Society still puts the “gut instinct” on the pedestal, often celebrating people who lead by intuition and emotion, and putting them at the center of movies, TV shows and pop culture. That’s fine, at least as far as it goes.
And it might not go so far in payments and commerce in the coming decade, at least going by the results of a new Mastercard collaboration with Harvard Business Review Analytics on what really works when it comes to innovation, companies and executives.
The report, released Tuesday (Nov. 5), found that a solid majority of leaders in innovation draw insight toward the effort via multiple databases both internal and external — that compares to some 43 percent of executives marked as followers in innovation, and 11 percent considered laggards. When it comes to financial services, some 40 percent of those firms are the “furthest along” in the use of advanced data analysis to spark innovation — that makes financial services among the top industries when measured by the practice, behind pharmaceutical and medical companies, at 43 percent.
2020 Innovation Sparks
The report comes at a time when innovation — and data — are building a new world of digital payments and commerce. Indeed, as Karen Webster has written — and other experts have opined — the 2020s promise many marriages of innovations and new technology and processes created over the prior 10 years. Indeed, as Webster pointed out, the most transformative innovations in payments and commerce over the last decade are mostly the result of innovators making what was once visible, invisible: payments, stores, merchants, brands, issuers, even card networks.
So many things look likely to converge even more closely in the new decade — homes enabled for more commerce, connected cars and trucks, and that’s just for starters. And all that activity will certainly spark even more innovation, making a clearer picture of what works a pretty vital insight.
It’s not just data and data analysis that are crucial to innovation, according to the Mastercard report. A sense of adventure also matters. That’s not exactly a new finding, but it does serve as a reminder that even with the importance of data-driven moves, an old-fashioned sense of boldness still can do some heavy lifting when it comes to innovation. The report found that more than 40 percent of innovation leaders embraced what Mastercard called “moonshots,” which are defined as “ambitious, exploratory, groundbreaking projects.”
Even so, failure is a part of the process — just as artists and scientists have been telling people for centuries. The report found that 91 percent of innovation leaders view failure as generally acceptable, especially if they are so-called “fast failures.”
Keeping a good sense about what consumers want is also important, the report said. More specifically, 48 percent of consumers said continuous innovation stands as an important factor in motivating purchase. To put it more bluntly, it doesn’t seem that consumers want to be bored — a fact underscored by the rising trends of providing fuller-scale customer experiences, whether via mobile devices or even retail showrooms or social media.
What the Consumer Wants
Consumers also expect security — and you can certainly see that in the larger world of digital, as social media platforms and Google, among others, come under increased regulatory and political scrutiny. That said, the Mastercard report found that consumers are focused more on data security than realized by many executives, who tend to think consumers care more about cost savings, personalization and speedy deliveries. Consumers actually favored cost savings and data security more than those other factors.
Misunderstanding what makes consumers tick is only part of how a company can miss out on innovation. For instance, the report found that 54 percent of survey respondents said that “day-to-demands” serve to hinder innovations — that’s more than the 37 percent who said such hindrance comes from “sliced data/information across departments,” and 32 percent who blamed “legacy technology.”
No matter what, innovation comes so quickly that it can be hard to see it beforehand. And there is nothing to suggest that the pace will slow in the 2020s.
“Forget about three-or-five-year strategy plans,” said Mark Buitenhek, global head of transactions services for ING, in a quote used in the Mastercard report. “We think in quarters, we think in weeks. We think in sprints.”