Business leaders are prioritising profit margins and targets over innovation, according to a new study

The study, conducted by The Open University Business School found that businesses are retaining an executive style management of due diligence to targets and resource management, rather than more radical leadership approaches. This is despite the fact that just 6% of those surveyed believe this management style inspires innovation in a recession.

The majority described executive leadership -where setting measurable goals, managing resources, and planning are the main characteristics - as the primary leadership style in their company.

In addition, despite 81% of respondents agreeing that a recession creates the right climate for organisational innovation, only 40% thought their company was actually leveraging innovation opportunities. 500 managers were interviewed as part of the survey, many of whom thought the lack of innovation laid at the doorstep of upper management.

James Fleck, Professor of Innovation Dynamics said, “It is clear that the same pessimism that has paralysed the world’s financial markets for the past few years is inhibiting those guiding business through murky economic waters. However, considering the rapid rate of technological change in all sectors, companies need to innovate now more than ever. To ignore the opportunities for innovation now is to condemn business as a whole to slow growth or even decline in the future.”

According to the Department for Business Innovation and Skills, Innovation is a key driver of economic growth. Professor Fleck added that “by developing new products and services, companies can create new revenue streams, create new benefits for their customers and themselves and keep their brands fresh and relevant. Moreover, with technology in every sector throwing up rich opportunities for innovation, companies that refuse to adapt will be left behind.”

Despite this, the study found that only 23% of respondents claimed that their company actually measured innovation, which begs the question – do companies care as much about being innovative as they should?

Notes to Editors
Professor James Fleck is presenting at an Open University Business School event on 15th November which brings together leading business specialists in innovation, where barriers to organisational innovation will be further explored among the audience of senior practising managers across private, public and third sectors. Speakers include Ken Keir OBE, Executive VP Honda Motor Europe; Evan Davis, Presenter of Radio 4’s The Bottom Line; Adrian Simpson, Chief Technology Officer for SAP UK & Ireland; Sukhvinder Dhat, UK Practice Leader, Kates Kesler Organisation Consulting; David Harrison MBA, Entrepreneur and Founder & Managing Partner of True Potential; Imran Razzaq; Central Eastern Europe Cloud Lead, Microsoft and Dr Leslie Budd, Reader in Social Enterprise at the OU Business School.
The Open University Business School is a world leader in modern flexible learning and the pioneer of teaching methods that enable people to change their life goals, studying at times and in places convenient to them.

The Open University Business School is one of a select group of schools worldwide accredited by the three leading international accrediting bodies – AACSB, AMBA, EQUIS. It is the only triple-accredited business school that specialises in flexible learning and is home to over 23,000 successful MBAs. Its MBA programme offers residential schools and face-to-face and collaborative learning options.
The Open University Business School was ranked 4th in the executive education, training and development category by Superbrands in 2012.

About The Open University
The Open University (OU) is the largest academic institution in the UK and a world leader in flexible distance learning. Since it began in 1969, the OU has taught more than 1.8 million students and has more than 263,000 current students, including over 15,000 overseas.

The OU came top for student satisfaction in the National Student Survey this year, and has been in the top three universities every year since the survey began in 2005. In 2011/12 it had a 93 per cent satisfaction rating. Over 70% of students are in full-time or part-time employment, and four out of five FTSE 100 companies have sponsored staff to take OU courses.

In the UK’s latest Research Assessment Exercise (RAE 2008) the Open University was ranked in the top third of UK higher education institutions. More than 50% of OU research was assessed in the RAE as internationally excellent, with 14% as world leading.

Regarded as Britain’s major e-learning institution, the OU is a world leader in developing technology to increase access to education on a global scale. Its vast ‘open content portfolio’ includes free study units on OpenLearn, which has had more than 23 million visits, and materials on iTunes U, which has recorded over 56 million downloads. The OU has a 41 year partnership with the BBC which has moved from late-night lectures in the 1970s to prime-time programmes such as Frozen Planet, Bang Goes the Theory, James May’s Big Ideas and The Money Programme.