The global innovation management market size was valued at USD 1.5 billion in 2021. It is projected to reach an expected value of USD 6.2 billion by 2030, growing at a CAGR of 16.4% during the forecast period (2022–2030). The word "innovation management" describes the process of a company's innovation, from idea generation to practical execution. Formulating options, using a creative approach, and processes and methods are all part of the operation. The technology aids in the creation of creative business models as well as new products, services, and skills. These innovative management efforts usually use a disruptive change technique to revolutionize businesses.
Due to innovation management, managers and executives or clients can interact with a precise grasp of processes and goals. Among the significant factors boosting the growth of the innovation management market is the changing working environment in businesses worldwide. Furthermore, regulatory restrictions, rising urbanization and digitization, IoT use, and the desire to apply new technologies to ensure workplace sustainability benefit the innovation management industry.
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Open innovation is the transfer of ideas and knowledge among stakeholders like business associates, enterprise workers, the public in general, and consumers to improve products, solutions, and business operations for a better user experience and increased income. Crowdsourcing innovation is similar to open innovation. It starts with recommendations for product and service improvements and continues to open business model development. It creates a strong bond between stakeholders like companies, employees, and customers. Based on sharing ideas, enterprise management teams can forecast concepts that will increase sales and enhance the customer experience.
Improving brand consistency would also assist the business in maintaining its competitiveness in the market. The ideas generated by crowdsourcing can either help firms improve their operational efficiency or enable them to explore new business potential. Companies worldwide are turning to crowdsourcing for innovation, recognizing the potential and intelligence of their employees, partners, and customers. Due to intense market competition, businesses compete for the first-mover benefit, driving an increased desire for open innovation and crowdsourcing. As a consequence, the worldwide innovation management market is expected to grow.
Businesses are obtaining competitive advantages through innovation as the level of competition rises. Companies use innovation to set themselves apart from the competition and reach out to a new customer segment. The bulk of the industry is shifting its focus to innovations due to the necessity for a shift in company strategy from present operations to future potential. During 2015–2019, Research and Development activity for product development spiked by almost 20%. In 2018, 55% of businesses worldwide reported favorable outcomes due to product innovation. As innovation drives grow, companies hold more roundtable discussions and draft many ideas. As a result, effective handling of ideas/innovations on a shared platform is achieved, resulting in a more attractive market for innovation management.
Innovation management systems can enable businesses to enhance their business operations. However, there is a lack of quantifiable metrics for determining the return on investment (ROI) using these innovative business tools and services. Consequently, businesses that implement innovation management solutions cannot deliver consistent returns on investment. Innovation management systems must be combined with strategies to determine key performance indicators (KPIs) that may be used to analyze stakeholder involvement in innovations.
To track and assign business value generated by innovations, companies must examine the appropriate KPIs by top-level management. They should be conscious of the added value of implementing specific ideas in their businesses. Furthermore, if enterprise decision-makers cannot link ideas to commercial success, the innovation management platforms will add no value to the company's existing procedures. Therefore, the inability of businesses to track a consistent return on investment from innovation management systems acts as a barrier to the market's growth.
Within the last few years, every firm has undergone a digital transformation. The increasing development of advanced technologies has led to the generation of a massive volume of information, necessitating improved data retrieval and processing speed. Systems for managing innovation have grown almost in lockstep with technological improvement. Enterprises make critical decisions depending on the ideas generated from multiple innovation management solutions. Ideas were initially gathered through questionnaires, feedback boxes, or comments; however, with innovation management systems, businesses have discovered that fresh ideas increase productivity, improve profitability, and may be used to make better strategic decisions. The increasing requirement to examine relevant ideas from various sources has prompted the need to extract solutions from raw data to make vital judgments.
The global innovation management market share is segmented by type, deployment, function, organization size, vertical, and region.
Based on type, the global innovation management market is segmented into Software and Services.
The Services segment is expected to contribute considerably to the growth of the innovation management market during the forecast period. The three categories of innovation management services are consulting, system integration, training, support, and maintenance. Business consulting, business discovery, and business value consulting are examples of pre-deployment requirements of companies that are covered by innovation management consulting services. These consulting services assist businesses in using new technologies to upgrade their present and traditional infrastructure into intelligent infrastructure.
The necessity for supporting services is expanding with the increased usage of innovation management solutions throughout significant verticals. Services are critical in assisting businesses in fully utilizing innovation management systems. End-users, including influential organizations and SMEs, benefit from the system integration services supplied by innovation management solution providers. These services install and merge innovation management solutions with current IT infrastructure systems in a timely and efficient manner. They also help integrate critical software to put together disparate systems of devices that are nonetheless effectively connected to IT infrastructures. Hence, such factors drive the market's growth.
Based on function, the global innovation management market is segmented into Product Development and Business Processes.
The Business Processes function is expected to contribute significantly to the innovation management market during the projected period. The idea platform encourages open business models and fosters strong relationships between businesses, their workforce, collaborators, and customers. The generation of ideas through innovation management systems for corporate operations would increase overall business productivity, assisting organizations in increasing revenue. All concepts created and processed in response to consumer needs are converted into products with an innovation management solution. Moderators can anticipate product ideas that will deliver the best returns to businesses depending on the ideas generated. Thus, the factors mentioned above drive the market growth.
Based on deployment, the global innovation management market is segmented into Cloud and On-premise.
The Cloud deployment mode is expected to grow swiftly during the projected period. Cloud-based innovation management solutions are critical because they provide an adaptable and resilient infrastructure for managing various devices and analyzing ideas from employees, consumers, and partners. Though cloud deployment makes it easier to incorporate innovation management solutions, it also comes with several significant challenges, including regulatory requirements, stability and security, performance, predictability, transition sophistication, operational management, content governance, and, most importantly, the promised Return on Investment (RoI) benefits.
Based on organization size, the global innovation management market is segmented into Large Enterprises and Small and Medium-Sized Enterprises.
Large Enterprises are expected to contribute significantly to the growth of the innovation management market during the projected period. The organization's size greatly influences the development of innovation management solutions worldwide; thus, studying the market about organizational size is vital. Large companies are more likely to use innovation management solutions than SMEs, propelling the market's growth.
Based on vertical, the global innovation management market is segmented into BFSI, Healthcare, Education, Media & Entertainment, IT & Telecommunication, Retail, and Government.
The Healthcare and Pharmaceutical industry is expected to hold the highest market share during the projected period. Through the use of innovation management systems, the healthcare and pharmaceuticals verticals are constantly evolving. In response to fluctuations in consumer/patient demand and digitalization, the vertical's landscape has shifted dramatically in recent years. Healthcare and pharmaceutical companies are rethinking their strategies to meet the requirements and standards of patients and consumers worldwide. In the healthcare and pharmaceutical industries, adopting innovation management systems enhances patient care and optimizes numerous medical operations, boosting market expansion.
The IT & Telecommunication industry is the fastest-growing segment. It has a significant impact on the innovation management market's expansion. The vertical is quickly expanding and is now regarded as one of the most important in the innovation management market. The growing demand for creative, customized, and creative ideas is likely to propel the IT and telecommunications vertical forward, as fresh, customized, and innovative ideas have prompted enterprises in this vertical from all countries to engage in activities both inside and beyond the vertical.
Based on region, the Global Innovation Management Market share is segmented into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.
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North America has emerged as the largest market for the global innovation management market. Regarding adopting innovation management systems across industries like healthcare, IT, aerospace, and manufacturing, North America has been a very open and competitive industry. It is the region that adopts innovation management strategies the fastest. It has been quite receptive to incorporating recent technology developments, like integrating mobile, cloud, and AI technologies with conventional innovation management tools.
Furthermore, the growing need to manage greater operational efficiency and business processes at a low cost is propelling R&D efforts in this region, resulting in a new potential for innovation management software. The rigorous government standards and regulations framed for various industries also contribute to market growth. The failure to comply may result in fines and other severe penalties. Another driving factor is the demand for improved operational efficiency that helps organizations archive legacy data and keep only recent and required data in the secondary storage.