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The innovation process in transition

The innovation process in transition

The effects of digitalisation on product innovation and development in manufacturing companies

  • Harald v. Heynitz

    KPMG AG Wirtschaftsprüfungsgesellschaft

  • Wolfgang Grassl

    KPMG AG Wirtschaftsprüfungsgesellschaft

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Industrial Manufacturing

A company's ability to innovate is a key success factor and an important way to ensure growth. Studies show that companies that engage in innovation management experience faster growth, generate higher revenue and are overall more successful. The conditions under which innovation and development processes take place have changed dramatically in recent years:

  • Product life cycles are becoming ever shorter;
  • Customer demand for individualised product variants is also experiencing a sharp increase;
  • Other countries, such as China, India and South Korea, are continually increasing their share of global R&D activities;
  • Site selection for R&D activities is becoming increasingly dependent on the availability of qualified staff;
  • When developing new innovations, the needs of both cutting-edge industrialised markets and developing markets must be taken into account;
  • Software is becoming the main driver of innovation. 

As a result, companies need to rethink their traditional innovation processes. Increasingly, companies are finding themselves unable to realise product innovations entirely on their own. Cooperation agreements and the establishment of networks of expertise can lead to highly promising joint developments.

All this requires an extensive restructuring of the innovation process in terms ofproduct life-cycle management (PLM). KPMG's white paper "A veritable assembly line of innovation" focuses on the first phase of PLM, the innovation process, and in particular on the product development process. 

Given that in the future companies in the manufacturing industry are set to become more strongly characterised by a continuous innovation process, it is important that they clearly define their innovation strategies with concrete innovation targets. Discover which factors are key to success in this area by reading through our case study "A new construction machine in a difficult market".

You can download our white paper here:

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