Innovation of new products and services has been rated by global CEOs as the optimal route to growth and is preferred over other means like mergers and acquisitions and joint ventures for increasing market share, says a survey.
According to a study conducted by PwC among 1,200 CEOs from around the world, innovation -- along with increasing their existing business -- now outstrips all other ways for potential expansion, including moving into new markets, mergers and acquisitions, joint ventures and other alliances.
The survey said that innovation is high on the executive agenda in virtually every industry.
In all, 78% of the CEOs surveyed believe innovation will generate 'significant' new revenue and cost reduction opportunities over the next three years.
"Innovation is a matter of survival for companies in sectors facing rapid changes in technology and high customer expectations," PwC US Partner and Business Leader (Innovation and Strategy) John Sviokla said.
"Forward-looking companies strive for innovations that will give them a competitive advantage and create growth. In today's fast-moving environment, companies must constantly improve and re-invent their products, services and even brands," Sviokla added.
In both the pharmaceutical and entertainment and media sectors, more than 40% of CEOs believe their greatest opportunities for growth come from spawning new products and services.
In addition, the survey found that CEOs are re-thinking their approach to innovation and increasingly seeking to collaborate with outside partners and in markets other than where they are based.
"In mature markets, companies must innovate to differentiate themselves; in emerging markets, they need innovation to lessen their dependence on lower costs," Sviokla added.