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Publishers with “innovation role models” 4x likely to be profitable, and other insights from WAN-IFRA

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“I don’t have innovation in my title, because innovation is everyone’s job,” said Gordon Edall, Director of Globe Labs, The Globe and Mail in Canada, speaking at the 71st World News Media Congress last week. Edall was speaking on a panel discussion on how to encourage innovation in the newsroom.

Edall explained that he made efforts to start dialogues with project managers and staff in order to find out people’s opinions and ideas within the company. “We want to encourage new ideas, listen to our staff and minimize any frustration in any way,” he added. James Down, Chief Strategy Officer, Guardian News & Media, also in the panel, agreed that listening to the undercurrent of ideas within a newsroom is key for innovation.

Being responsive, accessible and present is key to igniting that internal fire within your publisher’s staff, the panel suggested. Just as news organizations are becoming increasingly open to audience suggestions and ideas, so should editors and team leaders if they are to drive a culture of innovation within the newsroom.

Caroline Scott, Journalist and WAN-IFRA contributor

Publishers are increasingly relying upon their employees as they experiment to stay ahead of the curve. Management professors Jay Rao and Joseph Wintraub contend that of all the resources required to build an innovation culture, people—especially “innovation champions”—are the most critical. They have a powerful impact on the organization’s values and climate.

Edall appears to be an ‘innovation champion’ or an ‘Innovation Role Model,’ a concept presented in WAN-IFRA’s World News Publishers Outlook. According to the study, companies with Innovation Role Models are more than four times as likely to be reporting significant increases in YoY revenues, compared to organizations that do not.

“Single biggest risk to our future success”

The study also found that reluctance to innovate is the single most important risk to news organizations’ future success. As we see more and more publishers trying to build diverse revenue sources, the critical importance of innovation continues to hold court.

News media firms worldwide confront an array of external forces – whether increasing competition for advertising from Google and Facebook, shifting audience consumption patterns, rapid technology advances, or political instability. But decision makers responding to our survey told us the greatest risk to their business lies within their own organizations – a reluctance to innovate.

Dean Roper, Director of Insights, WAN-IFRA

The study—surveying 235 executives from 68 countries across six continents—used advanced statistical methods to analyze the relationship between organizational culture and organizational success. It found that firms with a flourishing innovation culture did not only survive but were four times more likely to be profitable.  

According to the survey, nearly seven out of ten executives agreed to some extent with the statement, ‘Our innovation projects have helped our organization develop new capabilities that we did not have three years ago.'”

Majority of the executives surveyed—including 43% from the C-suites— said that the biggest risk to future success was not the challenges to their business models, technology disruption, advertising declines, or political instability. It was their firms’ reluctance to innovate.

What questions should we be asking ourselves if the single biggest risk to our future success is not from outside forces but lurking inside our organizations. Many heritage news brands face this dilemma when it comes to completely rethinking their core business. In that process, collaboration is essential for unlocking their innovation potential.

Vincent Peyrègne, CEO, WAN-IFRA

The authors analyzed nearly 80,000 data points to find links between innovation and financial performance at the organizations surveyed. The authors state, “companies that prioritize innovation are more likely to report organizational and financial success compared with companies that don’t.”    

7 building blocks of innovative culture

The study goes on to present the seven building blocks required to build a sustainable culture of innovation in the newsroom, and the ways in which leaders at successful firms approach each block.

The seven blocks are resources, processes, values, behavior, climate, success and innovation role models. Here’s how they impact an organization’s performance.

1. Clear measures of success

Organizations that support innovation have clear measures of success. They can be captured on three levels: External, Enterprise, and Personal.

The survey showed that the extent to which executives perceived their organization’s innovation efforts to be successful was significantly related to positive changes in a variety of revenue streams. These include revenues from advertising (print, online and broadcast), e-commerce and subscription revenues. Further, there was a strong relationship between perceived success and the overall financial performance of the firm as measured by positive 12-month changes in overall revenues and profits.

2. Values

According to the study, truly innovative organizations valued continuous learning, promote creativity and spend generously on being entrepreneurial. These firms scored highly on the values building block and were significantly more like to prioritize the development of news business/products outside of the media sector and investment in training budgets. Further, the higher they scored, the greater was their reported organizational performance.

3. Innovation behaviors

In the case of leaders, innovation behaviors can include the willingness to replace existing products with new or better ones, to inspire employees to innovate and to cut through red tape.

From the employees’ perspective, innovative actions include persistence in overcoming technical roadblocks, making the most of resources when budgets are thin and listening to customers.

Once again, the survey points out that the degree to which an organization exhibits innovation behaviors is directly related to the likelihood of the organization’s success.

4. Innovation Climate

An innovative climate encourages engagement and enthusiasm. It challenges people to take risks within a safe environment, fosters learning and encourages independent thinking.  

The survey shows strong relationships between positive innovation climate and an uptick in digital revenues as well as revenues from sources other than advertising and content sales.

Additionally, organizations that scored high on innovation climate were seven times more likely to be reporting booming revenues, compared to the low scorers.

5. Innovation processes

Innovation processes are the route innovations follow as they are developed—from idea generation to selection, to development and, ultimately, execution. The analysis indicated a strong, positive relationship between firms with clearly-defined innovation processes and their overall organizational performance. Such organizations were also nearly three times likely to report booming revenues, compared to those with less clearly defined innovation processes.

6. Resources

Resources include systems, projects, and people. The study found that an organization’s’ approach to investment in people is directly and positively related to its performance (its financial success, as well as perceived success).

Additionally, organizations that prioritize investment in people are twice as likely to report a YoY increase of 20% or more in overall revenues and profits, compared to those that don’t.

7. Innovation Role Models

The study found a strong relationship between the success of firms and leadership that was supportive of innovation. It states that the “extent to which role models impact the bottom line of firms is much more significant than any of the other components of an innovative culture. And that companies with innovation role models are more than four times as likely to be reporting significant increases in revenues.”

The authors conclude, “Company leaders have both the mandate and the mechanisms to nurture organizational cultures where innovation thrives – and our study results confirm that when they personally rise to the occasion, their companies’ fortunes do too.”

Click here to download WAN-IFRA’s World News Publishers Outlook

Download WNIP’s comprehensive report—50 Ways to Make Media Pay—an essential read for publishers looking at the multiple revenue opportunities available, whether it’s to reach new audiences or double down on existing super-users. The report is free and can be downloaded here.