NEW YORK: Introducing a "major product innovation" was the most-commonly adopted strategy by companies in the last financial year that was not tied solely to the downturn or the activity of their competitors, a global survey from McKinsey has found.
Based on a poll of 1,552 executives working across the "full range of industries, regions, and functional specialties," the company reports that some 31% of participants launched such an initiative over the 12 months ending in March this year.
This compared with 22% of respondents who argued that their single biggest project involved moving an existing product into a new sector, while 15% pursued mergers and acquisitions, and just 6% focused on "price restructuring".
Some 62% of those surveyed agreed these approaches constituted either the "next logical step" or an "increased investment in an existing initiative," compared with 15% adopting "a completely new strategy".
When extended to the last five years, 61% of executives argued their most important strategic plans followed on from pre-existing arrangements, while 85% said these schemes were undertaken "in addition to" their existing goals.
Just 4% of firms effectively "reversed direction", while 34% went in a "new direction" altogether.
In terms of the motivation behind these five-year plans, 41% of McKinsey's panel argued they had "responded to an opportunity," while 27% said they "responded to a challenge".
When asked to define the exact nature of the "opportunity," 17% cited a "new idea from existing management," while 15% reacted to "new information about the business or marketing environment".
A further 14% said their strategies were based on "internally developed innovation," a role 13% attributed to a "major shift in a global trend affecting our industry".
Similarly, 30% of respondents identified the core "challenge" as resulting from such a shift, with 26% saying it originated from management, and 20% basing it on new data about the business and marketing environment.
In terms of implementing a new strategic approach, McKinsey found that just 23% of firms "introduced it to the market without warning," taking an average of 13 months to fully execute their overall plan.
Data sourced from McKinsey; additional content by WARC staff