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Innovation for peak performance

Ongoing economic uncertainty and increasingly fierce global competition are forcing companies to place greater emphasis on R&D excellence.

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For powerful innovators over 5% revenue invested in R&D generates over 20% of revenu from new products

Explore the connection between R&D and revenue generation and understand why a conservative approach to innovation could be holding your business back.

In our study, 'Innovation for peak performance', we set out to establish the key components of a successful innovation strategy in energy-intensive industries. We surveyed 61 participants from 14 countries, across the mechanical engineering, high-tech, consumer goods and automotive industries.

From our analysis, we judged high-tech, automotive and mechanical engineering to be ‘powerful innovators’, in that they invest over 5% of their revenue in R&D and generate over 20% of revenues from new products. Consumer goods companies invest less and have smaller revenues from new products as a result.

We found that the conservative approach to innovation, focusing on existing customers and products, is still in vogue – there is limited appetite for the diversification that would create new growth opportunities.

Some key insights from the report

If we compare companies' R&D investment with the revenue from new products (NPR) that they achieve as a result, as a percentage of total company revenue, we identify four distinct type of innovator.

Different sectors clustered to compare R&D spend against new product revenue

Open innovation is on the rise. In the next decade, internal models will decrease by 23% and collaboration networks will increase by 50%.

Open innovation is on the rise From all respondents; 50% rely on R&D employees. 10% frequently cooperate with technology partners

Less navel-gazing

A shift towards more collaborative and open models, especially collaboration networks, has started.

But more than 50% of responding companies continue to rely on R&D employees, while only 10% frequently cooperate with technology partners.

Innovation is going global – more than 60% of the respondents consider Asia as a growth region for R&D investments.

Innovation is going global R&D is going East

R&D spend is going East

China was ranked by 70% of all respondents as the country where the highest growth in R&D investment might occur in the upcoming years.

North America and Europe remain stable with similar priorities for the companies to invest in these two regions.





% of respondents ranking R&D growth potential

R&D efficiency presents a new dilemma – companies should reduce their time-to-market if they want to stay competitive.

12% reduction target in time-to-market within ten years Time-to-market across sectors and % reduction target

Based on our findings, we have developed an agenda for companies to achieve innovation for peak performance across innovation strategy, global R&D footprint and R&D efficiency.

To find out more about the innovation agenda for your business

Download the full report

Panorama excellence survey








PA Consulting Group in Switzerland

Thibaud Gigandet

Thibaud Gigandet

Chris Isler

Chris Isler

David Vaury

David Vaury

Nicolas Prime

Nicolas Prime

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