What is an Innovation Strategy and why do many organizations lack one?

Are you interested in reading more about innovation? Read also how RevelX integrates AI into innovation strategy development and the most important questions stakeholders ask about innovation strategy (FAQ).

In an era of disruptive technologies, social transformation, and economic uncertainty, innovation is not a luxury. It is a necessity. Yet, RevelX research among almost 1000 companies shows that 60% do not have a clear innovation plan. And that is problematic. Because without direction, innovation becomes ad hoc, random, and rarely effective.

An innovation strategy is the plan that outlines how innovation contributes to the long-term relevance and success of an organization. It defines:

• What you innovate on (innovation ambitions and themes)
• Why you innovate (drivers of disruption)
• How you innovate (roadmap, capabilities, partnerships)

A strong strategy ensures that innovation is not separate from your business strategy, but complements and reinforces it.

From our benchmark data:

• 52% of companies have no clear view of future disruptions
• 61% underinvest in long-term innovation initiatives
• 60% lack a well-defined innovation strategy

The root causes:

• Short-term focus: Quarterly targets dominate at the expense of long-term vision
• Tunnel vision: Too internally focused, too few external signals
• Lack of ownership: Innovation is not embedded in leadership responsibilities

RevelX developed the Innovation Strategy Canvas, a framework based on hundreds of innovation programs. It consists of these six components:

1. Drivers of disruption – What major trends, technologies, and customer needs could reshape your industry?
2. Innovation readiness – How mature is your organization in terms of innovation culture, processes, and leadership?
3. Innovation ambition & themes – What is your BHAG? Which innovation domains best support it?
4. Innovation roadmap – Which concrete projects will you pursue across the three innovation horizons?
5. Innovation enablers – Think governance, skills, tooling, and innovation structure.
6. Innovation North Star & targets – What are your measurable innovation goals? Where are you heading?

To build an innovation strategy that will actually become embedded in your organization, start with the right mindset. Forget 100-slide decks and abstract mission statements – a good innovation strategy is pragmatic, focused, and actionable. It should:

• Align with your long-term strategic ambition
• Reflect external disruption and future customer needs
• Define how innovation will create future value

At RevelX, we help organizations build it in 6 practical steps, aligned with the components of the Innovation Strategy Canvas:

Before setting ambitious goals, assess where you stand. Our Innovation Readiness Benchmark covers 7 key areas:

• Leadership and ownership
• Portfolio management
• Innovation competences
• Organizational structure
• Innovation culture
• Governance & decision making
• Process & tooling

This helps identify strengths, blind spots, and key enablers to develop.

Your innovation ambition should go beyond “better products.” It must reflect:

• Your North Star: what future role will your company play?
• Your BHAG (Big Hairy Audacious Goal): a bold, inspiring ambition
• Your themes: key areas of focus (e.g. AI, Servitization, Circularity)

This sharpens strategic focus and drives ideation.

Your roadmap translates ambition into execution. Start by:

• Mapping current innovation initiatives
• Identifying gaps (e.g. missing themes, lack of Horizon 2 or 3 projects)
• Prioritizing based on business impact and strategic fit

Use criteria and metrics to kill hobby horses and double down on high-potential projects.

Strategy without capability is wishful thinking. Define initiatives to strengthen your innovation power:

• Who owns innovation?
• Do teams have the right skills?
• Is governance fast and data-driven?
• Are there tools to track, decide and scale?

Each of these enablers deserves focus to make innovation stick.

To align your teams and get buy-in across the business, summarize your entire strategy in one page using the Innovation Strategy Canvas. This helps:

• Communicate clearly across levels
• Keep focus in execution
• Review and iterate quarterly

You can download the canvas template via our website.

Companies with a defined strategy for innovation:

• Respond more quickly to disruption
• Have a more balanced innovation funnel
• Embed innovation as core business

Our research shows that 76% of high-performing companies do have a clearly defined innovation strategy.

Building an innovation strategy is not about writing a document—it’s about setting direction, creating ownership, and enabling execution. The tools are here. The urgency is real. The rest is up to you.