"Mastering Innovation" is the third report from Deloitte's Global Benchmark Study program. The latest findings, based on research from an initial group of 650 leading manufacturers worldwide, reveal that:

• Manufacturers cite launching new products and services as the No. 1 driver of revenue growth, yet also view supporting product innovation as one of the least important priorities;
• 50 to 70 percent of all new product introductions fail;
• New product revenue will jump to 35 percent in 2006, up from just 21 percent in 1998;
• By 2010, products representing more than 70 percent of today's sales will be obsolete due to changing customer demands and competitive offerings.

The research findings conclude that many manufacturers are unable to profitably bring new products and services to market.  This paradox is the result of several key reasons, including:

• Insufficient information on customer needs;
• Supplier capabilities;
• A reluctance to allocate additional spending on research and development;
• A disjointed approach to innovation across product, customer and supply chain operations.

"Mastering Innovation" reveals best practices for driving profitable growth through effective new product lifecycle management. A small percentage of manufacturers that have achieved success excel in three areas, including mastering innovation, exploiting innovation and building innovation capabilities.

Read an executive summary or the entire report, available as PDF file attachments in the links below. Or view the rest of the Global Benchmark Study materials and learn more about our Global Manufacturing Industry practice.