South Africans are rightly proud of some of the world class innovations that have emerged from our country. We tell ourselves stories of the first successful human heart transplant, and the invention of the Kreepy Krauly automatic pool cleaner.

Accenture conducted research into innovation in South Africa, and benchmarked it with companies across the world using our Innovation Maturity Index.

Disappointingly, South Africa scored on average 54 out of 100. A small group — only one company in 15 (7%) averaged 68% — which is still eight points lower than the 76-point average of Global Innovation Champions.

South African companies simply don’t seem to be moving at the same speed as the technology is developing around them.

Alarmingly, the gap between the high-growth companies and the rest is widening as the pace of change accelerates.

High growth companies have built the innovation skills to create new products and services for customers, and more importantly, have achieved deep organisational change. This innovation maturity allows these companies to release trapped value more effectively than their peers.

But high growth depends on more than just innovation capability.

Our research shows that the really high performers have managed what we call the “wise pivot,” which re-contextualises their current organisational effectiveness and sources of profit while simultaneously exploiting new opportunities.

What does that even mean?

Successful companies are engaging in a balancing act. If they dash towards new technologies, markets and products, they risk over-investing in unproven approaches, and find themselves caught short when it comes to investing in their core business.

But if they over-invest in the core business, they may not be in a position to capitalise on the new opportunities and could be left high and dry when their original business model becomes outdated or disrupted.

The “wise pivot” is how we describe the actions successful companies have taken to manage this dilemma

Their approach to organizational change is to constantly re-invent themselves. This lets them manage their core business assets as a dynamic portfolio through the lens of three lifecycle changes — the “old”, the “now,” and the “new.”

It also provides them a roadmap to transition their core business successfully into one built on new technologies and offerings.

Their priorities are as follows:

* Get really efficient and profitable so that they have some capacity to invest in “the new”.

* Take the existing core business, and grow it to sustain the fuel for expansion into new revenue pools. This is an “innovation light” approach of finding new customers or new markets for existing products and services. Or tweaking the customer experience to improve it, and thereby growing the core.

* Then it’s time for the big guns. Identify the “new” and start scaling growth areas, fast. Innovations must be commercialized and brought to mass market quickly. Promising avenues must be pursued and dead ends quickly abandoned.

Our research suggests that while achieving the right balance — between nurturing and growing the core on the one hand, and pivoting to the “new” on the other — is both difficult and scary, it is possible for companies to carefully scale and time their investments.

Interestingly, South African companies prioritize innovation. We found no difference between leaders and “rest of the market” companies in terms of pursuing innovation and even encouraging an innovation culture.

What makes the difference is that successful companies implement an “innovation architecture,” which I’ve written about in previous blogs. In other words, SA companies are good at coming up with great ideas; they are falling behind in turning those ideas into products, commercializing them, and aggressively growing the “new”.

To recap: high growth companies have a strategy that prioritises innovation; they strengthen and grow their core to give them the ability to invest in innovation; they have an innovation architecture that commercializes their new ideas quickly and effectively.

There’s on more thing that successful companies do well: they differentiate themselves in their use of data. In fact, it’s the “alpha trend” of innovative companies.

That’s because good data helps companies both grow their core to become more profitable in the “now”, as well as identify opportunities and set up the analytics and AI capability to power their “new.”

For more information on Accenture’s innovation maturity index, you can read the full report here: Winning in the age of disruption. And please contact me anytime for a chat about your innovation strategy.