Cos find innovation as tool to beat competition: E&Y

A study has found that after the recent downturn, domestic companies are innovating in an unprecedented manner, to beat competition and remain relevant to their target customer base in a fast changing marketplace.

As business volatility continues to go up, companies see innovations in products, services and operations as the most potent tools to beat competition in the next three years, as also to meet the growing demand from emerging markets, says an Ernst & Young survey titled 'Turn risks and opportunities into results'.

"In many sectors, we are seeing a return to growth. While the past couple of years have been marked by intense cost-cutting, we are now seeing companies responding to competition by innovating, improving execution strategies and investing to improve operational agility and competitiveness," says Ernst & Young India leader for risk advisory services Ram Sarvepalli in the survey.

This is markedly different from how firms responded in the past to recessions, he says, adding, "The study confirms that, today, businesses look before they leap. They don't just seek opportunities, but focus on making sure they have the capabilities and innovative strengths to make a real impact in their chosen markets."

The survey was conducted between December 2010 and February 2011 among 733 companies spanning 15 countries--France, Germany, Italy, the Netherlands, Sweden, Britain, Poland, Russia, the Middle East, Africa, India, Brazil, the US, China, Australia, among the first and second level non-executive directors, and operational heads.

Apart from innovation and growth from EMs, the other top opportunities for the domestic companies are improving execution of strategy across businesses and investment in processes, tools, training, IT, and also in clean technologies, says the survey, which was made available exclusively to PTI today.