06
03
INNOVATION AS
COMPETITIVE EDGE
Fortunately, MNCs have already begun to appreciate the
impact and pace of China’s innovation catch-up process and
are starting to react. Nearly 70% of all interviewed MNCs
stated that driving innovation in China is one of their Top 3
business priorities within the next three years (see fig. 03).
Interestingly, 25% of interviewees have identified innovation
as the Number 1 priority on their agenda.
FIG. 03 І INNOVATION HAS HIGHEST PRIORITY
What is the degree of priority for innovation in
your Chinese entity in the next three years?
59%
of survey participants
have no well-defined
innovation road map
2 1
3
In addition, multinationals have begun to realize the central
role that innovation plays in developing customer-specific
products: 80% of interviewed companies consider innovation
to be a vital instrument for meeting local customer needs
(see fig. 04). Furthermore, innovation is seen as an efficient
means to differentiate from competition (77% of interviewed
companies) and attract new customers (70% of interviewed
companies).
AMONG TOP 3 PRIORITY:
67%
TOP 1 PRIORITY:
25%
FIG. 04 І DRIVERS OF INNOVATION
80% 77% 70% 55%
%
MEET
CUSTOMER
NEEDS
DIFFERENTIATE
ATTRACT
NEW
CUSTOMERS
INCREASE
MARGINS
Yet, despite the high priority assigned to innovation, MNCs
need to significantly increase their efforts when it comes to
developing an innovation agenda: Nearly 60% of surveyed
companies have no well-defined innovation road map in
place! ||