Innovation, with a focus on digital, is becoming among key priorities for businesses in Saudi Arabia. The rise of the startup culture, the concern against ‘Digital Darwinism’ and the likes are seeing companies in the Kingdom gear up for growth on the back of newer technologies. In this background, GE’s 2016 Global Innovation Barometer reiterates how Saudi Arabia is changing for a digital future.
“The GE Global Innovation Barometer findings from Saudi Arabia underline the deep interest among the Saudi business community to invest in talent and innovative technologies to drive a new era of growth. This reflects the goals of Saudi Vision 2030, which aim not only to diversify the economy, but also to drive progress and transformational growth. Innovation is at the heart of the new development narrative of the Kingdom, and we are committed to nurturing it through our people, strategic investments, partnerships and localization initiatives,” said Hisham Al-Bahkali, GE’s President & CEO for Saudi Arabia and Bahrain.
Nidal Ghizawi, Director of the Saudi GE Technology & Innovation Center added, “Our investment in the Saudi GE Technology & Innovation Center in Dhahran Techno Valley is a compelling testament to our focus on promoting localized research and development. By working with the Saudi research community, our industry partners, and the GE Global Research Centers around the world, we are supporting the development of a new innovation ecosystem in the Kingdom that will help meet the requirements of our partners and the community, especially in digital, energy and healthcare. With several patents to our credit already, the path-breaking research we undertake contributes to improved productivity levels in the Kingdom and has practical applications globally.”
Clear Innovation Strategy
The GE Global Innovation Barometer 2016 shows that Saudi Arabia is ready to build a new innovation ecosystem, with 69 percent of Saudi executives stating their organizations have a clear innovation strategy. They show a preference for innovating incrementally and a larger proportion of businesses in the Kingdom favor external innovation than their peers globally.
Nearly 79 percent of Saudi executives agree that innovation has netted positive results, stating they have seen growth in revenue and profit generated by collaborative innovation activities. 67 percent are willing to share the revenue stream (or losses) that could be generated through collaborative innovation. Highlighting their openness to leveraging big data, 73 percent of Saudi executives report an expansion of the ability of their businesses to analyze large and complex amounts of data, compared to only 48% in the previous 2014 survey.
Overcoming Challenges
Saudi executives see a reduction in the difficulty to come up with innovative ideas – 49 percent now, compared to 65 percent in 2014. Around 58 percent say they are most challenged by the lack of sufficient investment and financial support for innovation. Nearly half the respondents feel that rewarding those in the organizations who create innovation and encouraging innovative people are key best practices to foster radical innovation. 57 percent say talent challenge remains, with 52 percent of executives looking for candidates with strong problem-solving skills, and 48 percent with strong creativity.
Positive Effect Of Digital Revolution
An overwhelming 81 percent of the informed public surveyed said that in the next 10 years, technological developments such as robotics and automation will radically transform the job market and nature of work. 84 percent said the most innovative companies will not only launch new products and services but also create new markets that previously didn’t exist. Some 41 percent of the business executives and 49 percent of the informed public feel that the digital revolution will have a positive impact on employment. Over one-third also said that it will lead to the creation of new jobs.
The Future Worker
Across the globe, the survey finds that the future worker is changing with the rise of ‘nomad employees’ – people who favor freelancing and contracting modes. In the Kingdom, 68 percent of the business executives – compared to 81 percent globally – say a startup ethos is increasingly becoming the norm for creating an innovation culture within companies of all sizes. More than the global average, 66 percent of the informed public and 62 percent of business executives said the current education system is adapted to fulfil the private sector’s demand for new talent and skills. Nearly two-thirds also said the current education system is preparing the next generation for the jobs of tomorrow.
A Digital Future
Several questions in the latest survey discussed the importance of digital technologies. Nearly 70 percent of business executives and 80 percent of the informed public shared their concern about the impact of the fast-paced growth of digital technology on businesses, stating they are mindful that more businesses face the challenge of ‘Digital Darwinism’ – the risk of becoming obsolete if they fail to adapt to and embrace technological changes. Similar to the global average, 58 percent of the respondents said maximizing the performance of revenue streams and business models is important compared to opening up new business models.
The findings of the GE Global Innovation Barometer highlight the clear focus of businesses on developing a culture of innovation in preparation for a digital industrial future. GE is supporting the country’s innovation landscape through its various investments including in the Saudi GE Innovation & Technology Center, which has already achieved breakthrough results with several patents for localized research.
The GE Manufacturing Technology Center (GEMTEC) in Dammam will also serve as one of GE’s global centers of excellence in innovation, especially in Hot & Harsh research. In 2015, GE announced USD 100 million in new programs to strengthen the Company’s localization efforts, build research and innovation capacity, and create jobs in advanced manufacturing and software analytics.
Now in its fifth year, the research surveyed 2,748 senior business executives and 1,346 informed publics across 23 countries. In Saudi Arabia, the survey covered about 200 C-level business executives and informed citizens, just as the Kingdom embarks on a new era of growth underlined by the Saudi Vision 2030.
