Corporate culture is widely viewed as a key factor in innovation. So for its fourth annual innovation survey, Michigan-based accounting firm Plante Moran PLLC asked Midwest executives, managers and employees in small and mid-sized companies how culture affects innovation and growth. Tom Kinder, the firm’s Chicago office managing partner, gave us a preview of the findings, from 400 respondents, to be released later this month. He explains how the survey influences his leadership and how a focus on innovation shaped the firm’s new office prototype in Chicago.
Q. What did you hope to learn from the survey and what did you find?
A. The goal was to figure out corporate culture’s role in innovation. We found that in order to be innovative, the first thing you have to have is a great culture. If you have trouble attracting people to your company and have turnover, you need to focus on those problems first. Most of the companies we surveyed felt like they had a pretty good culture. But only 10 percent of our respondents reported they had a good culture and revenue increases of 30 percent or more.
Q. What did you find out about that 10 percent?
A. They have a line item on their budget for R&D. What was different about their culture is, first and foremost, 100 percent of respondents felt comfortable coming forward with ideas. Their work environments were very collaborative, and the leadership very accessible. They provide the tools needed — Internet access, laptops, more storage, guidance for taking innovation from ideas to execution — and they had recognition programs. Interestingly, the most innovative companies had the lowest percentage of monetary-recognition programs. It was more about verbal recognition; maybe they posted the idea of the month versus (giving) a $200 reward.
Q. What did you find about the lower-performing companies?
A. (Focusing on) the companies that did not see revenue increase from innovation but said they valued innovation, 75 percent did not have an R&D budget line item. By contrast, 60 percent of the higher-performing companies did. Under continuous-improvement programs, only 40 percent of the lower-performing companies have a formal program versus 58 percent of the high-performing companies. Then, for hiring due to innovation, 44 percent of the lower-performing companies have hired employees for new processes or products compared to 75 percent of the higher-performing companies.
Q. How do these surveys inspire how you lead your culture?
A. If I have an issue, I express it. But I’m also the managing partner, so it’s made me think about, “Would (an employee) come and tell me that?” This has me thinking to ask my team and to push the partners to find out if are we fostering that.
Q. Did you build your new office to enable innovation?
A. That was the focus. We did surveys to let our employees say what they want. Everybody has desks now that go up and down so you can stand up. That was the one thing that everybody wanted, and I wouldn’t have guessed it. Our conference rooms vary. If you went to one of these startups at 1871 — and we do work for them — there may be only a couple of (our) people on that job. So we’ve set up smaller conference rooms so they can work together. For a large audit we have bigger conference rooms. The partners and senior managers are in interior offices with glass walls, and I look out to a space where there’s 25 young staffers on the (open floor plan) and they get all the natural sunlight coming in.
Q&As are edited for length and clarity.
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