Study: Telecom lagging in innovation approach, successes

Telecom service providers are focused too much on making small, incremental changes to their business rather than embracing the kind of innovation that will allow them to compete with – and beat – a growing bevy of rivals, according to a new study from systems integrator and consulting firm Accenture.

The study, released this week and conducted in May, was actually a compendium of several surveys, including one of more than 600 executives across a broad range of industries; a second online survey of almost 300 executives in communications and other high-tech firms; and a follow-up interview series with 28 top-level executives from the world’s largest high-tech firms.

That enabled Accenture to not only evaluate telecom’s approach to innovation, but compare it to other industry efforts and processes as well.

In analyzing the results, Accenture consultants found that high-tech – and communications companies in particular – are losing what they call “the innovation battle” due to flaws in how they think about and formally pursue innovation within their organizations.

The findings track with Connected Planet’s own recent cover story on innovation (The Innovation Blueprint), which posited (and included interviews with two Accenture telecom executives) that service providers must radically rethink what it means to innovate in today’s more connected markets.

“In the global battle for innovation, many companies are not realizing the value they should be getting from their investments,” said Adi Alon is a Senior Executive in Accenture’s Growth and Innovation practice, in an interview.

In particular, Alon pointed to three main problems: companies don’t manage innovation as a process, with dedicated tools, governance and budget; innovation is too often stuck in divisional silos with little influence from the outside; and the goals of innovation efforts are too often “incremental,” focused only on minor changes and fixes.

It’s that last area that represents the communications sector’s biggest challenge, Alon said.