5 ways innovative leaders stay on top
Forbes recently published an item called How Innovative Leaders Maintain Their Edge. The piece was written to complement the publication’s study of the world’s most innovative companies. The authors of the article tackled the question, “Why are some companies able to create and sustain a high innovation premium while others don’t?”
Companies that create and sustain innovation have three priorities: they focus on people, processes and philosophies.
Behaviour of innovative leaders includes five key discovery skills:
Question the status quo
Observe and find new ways of doing things
Network with people who work differently to gain fresh perspective
Those behaviours trigger new thought processes to “connect the unconnected”.
CEOs of innovative companies scored in the 88th percentile of these discovery skills sets. CEOs of average companies scored in the 62nd percentile.
Case study: Fabrizio Freda
Fabrizio Freda is the CEO of Estee Lauder. Early in his career, he moved from Procter & Gamble to Gucci and then back to Procter & Gamble.
He says time spent outside Procter & Gamble allowed him to gain a fresh perspective on things.
At Gucci, he oversaw international marketing and strategic planning. Back at Procter & Gamble, he worked in a diverse range of products, including cough and cold medicines, health and beauty, laundry and even food.
An advocate of the power of listening, Freda visited Estee Lauder’s operations in 140 countries.
“The way my thinking and creativity goes is listening, connecting and creating,” he says.
Successful leaders personally understand how innovation happens and they try to imprint their behaviours as processes and philosophies within their organization.
Marc Benioff, CEO of Salesforce.com, which has ranked as number 1 on Forbes’ innovation champions list for two years running, gains inspiration by working with young entrepreneurs. These young entrepreneurs include Drew Houston, founder of Dropbox and Max Levchin, founder of Slide and a key part of Paypal’s early days.
The innovation premium at Apple during Steve Jobs’ first tenure from 1980 to 1985 was at 37 per cent. During his absence from 1985 to 1998, Apple’s innovation suffered immensely, dropping to below zero. After he returned to the company, innovation climbed back to a healthy 50 per cent.
Time will tell if Steve Jobs successfully instilled a sustainable innovation philosophy in Apple. Leaders must understand innovation and put their knowledge into practice. If they don’t, their organizations don’t stand a chance.
Forbes’ top 10 most innovative companies
Listed with their innovation premium
- Salesforce.com – 73 per cent
- Alexion Pharmaceuticals – 72.3 per cent
- Amazon.com – 58.3 per cent
- Red Hat – 58.1 per cent
- Baidu – 57.6 per cent
- Intuitive Surgical – 54.0 per cent
- Rakuten – 51.5 per cent
- Edwards Lifesciences – 46.9 per cent
- Larsen & Toubro – 46.1 per cent
- ARM Holdings – 45.4 per cent
The Forbes article can be found here.
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Managing Director, The Strategy Group
Dr Tobias is an accomplished innovation consultant and entrepreneurship strategist, drawing expertise from the academic, entrepreneurial and corporate worlds. Jeffrey’s commercial and business experience is particularly focussed on lean startup, design thinking and leadership. Prior to The Strategy Group, Jeffrey was Cisco’s Global Lead for Innovation in the Internet Business Solutions Group helping Fortune Global 500 companies improve customer experience and grow revenue by transforming how they do business.
Jeffrey is a professor of innovation and entrepreneurship teaching MBA students at the Australian Graduate School of Business at the University of New South Wales. An active angel investor, Jeffrey is on the board of various well known startups. Jeffrey’s corporate background includes leading global innovation strategy at Cisco, working with large corporates such as Adobe, Westpac, Telstra, Woolworths, and Perpetual.