Every company, in every industry, needs an innovation strategy — whether it be high-tech product innovation, packaging innovation in consumer goods, or process innovation at financial services companies. Now more than ever, innovation is key to growth, to acquiring and sustaining competitive advantage, and to building shareholder value for the long term. At the same time, the innovation process is fast becoming more open, and more global: Setting up shop in local markets around the world and getting customers more involved in innovation efforts are now a vital part of any successful innovation effort.
Developing a powerful innovation capability is no easy task. PwC’s strategy consulting team PwC’s innovation practice has demonstrated again and again, in its annual Global Innovation 1000 research, that there is no correlation between the amount of money a company spends on research and development and its overall financial results. Instead, success depends on a variety of factors, including a company’s openness to new ideas, its ability to manage innovation projects from conception to market introduction, to kill projects early on, if necessary, and to tie new-product development tightly to specific sales, marketing and financial goals.
Since the 1950s, when it introduced the concept of product life-cycle management in the seminal article “How to Organize for New Products” in the Harvard Business Review and created the PERT (Project Evaluation and Review Technique) methodology to streamline the U.S. Navy’s development of the Polaris missile, PwC has been a trusted innovation advisor.
Our innovation experts can help clients improve their innovation functions, including new-product development, research and development, and engineering. We advise companies on setting strategy, making needed process and organizational changes, building new innovation capabilities, and assessing the scientific and technological robustness of their offerings. Our proven expertise in these areas, combined with our rich industry insight, allows us to identify innovation strategies and processes that are both technically and economically sound.
Our product profitability service offering helps clients design their products for maximized customer and end-user value, while maintaining cost effectiveness in the delivery of that value.
Product profitability cannot simply be about cost reduction. We believe that significant improvements in product profitability, whether from pricing or margin improvement, must begin by capturing real insights into customers and markets, and then understanding, targeting, and delivering the right “value mix.” A comprehensive focus on both top-line and bottom-line levers helps improve product competitiveness and drive increased profitability.
By focusing on the top-line, we can help clients quantify and translate customer insights and needs into advantaged product concepts and feature sets — together with an understanding of the willingness of customers to pay for them. Advantaged products drive superior competitive positioning, and that, in turn, drives higher sales.
Our bottom-line focus helps companies deliver advantaged products and feature sets to customers at the lowest possible price. Our goal is to reduce basic product or service “functional” costs and then reinvest the savings into product features and consistent quality, attributes that create real and perceived value in the minds of customers.