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Merchants everywhere are faced with significant number of changes. Be it the way their customers want to make payment or discover them, the way customer chooses the nature of goods and services to buy or in the form of new entrants and converging value chains.

In response to this, almost all large merchants are transforming their strategies and distribution models. Strategic decisions being taken today have the potential to reshape the competitive landscape, and the approach that merchants take for innovation will have a significant bearing on their future success. While technology is, and will remain, an important part of the answer, it is people who truly change organizations. The merchants that ally cultural change with technology leadership to drive innovation place themselves in the best position to thrive.


The Culture of Innovation Index is built upon a global program of research spanning players from across today’s payments ecosystem. The culture of innovation index aims at one thing: to identify not only the factors that separate the most innovative businesses from the laggards, but also what this means in terms of product innovation. We seek to understand – with the culture if innovation, how the most innovative organizations will convert their investments into future gains.

So far in 2019, Switzerland ranked No 1 as the most innovation country followed by Sweden.


There are five types of organization the culture of Innovation Index identifies as defined by their approach to innovation and business transformation.

1) THE EMERGING ORANIZATIONS: This type of organization has a strong cultural and structural emphasis on innovation, they have clearly articulated technology strategies and they focus on business transformation.

2) THE LAGGARDS: This type of organization is behind the curve in both culture and technology, often with a preference for outsourcing services, generally aware of the challenges they face but not actively responding to them, and they are falling behind the market when it comes to innovation in the customer experience.

3) THE TRAILBLAIZERS: These organizations are digital-led or strongly digital organizations, they have their businesses structured around driving innovation, and they are Leaders in adoption of technology and delivering new products/services.

4) THE ADVANCED ORGANIZATIONS: These organizations have a strong focus on the importance of ensuring innovation is an enterprise-wide activity, clear strategy and roadmaps around technology adoption and product innovation, among the leaders in product development.

5) THE TECH-LED ORGANIZATIONS: These organizations are weak when it comes to an enterprise-wide approach to innovation, strong focus on investing in technology, but rarely a market leader in product innovation Ideas and technology strategy tend to be centrally driven.


Everywhere, merchants are challenged by pressure from new entrants, the breakdown of traditional industry boundaries, and growing customer preference for a digital-led or digital-influenced purchasing experience. This creates both the need for change and the opportunity to future-proof through organizational transformation.


While there is no single formula for driving innovation within an organization, there are some emerging indicators of best practice. For merchants, there are seven characteristics of the Trailblazer Group – the most innovative enterprises – that stand out from the rest of the market.

A STRONG CENTRAL FUNCTION TASKED WITH DRIVING INNOVATION: The presence of central innovation and/or digital teams with the resourcing, responsibility, and senior sponsorship to coordinate and support innovation is becoming increasingly important to any large organization.

AN AGILE CULTURE THAT IS RESPONSIVE TO CUSTOMER NEEDS: One of the most important differentiators for the most innovative merchants is the ability to respond quickly to changing customer needs. This is partly a question of technology and IT organizational structure but also of an open and collaborative culture.

A COMPANY-WIDE ENGAGEMENT WITH EMERGING TECHNOLOGIES: The most innovative merchants invest resources in exploring and experimenting with new technologies to identify opportunities to enhance products and services.

FOCUS ON BRINGING INNOVATIVE PRODUCTS AND SERVICES TO MARKET IS A HIGH PRIORITY: The degree to which delivering new products and services is seen as an important company focus, be that through external messaging and investment in these areas or through softer measures such as internal promotion.

EMPLOYEES ARE TRAINED TO SUPPORT NEW PRODUCT/SERVICE DEVELOPMENT: Highly innovative merchants place particular emphasis on giving employees the opportunity to be trained and involved in the process of identifying product/service gaps as well as enabling them to actively engage in the process.

AN IT FUNCTION CAPABLE OF DELIVERING INNOVATION: Innovative organizations have stated plans (internal and external) around the use of cloud technologies including the use of cloud for mission-critical workloads.

INVESTMENT IN THE CUSTOMER EXPERIENCE: The merchant’s budgets for investing in “change the company” priorities are targeted to drive improvements in the customer experience.

If you want to dive deeper into this subject please also read our booklet by our corporation partner OVUM “Digital Transformation and the Drive for Merchant Innovation” or step into the world of “BIG Picture”. “BIG Picture” is our well proven Innovation Process, developed by Prof. Lercher in Graz, how to implement and continues circle of innovations within your company.

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