By Valerio Nannini, Founder & CEO, Nannini Partners Ltd.

Innovation is no longer confined to select companies or sectors. In today’s fast-paced, tech-driven world, businesses of all sizes and industries must embrace innovation to stay competitive. This means breaking down barriers, whether to the flow of ideas, talent, or resources, and fostering connections that transform insights into tangible outcomes.

This universal demand for innovation has raised the stakes. Companies are under pressure to cultivate, manage, and measure innovation efforts to deliver both business value and financial returns. Increasingly, success depends on opening up the innovation process to employees, customers, and external partners.

To understand how companies are navigating this challenge, we’ve explored the strategies of those managing innovation initiatives. Here’s what they’ve learned about building value through innovation, across dimensions like strategy, culture, and metrics.

1. Enlist a Diverse Team

Innovation thrives on diversity. Companies must engage a broad mix of employees, customers, and partners right from the ideation stage to ensure alignment between innovation and business goals.

Research indicates that organisations with diverse teams are 1.7 times more likely to be innovation leaders in their market. McKinsey & Company

By involving these groups early, businesses increase their chances of delivering products and services that resonate with end-users while driving measurable financial outcomes.

2. Adopt Inclusive Operating Models

Bringing new voices into the innovation process delivers significant benefits, from uncovering fresh ideas to accelerating time-to-market. This is why forward-thinking companies have embraced inclusive methodologies like open innovation, design thinking, and lean start-up principles.

According to PwC’s 2024 Global Annual Review, 45% of CEOs believe their companies will not be viable in ten years if they do not change course, highlighting the need for innovative operating models. PwC

Such approaches enable organisations to reduce risks, fail fast, and refine their innovations in real-time.

3. Look Beyond Your Organization

Leading innovators don’t work in isolation. They integrate insights from a broader ecosystem of partners, customers, and technology providers to identify and address unmet needs.

A 2023 McKinsey report found that companies leveraging external partnerships for innovation are more likely to achieve significant growth. McKinsey & Company

This collaborative approach helps companies uncover untapped opportunities and deliver solutions that align with market demand.

4. Big Companies, Big Opportunities

Larger companies, with their expansive resources, are uniquely positioned to drive breakthrough innovation. McKinsey’s 2023 analysis revealed that leading innovators delivered growth at a rate of 16% above that of the least innovative. McKinsey & Company

These businesses also lead in adopting advanced methodologies like reverse innovation, which involves exporting ideas developed for emerging markets back to developed ones.

5. Break Down Organisational Walls

To maximise the impact of innovation, businesses must dismantle silos and foster horizontal collaboration across departments and industries. While smaller firms excel at agility, larger enterprises are increasingly leveraging their scale to adopt collaborative frameworks like design thinking.

McKinsey’s 2023 report on organisational health emphasises the importance of cross-functional teams in driving innovation. McKinsey & Company

This approach ensures alignment between strategy and execution.

6. The Role of Open Innovation

Open innovation has proven transformative, enabling companies to tackle complex challenges collaboratively. Yet, a common hurdle persists: many stakeholders still view open-source methods as a challenge to their expertise.

A 2023 study highlighted that organisations embracing open innovation frameworks are better positioned to meet evolving market demands. McKinsey & Company

Addressing this requires fostering an innovation culture where collaboration is valued over competition, and where leaders actively bridge the gap between strategy and execution.

7. Prioritise Human Experience

Innovation isn’t solely about technology; it’s about people. Human insights are critical for shaping solutions that resonate with real-world needs.

For example, while AI and big data can reveal consumer behaviour patterns, they don’t explain the underlying motivations. This is where human intuition and soft skills come into play. A 2023 McKinsey article emphasises the importance of combining data with qualitative insights to drive customer satisfaction. McKinsey & Company

8. C-Suite Leadership is Key

Innovation thrives under strong leadership. Executives play a pivotal role in setting the tone for innovation, aligning efforts with business objectives, and securing buy-in across the organisation.

PwC’s 2024 Global Annual Review highlights that business leaders recognize the need for transformation to remain viable in the coming decade. PwC

Aligning Innovation with Business Strategy

As organisations invest more in innovation, it’s critical to align these efforts with their overarching business goals. Success lies in crafting future-ready business models that support innovation, ensuring that spending drives measurable outcomes.

Inclusive frameworks like design thinking and co-creation are no longer optional, they’re essential for navigating today’s competitive landscape. By balancing creativity with strategy, companies can unlock sustainable growth and position themselves as industry leaders.

To explore how innovation can transform your business, visit nanninipartners.com.