What do most successful businesses have in common?
Using available resources to effectively execute business strategies, maintaining a strong focus on the customer and structuring the organization in order to support company objectives are the three basic building blocks that high-performing organizations, regardless of industry or geography, have in common. That finding comes from new research by The Conference Board, an independent business membership and research association.
To better understand what traits link the best businesses, researchers identified 56 companies that rank highly in leadership, financial performance and people management. Those companies include FedEx, Coca-Cola, Target and American Express. The study's authors then surveyed 76 executives at 27 of those companies to learn how their businesses are run.
Amy Lui Abel, managing director of human capital research at The Conference Board and a co-author of the study, said that when looking from the outside, it may seem as if these companies don't share much in common. [6 Traits All Great Entrepreneurs Share ]
"However, our survey of executives at those four high-performing organizations, and 23 others, revealed a layer of meaningful commonality underlying their success," Abel said in a statement. "While the DNA of every high-performance culture is unique, they rest on a common catalog of 'genetic' elements that proactive leaders will identify, adapt and incorporate into their own company's identity."
Based on their surveys, researchers uncovered three common "DNA elements" and the strategies involved in each:
Use resources effectively and efficiently to execute business strategies
- Create a culture of rigor and standards for financial stability
- Require process around fiscal management, oversight and decision making
- Execute strategies in an operationally efficient manner
- Align organizational structure to support business strategy
- Create and maintain a culture of accountability
Strong customer focus
- Delivery high-quality products and services
- Create a strong customer-centric culture
- Focus the organization's process and products on customer needs
Organizational capability to support critical business objectives
- Attract and retain talent through strong brand reputation
- Provide learning and development opportunities to all employees
- Require supervisors to set clear goals and manage performance
- Raise employee engagement to drive productivity
- Develop a global mindset among leaders
- Align rewards and recognition to support business strategy
- Help managers create effective teams
"In today's globalized, competitive environment, a huge array of measures — from market capitalization to employee-engagement scores — is available to evaluate a company's success," said Rebecca Ray, executive vice president of knowledge organization for The Conference Board and a co-author of the report. "But such numbers alone reveal little about how an organization succeeds, or fails, in adapting to change, developing new capabilities and executing its long-term strategy."
The study was also co-authored by Amanda Popiela, a research assistant in human capital at The Conference Board.