For the second consecutive year, Apple and Google topped the list of the 50 most innovative companies, according to the Boston Consulting Group.
The companies at the top of the list shifted just slightly from last year. Microsoft jumped up by one spot to take third place, while electric-car company Tesla fell from No. 3 to sixth place. Retail giant Amazon climbed from fifth place to fourth place, and Netflix, which made the top 10 in 2017, fell to No. 13.
In the most recent report, two new companies managed to push their way into the top 10: ride-hailing app Uber and e-commerce site Alibaba.
Geographically, North America produced the most innovative companies, with 27 featured on the list. Europe produced 16 entrants, up from 10 last year.
The travel and transportation sector also expanded its showing on the 2018 list, with companies such as Uber, Tesla, SpaceX and Airbnb included.
The firm found that the most innovative companies have been fueled by digital technologies. For example, they prioritize mobile products, digital design, big data and also quickly adapt to technological advances. They also tend to develop and test new products faster and more cheaply than other companies.
According to the research, the biggest difference between the most innovative companies and the companies that appear much lower on the list is how heavily they have incorporated these digital processes into their businesses.
"While 79 percent of strong innovators reported that they had properly digitized innovation processes, only 29 percent of weak innovators make the same claim," the study reports.
Last year, the most innovative companies were those that brought in new ideas from outside sources such as social media and had open and collaborative work environments.
Finally, the research notes that business leaders at the most innovative companies do five key things that set them apart from their competition:
1. Leaders dedicate resources: They realize the importance of digital and invest accordingly.
2. Leaders invest in speed: They test ideas earlier and launch products quickly.
3. Leaders take smart risks: They make big bets that are high-risk but also high-reward.
4. Leaders invest in data: They mine and analyze data to glean insight for their products.
5. Leaders secure top talent: They acquire and develop talent across the company.
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