The Link Between Diversity and Resilience

New research shows that the most resilient companies are those that continually orchestrate a dynamic balance of four innovation strategies.

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Most managers and academics agree that innovation ensures superior performance. But which innovation strategy or strategies best sustain that performance over time? That is, how can companies manage innovation in order to become more resilient? Resilience is both an applicable and an important concept for companies in turbulent times.

The concept of resilience originates in research on child behavior,1 which indicates that some children prove to be positive, focused, flexible and proactive — in a word, resilient —despite exposure to extremely challenging and stressful environments.2 There are several ways of conceptualizing and adapting the basic idea of resilience to the business world. Some business writers have focused on corporate attributes, while others have focused on issues such as risk awareness, risk protection and the reduction of vulnerabilities.3 In strategic management, resilience has been defined as a process capability; in order to reinvent themselves, companies need to overcome barriers to change and develop multiple sources of competitive advantage.4 We define resilience as the capability to self-renew over time through innovation. Using that definition, we have analyzed a set of resilient companies that have successfully adapted to diverse and turbulent changes over a period of two decades, trying to understand what makes them so capable of continued self-renewal. These companies include some of the world’s largest multinationals. (See “About the Research.”)

About the Research »



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15. S. Thomke, E. von Hippel and R. Franke, “Modes of Experimentation: An Innovation Process — and Competitive — Variable,” Research Policy 27 (July 1998): 315–332.

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