IBM released the Global CEO Study 2006 (thanks for the Business Innovation Insider for pointing me there). The report summarizes the view of over 760 CEOs around the world regarding innovation within the corporate environment.
There are many interesting issues being explored, even if not all of them are necessarily novelties. The report mentions for example, confirming what we have already discussed here, that according to CEOs the main obstacle to innovation is the corporate culture.
It also mentions how Google is managing to build a very innovative culture by fostering employees’ networks. Google has a very flat organization, with a line employees to managers ratio of 20:1 compared to the industry average of 7:1. The result is that individuals have more freedom to engage peers with ideas and ad-hoc projects, and when such projects become commercial the company recognizes the efforts, both formally and financially. I think this is a very important point because it reduces the incentives talents would have to take their ideas outside Google, maybe creating some start-up.
Another topic that got my attention was the increased focus on business model innovation. Over the last decade companies and managers have paid too much attention to product innovation, no wonder most people associate the word innovation with uber-technological devices. The IBM report outlines that business model innovation is becoming the new differentiator and that companies investing in such type of innovation managed to increase the operating margins significantly.
Finally, reading the report I came across a nice quote from Rupert Murdoch, Chairman and CEO of the Newscorp Corporation:
“The world is changing very fast, big will not beat small any more. It will be the fast beating the slow”.