According to research from Bocconi University in Italy, the most innovative companies are those with “holes” in their structure.
The reason for this is because companies with these holes are forced to look for people to look externally for knowledge, allowing them to subsequently share that knowledge and innovate from it.
“A structural hole is a gap between two individuals who have knowledge in different areas,” wrote study author Marco Tortoriello, Professor of Strategy and Organization at Bocconi University. “A position rich in structural holes—that workers can fill talking to people with different skills—is significantly associated with a higher likelihood of generating innovations based on external knowledge.”
Conversely, a company with a very dense and homogenous structure, particularly if it compartmentalizes knowledge and keeps people with different skills away from each other or even blocks their communication “makes it more unlikely [that workers will] absorb, decode and share external knowledge.”
According to Tortoriello, “the problem of any large organization is to break the structural homogeneity that causes the compartmentalization of knowledge. The challenge is to build relationships that bridge across gaps in the organizational social structure.”
Tortoriello’s research has pulled on two different, and usually separate trends in management research. One deals with external knowledge, and the other with “absorptive capacity.” By bringing these two ideas together, he was able to figure out something that others had missed.
While it’s not a new idea that homogeneity harms innovation, researchers now have a better idea of how that happens, which can allow management to better organize their employees in order to fix the problem.
“When hiring in traditional organizations, a common rule of thumb is ‘Hire people you would want to have a beer with,’” wrote innovation consultant Jorge Barba. “Actually, if you want to innovate and remain relevant, only hiring people like you will lead to failure. More of the same people creates myopia, so a multiplicity of viewpoints is your best defense against it.”
