An emphasis on new products
Over the next two years those planning to rely on existing products in existing markets will more than halve (from 44 percent to 19 percent), whereas those planning to sell new wares in existing and new markets will increase from 37 percent to 56 percent, putting a premium on innovation.
Which of the following is the primary focus area of your growth strategy
for the coming 12 to 24 months, and the past 12 to 24 months?
Investing in innovation
A second growth theme is a greater focus on product diversification and innovation. This is a significant shift from recent years. Existing products will be significantly less important in existing markets, while much greater emphasis is placed on new wares – in both existing, and new, markets. While cost management remains the top priority, innovation and R&D come in second. This will be a particular priority for US firms, which rank R&D and innovation on a par with cost management.
Which of the following aspects of your business will you seek to
invest more and/or expand in the coming 12 to 24 months?
Strategic acquisitions and alliances
Companies plan to grow both by increasing production capacity (chosen by 36 percent of respondents overall) and via mergers and acquisitions (M&As), joint ventures (JVs), and strategic alliances (39 percent). This is not surprising given that companies are cash-rich after the last few years of stringent cost saving measures.
Noteworthy from a regional perspective is that European respondents are overwhelmingly in favor of M&As, JVs or strategic alliances (57 percent), while respondents from Asia-Pacific and North America slightly favor a more inward approach, namely increasing production capacity.
Primary Approach for Achieving New Growth