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Summary of the 2011 Best Companies for Leadership Study

In an uncertain and uneven global business environment, everyone agrees that companies must innovate to survive. The Best Companies for Leadership follow four business practices that support meaningful innovation and drive market leadership.

Leading companies have recognized that meaningful innovation requires a long-term commitment to a disciplined approach. They have focused their efforts on creating a culture of innovation: an environment throughout their organizations that invites and supports innovation and allows new ideas to flourish. The practices followed by the best companies enable and encourage innovation that matters – and any business can follow their lead and make innovation easier.

Enable organizational agility

With the accelerating pace of change, the window for meaningful innovation is narrower than ever. The best companies have flattened their organizations and streamlined governance, becoming more agile and reducing obstacles to innovation.

They focus on instilling agility in their leaders, and design job roles to allow flexibility in responding to immediate projects. They work quickly to translate strategies and decisions into action, and drive decision-making authority down the organizational structure.

Set the stage for innovation

The best companies provide a context to nourish and support meaningful innovation. They ensure that employees understand the organization’s business strategies, and encourage extensive discussion of future customer needs.

Moreover, they are almost twice as likely as other companies to support unprofitable projects in order to try new things – demonstrating a commitment to innovation and encouraging the extra effort and risks it entails.

Broaden perspectives

Different ways of thinking are essential to innovation. The best companies pursue multiple strategies to incorporate different perspectives in the workforce.

• They create room for new ideas, and look for them everywhere in their organizations.
• They value differences, and seek cultural, ethic and national diversity in their workforce.
• They engage the next generation, who value sustainability and bring their ideals to work.
• They deliberately seek to expand their employees’ capabilities and professional experiences.

Focus on collaboration

If different perspectives are the raw materials of innovation, collaboration is the process that brings them together. Accordingly, the best companies do not merely preach collaboration: they virtually require it.

They emphasize close collaboration among leaders in different parts of their organization, and take prompt action when leaders are not collaborating. Just as importantly, they reward collaboration, incorporating team-based measures in their incentive plans.

Leadership drives innovation

While responsive organizational structures are important contributors, effective, capable leadership is the single most important element in creating a culture of innovation. Leadership clarifies strategies and customer needs; elicits new insights from diverse, collaborative teams; and earns the focused effort and dedication that innovation requires.

In short, leadership creates a climate in which innovation is the expected norm, not the miraculous exception. Such an environment is an elusive goal, but the Best Companies for Leadership provide examples that every business can follow to encourage and support innovation.

Hay Group is a global consulting firm that works with leaders to turn strategies into reality. We develop talent, organize people to be more effective and motivate them to perform at their best. Our focus is on making change happen and helping people and organizations realize their potential. We have over 2600 employees working in 85 offices in 48 countries. Our clients are from the private, public and not-for-profit sectors, across every major industry.

For more information, call Alberto San Pedro in the Hay Group Vancouver office at 604.682.4814 or visit the Hay Group website at www.haygroup.com/ca