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Innovation as a growth driver according to the Q3 2016 Middle Market Indicator

Employees + market smarts drive innovation

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Page 1: Employees + market smarts drive innovation

Innovation as a growth driveraccording to the Q3 2016 Middle Market Indicator

Page 2: Employees + market smarts drive innovation

Innovation drives middle-market growth

25% of

middle-market

firms

They count on newly introduced products for 20%

of their revenue.

New-product revenue is expected to increase 32%

in the coming year.

2© Grant Thornton LLP. All rights reserved.

Page 3: Employees + market smarts drive innovation

What kinds of innovation will have the biggest impact on performance?

Improvements to

products or services

32% 21%Development of new

processes to improve

profitability

20%Development of new

products or services

3© Grant Thornton LLP. All rights reserved.

Page 4: Employees + market smarts drive innovation

Innovation depends on talent + market smartsLeaders say they’re equally key.

Hiring and

keeping talent

60%

In-depth

understanding of

market conditions

59%

45% said creation of an environment and culture are conducive to innovation.

Learn more about

employment

growth.

4© Grant Thornton LLP. All rights reserved.

Page 5: Employees + market smarts drive innovation

How do firms

plan to innovate

in the next 12

months?

39% continue to hire new talent

36% invest in R&D

19% look to acquisitions

Hiring new talent is the top choice for innovation

Watch. Key insights on balancing revenue + employment growth.

5© Grant Thornton LLP. All rights reserved.

Page 6: Employees + market smarts drive innovation

42% Only 42% of leaders say their companies are excellent or

very good at driving innovation.

They give better rankings to other core competencies.

What’s the problem with innovation?Despite its importance, many leaders rate their companies only moderately

well at innovating

6© Grant Thornton LLP. All rights reserved.

Page 7: Employees + market smarts drive innovation

© Grant Thornton LLP. All rights reserved. 7

So what’s next?

Page 8: Employees + market smarts drive innovation

© Grant Thornton LLP. All rights reserved. 8

Innovation is expected to follow the hiring jump

Video: High-growth businesses: Balance revenue + hiring

Innovative talent is critical to driving innovation.

But don't go overboard — to sustain growth, balance investments in new talent

with those in revenue.

Check out resources for middle-market, high-growth companies

Balancing revenue + hiring

Page 9: Employees + market smarts drive innovation

© Grant Thornton LLP. All rights reserved. 8

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