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Most Chief Innovation Officers Are Just Window Dressing

This article is more than 10 years old.

That's the implication of a new research report just released by Capgemini Consulting and the IESE business school. Their annual global Innovation Leadership Study, based on a survey of 260 innovation executives around the world, finds 43% of its respondents saying their companies have a formally accountable innovation executive, up from 33% a year ago. But only 42% have an explicit innovation strategy, and only 11% have a strategy that involves employees, and not just executives, in its development.

Moreover, only 30% say they have an effective organizational structure for innovation, and a mere 21% say they have an effective system of key performance indicators for measuring and promoting innovation; 54% says they don't have any formal KPI set-up at all.

The primary reason executives are involved in innovation—46% said so—is simply because it's their job ("accountability for realizing growth"), even though they overwhelmingly agree that employees get involved in innovation because it's exciting and worthwhile (91% and 89% respectively). Perhaps that makes it no surprise that only 24% of the respondents think they have an "effective organizational alignment of innovation efforts."

What is to be done? The study concludes that "the absence of a well-articulated innovation strategy is by far the most important constraint for companies to reach their innovation targets." It proposes that "there is a need for innovation strategy development in a more bottom-up manner," and "large organizations create so much distance between the executives and those that are tasked to innovate that a disconnect exists between them."

The study concludes with a list of five big implications. I'd sum them up as (1) businesses need to be "formulating a well-articulated innovation strategy and improving [their] understanding of the external environment"; (2) traditional strategy development isn't good enough, and you must instead "move strategy development to the outer peripheries of the company"; (3) companies need to be better designed for innovation; (4) executives badly need to "reduce the level of disconnect between themselves and employees"; and (5) you'd better do all these things if you're going to survive at all.

Read the whole report here.