRM), developed by French business school INSEAD and UK IT and management consultancy fi­rm, Logica. The IRM has a unique way of benchmarking an organisation’s innovation readiness, meaning an organisation’s ability to apply leading edge thinking to the topic of collaborative innovation.

The pillars of collaborative innovation success

Four pillars of achievement were studied in the process. These pillars can be viewed as the foundation on which organisations can build sustainable collaborative innovation. They are:

  1. Leadership & Ambition
  2. Organisation & Collaboration
  3. Implementation & Measurement
  4. People & Culture

Revealing local results

Overall, South African organisations scored relatively well on average, but specific strengths and weaknesses are evident: South African organisations appear to be head-strong, with high scores on the Leadership and Ambition pillar. People and Culture follows closely behind with the second highest score, showing a capacity and willingness for innovation within company employees. Where South Africa falls a bit behind is in both the Organisation and Collaboration, as well as the Implementation and Measurement pillars. There seems to be strong resistance to the idea of collaboration between organisations, with only a handful really achieving successful collaborative partnerships. It would also appear that innovative ideas are often generated, sometimes implemented, but rarely properly measured to show the true capacity for return on investment. The pillars will be extrapolated on below:

Leadership and Ambition

South Africa’s strength lies in its leadership for innovation. There is no doubt that local organisations understand the innovation imperative and that leadership is taking responsibility. Seventy seven percent (77%) of the organisations surveyed said that innovation responsibility resides at CEO level.

People and Culture

Our local corporate culture portrays a picture of employees that have a willingness to change. Sixty three percent (63%) believed that people understood their roles and responsibilities in terms of innovation. It was evident that resources are allocated in this regard, but not sufficiently. The greatest challenge was funding, time for innovation, a fear of failure and risk adversity in general.

Organisation and Collaboration

Apart from a couple of organisations that really started to build competencies in this area, most were not doing a good job of it. Although 66.5% agreed that their organisations have a well implemented processes for innovation, it was evident that this did not allow for effective internal or external collaboration and that outcomes were not strategically aligned to deliver value. As far as collaboration were concerned, local organisations seem to be collaborating with experts first, then with suppliers and thirdly with research institutions like universities. Open innovation is a concept that is gradually better understood but few organisations have applied their minds towards its execution.

Implementation and Measurement

The greatest challenge for organisations were implementation and measurement in terms of innovation ROI. Budget seemed to be the most pressing problem while resource constraints and conflicting work demands made things worse. Innovation measurement was also not high on the agenda (with just over 50% benchmark activities in this regard) and implementation in general took place in an ad-hoc manner.

How do we do compared to international organisations?

When comparing South Africa’s innovation potential to that of the international sphere, we see that South African organisations still have a little while to go. Even though some of the pillars score highly, our average score is lacking. We do, though, compete quite closely with France, but still have some improvements to make before we can compare with the innovation potential of countries like the Netherlands or UK.

InnoLeague 2015 SA Results

The Way Forward

Although the picture is still not entirely rosy from a local perspective, we are making progress: South Africans are hitting the headlines internationally, and we are con­fident in our ability to bring new innovations to the world-market. From an innovation perspective however, applying and implementing our local innovation genius remains a challenge.