INNOVATIVE companies are distinguished from their peers by having the right people in the right environment with the right leadership, according to an analysis of Fortune’s list of most admired companies
INNOVATIVE companies are distinguished from their peers by having the right people in the right environment with the right leadership, according to an analysis of Fortune’s list of most admired companies.
Conducted by Hay Group in partnership with Fortune, the analysis found a number of characteristics among employees at the most innovative companies.
Such employees were high achievers, intellectually curious, and risk takers. They also evidenced a high tolerance for ambiguity in their jobs and a high level of empathy and sensitivity to others, the research found.
In terms of environment, 10 factors distinguished the world’s leading innovative companies: vision; tone; talented employees; disciplined managers; a nurturing environment; patience; a tolerance for failure; investment in research and development; as well as the right structures, processes, and systems for innovation to flourish.
Leadership also played a crucial role in innovation, whereby executives surround themselves with people who are not afraid to challenge them on their thinking.
“Innovation starts at the top with the CEO and senior executives setting the tone and vision for the company,” said Hay Group’s vice president Mel Stark.
“You can generate innovation within a company if you are willing to create the organisational conditions that allow it to flourish. It starts with screening for the right people that will fit into the corporate culture, hiring and retaining them, and developing systems to manage them.”
The survey of executives at 160 companies found that innovative companies tend to define standards for their industry sector.
Managers within the innovative companies are given the decision-making latitude they need (91 per cent, versus 82 percent of peer companies) and their companies are patient with ideas that don’t generate immediate results (75 percent, versus 62 per cent of peer companies).
The research found that innovative companies are patient with ideas that don’t generate immediate returns and don’t withdraw funding or support too quickly. However, these same companies are not afraid to admit mistakes and cut their losses on ideas that fail.
