US edges China as global hotspot for disruptive innovation
Global tech leaders believe disruptive innovation is most likely to come from the US, a new study has found, but China is catching up quick on its rival technology superpower.
C-Suite leaders in the technology industry still consider the US the most likely market for disruptive innovation to emerge. China ranks a close second with a quarter of industry leaders believing the world’s second largest economy has the most potential to unleash radical change on the tech sector.
KPMG’s global survey found that a sizable minority of the 841 leaders consulted viewed India and the UK as leading lights in the innovation sphere. Asked which countries show the most promise for disruptive technology breakthroughs that will have a global impact, 11% said India and 10% cited the UK.
The US and China jostled for supremacy, with 26% favoring the home of Silicon Valley and 25% looking east to innovation hotspots such as Shenzhen. Broken down by region, elements of local pride could be detected. Almost half (49%) of American leaders said the US showed the most promise, while 59% of Chinese respondents expected the next wave of global change to originate in China.
Respondents ranked Shanghai as the world’s top city for tech innovation. New York came second and was complemented by Washington DC, Boston, and Chicago in the global top ten. Beijing also made the list, making six of the top ten cities either American or Chinese. Together the dynamic rivals have been described as the “world’s only true technology superpowers,” by Richard Ji, cofounder of Asia All-Stars Investment.
Despite narrowly edging out the competition, US-based innovators have no room for complacency. A similar poll conducted by KPMG in 2016 found that 29% expected the US market to generate globally disruptive technology, showing that C-Street’s confidence in the US has since dipped.
China’s threat to American tech hegemony is perceived as a bottom up phenomenon, KPMG’s research showed, with lavish R&D spending expected to strike gold sooner rather than later. But North America easily leads the pack when it comes to visionary corporate leadership.
Asked to identify the world’s pioneering leaders in innovation, the 841 industry chiefs settled on Tesla’s Elon Musk as number one. Tim Cook, CEO of Apple Inc, took second spot and Alphabet’s Larry Page and Sundar Pichai shared third spot with Jack Ma, executive chairman of Alibaba Group and the only Chinese national in the top five.
CEOs, however, are not perceived as the key idea generators. More than a third (35%) of global leaders in the KPMG survey identified the Chief Innovation Officer as the person most likely to initiate disruptive change. Another 17% thought the Chief Information Officer was the person for the job. Just 6% considered CEO’s to be the main innovation strategists, well behind corporate development on 12%.
Measuring innovation
Digging a little deeper, KPMG also asked its sample of global leaders how they measure the value of innovation to an organisation. Calculations are difficult in a field where hundreds of patents can be made redundant overnight by a major technological breakthrough.
As a yardstick patents still came out on top, noted by 35% of respondents as the best metric for determining success. Revenue growth was a close second cited by 34%. Other important metrics were brand/reputation barometer (33%) and market share (32%). Market value and ROI were also identified as valuable indicators.
Asked to rank the top factors for enabling technological innovation, the ‘availability of talent’ topped the list. US-based leaders were more likely to view ‘access to tech infrastructure’ as the critical enabler for innovation. Access to capital and R&D partnerships were other vital factors.
Leaders were also asked to identify a single approach they considered best to build and sustain an innovative corporate culture. Financial incentives came out on top globally and among US-based leaders. Career progression was second, while time allocation shared third spot with recognition (both internal and external).
