UK companies can grow faster than rivals in Europe if they solve their communication issues, Microsoft research reveals

UK companies that encourage staff to be innovative expect to grow more than rivals in other European countries, according to new research by Microsoft and the London Business School.

A survey of 9,000 employees and managers across 15 European countries found that innovative firms in the UK are 13% more likely to expect double-digit growth in the next five years than innovative companies from elsewhere in Europe.

Across the continent, firms that encourage innovation are more than twice as likely to expect rapid growth than those who do not, suggesting that having a culture allowing employees to experiment with new ideas makes business sense. This difference is only amplified in the UK, with innovative firms in the country almost three-times as likely to expect high growth.

However, there are barriers to innovation and change in the UK, some stronger than in Europe. When trying to implement changes, British firms are 40% more likely to struggle with communication. This makes it the third biggest barrier to change in the country, after a lack of technological support and a perceived lack of need for change, while it is only the sixth biggest across the rest of Europe.

Vahé Torossian, President of Microsoft Western Europe, said: “Our customers and partners across Europe tell us that keeping up with the pace of digital transformation and innovation is among their chief concerns. What they may not be considering as thoughtfully is how their workplace culture could help them innovate – or hold them back.

86% of leaders at highly innovative companies say unlocking collaboration is essential for future growth

“To stay a step ahead of the competition, companies from every industry are looking for new ways to improve their business, from embracing the latest technology to shifting strategy, to diversifying and developing their workforce. And as you might expect, our customers and partners are eager to leverage innovations like artificial intelligence and the cloud to propel their businesses forward.”

While it is clear that firms in the UK need to deal with their communication issues if they want to benefit from innovation, the research found that innovation leaders across Europe are doing more than just encouraging conversation. Facilitating collaboration, empowering teams and helping employees stay “in the zone” are just some of the steps that firms can take if they want to see the double-digit growth the continent’s most innovative businesses are expecting.

Innovative companies are going beyond tearing down internal silos and are making efforts to build bridges between teams. When asked how important internal collaboration was to growth, 86% of innovative firms across Europe said it was very important, while only 72% of less innovative firms agreed.

A quote from Dr Michael Parke of the London Business School

However, the approach to encouraging collaboration must be thought out, as workers were found to lose up to 52% of their optimal work time due to unnecessary interruptions such as emails and meetings.

Dr Michael Parke of the London Business School, a collaborator on the research, said: “Decades of research tells us that one of the most important contributors to people’s engagement is being able to make progress on meaningful work. Protecting employees’ focus, so they can make quick progress on their important work goals, is vital for their engagement, accomplishment, and willingness to adapt to changing demands.”

The research found that a key part of helping staff stay in the zone was empowering them to work more flexibly.

Innovative companies are also more likely to make employees feel their voice is heard – 74% compared with 43% of non-innovative businesses.