No matter how many times I see this data, I still find it shocking.
I know there’s lots of talk about how the business world is moving and changing faster than ever, but this is kind of scary:
- In 1960, the average lifespan of a company on the S&P 500 Index was almost 60 years. In today’s fast-paced digital landscape, the average age of companies listed on the stock exchange is under 20 years old.
- Since 2000, a remarkable 52% of Fortune 500 companies have either gone bankrupt, been acquired or ceased to exist altogether. (Source: Mass Challenge Corporate Innovation)
What’s going on here? Well, one reason companies are disappearing so quickly is they get lazy. It’s easier to create a new version of an existing product than to create something radically new and better. Innovation, in other words, is at the heart of this challenge.
But innovation doesn’t happen unless your culture is built to sustain it.
Tim Brown, Chair of IDEO, said it well: ”If you want to be more innovative, you have to think about the culture that you’re going to build that allows you to do this over and over and over again.”
I’m not sure that companies pay enough attention to the fact that you can’t innovate without the right behaviors in place.
To unlock creativity, your people need to have room to experiment and fail. Your leaders need to be active listeners and empathetic communicators.
You need to be relentless in communicating your clarity of purpose and a deep respect for curiosity and meritocracy.
To avoid disappearing and being just another statistic, every company needs a culture of innovation.
