Research from Boston Consulting Group finds that 84% of firms in the region are starting to use generative AI to drive innovation and address obstacles.
By Maggie Mancini
Companies in the Gulf Cooperation Council prioritise innovation more than ever, with 85% of senior executives in the region ranking it among their organisations’ top priorities, slightly above the global average. This strong commitment to innovation reflects the region’s ambition to lead the global knowledge economy. A new report released by Boston Consulting Group highlights this positive trend while noting opportunities for GCC firms to enhance their innovation readiness.
For its annual innovation study, BCG assessed companies’ innovation maturity and surveyed senior innovation executives worldwide, including those in the GCC region.
While innovation continues to demonstrate value, the study shows that innovation systems globally need a reboot. Innovation priority remains at an all-time high, with 83% of global companies ranking it as very important. However, innovation readiness has sharply declined worldwide, from 20% two years ago to 9% last year and just 3% this year globally.
This global trend is even more pronounced in the GCC, where firms exhibit even lower innovation readiness than the global average. The study reveals that while GCC organisations prioritise innovation at a higher level than their global counterparts, they face greater challenges in translating that ambition into readiness. This aligns with global patterns where companies across various regions are struggling to match their innovation priorities with practical readiness, though the gap appears more significant in the GCC.
“We are seeing GCC organisations prioritise innovation, with 85% of executives ranking it highly. However, converting this ambition into readiness remains a challenge,” says Faisal Hamady, managing director and partner at BCG. “To close this gap, it is crucial to strengthen the link between innovation and business strategy. Organisations must benchmark processes, align them with strategic goals, and leverage generative AI while addressing talent constraints and rising capital costs.”
The study finds that 84% of GCC firms are starting to use generative AI to drive innovation, reflecting the region’s embrace of cutting-edge technology. However, as with global trends, most organisations are still in the early stages of GenAI adoption.
The study recommends that business leaders consider these key elements to improve innovation readiness and link innovation with business strategy:
- ensure innovation is championed by C-suite leaders;
- develop a clear sense of purpose for innovation and how it supports company strategy;
- focus on opportunities where the organisation has a competitive advantage;
- focus the innovation portfolio on areas that support the overall strategy;
- create a vision for how resources should be deployed across that innovation portfolio; and
- establish a fact-based perspective on how innovation contributes to financial goals.
