These companies are best in class in terms of speed of new product development.

What are the characteristics of companies that use Generative AI to outpace their competition?

Top innovators invest significantly more in R&D and digital technology, with a focus on tech that enables strategic differentiation:

✓ They spend, on average, 55% more on digital technologies compared to the average company.
✓ Top innovators focus on speed, granularity, and integration, reporting two to three times higher capabilities in these areas than the average company.
✓ They invest differently in digital technologies and get much higher returns on those investments.
✓ These companies were ahead in deploying technologies like the Internet of Things and design engineering before others.
✓ Companies with innovation cultures are well ahead in deploying generative AI at scale to accelerate R&D and innovation processes.
✓ They continually build proprietary data to feed Generative AI (gen AI) models and get valuable insights.
✓ Top innovators excel at asking good questions to gen AI, weeding out bad answers, and continually building proprietary data.
✓ They have workflows prewired for no human touch, making processes more efficient and seamless.
✓ These companies have cross-functional teams to avoid pitfalls like generating hallucinated data and are connected to control functions to mitigate risks.
✓ Top innovators are agile organization-wide, allowing them to act quickly on insights generated by gen AI.
✓ These companies have executive leadership teams with a higher percentage of tech-savvy leaders.

✓ They have a quantifiable aspiration for what they want to achieve through innovation and allocate resources rigorously.

✓ Top innovators celebrate noble failures and are fearless in learning from them.
✓ These organizations have a dynamic and integrated resource allocation approach similar to venture capital firms.

Business leaders must help set the direction for deploying gen AI where it can bring the biggest strategic advantage.

With specific reference to Generative AI in Innovation:

✓ Generative AI (GenAI) contributes to idea generation and validation, helping organizations question their strategic assumptions.
✓ Applying GenAI to innovation can lead to organizations generating five times more ideas compared to those not benefiting from the technology.
✓ GenAI helps identify, prioritize, and invest in the best ideas for new products, services, processes, or business models.
✓ Innovation thrives on doubt, and GenAI can provide an outsider's perspective free of human biases to challenge existing assumptions.
✓ GenAI can help in unpacking and creating new strategic assumptions, leading to transformational thinking and defining a new box for innovation.
✓ During the divergence phase of the ideation cycle, GenAI can generate a variety of ideas within the new or modified box, enhancing the innovation funnel.
✓ Organizations incorporating AI into their innovation systems generate significantly more ideas compared to those not using AI.
✓ GenAI can help in refining concepts, evaluating their desirability, viability, and feasibility, and challenging ideas as a devil's advocate.

Human insight remains essential in the innovation process, with GenAI serving as a fast and smart intern to enhance creativity by identifying and challenging old assumptions.