A McKinsey Global Survey on finds that companies rely on multiple organizational models to drive innovation—and that these functions struggle to integrate fully with the business as a whole. The online survey on innovation asked executives about the organizational innovation structures in place at their companies, the strategic and financial objectives these structures have set, and the people and processes involved in achieving innovation outcomes. 

Executives say their companies use multiple organizational approaches to drive innovation and that the success of these efforts depends on integrated strategy and C-level support. Nearly two-thirds of executives report broad innovation portfolios that include more than one type of organizational model, and nearly half say their companies use separate innovation functions that focus on developing new business opportunities.  

The survey also finds that an innovation function’s success is not only a matter of maturity.  At companies where innovation is fully integrated into strategy, executives are six times as likely as those without integrated strategy to say their separate functions meet their financial objectives effectively. More companies with integrated strategies also share organizational elements across the portfolio—a practice that our experience suggests is a boon to innovation programs overall. And 57 percent of all respondents (the largest share) cite clear strategic focus among the factors that are most important to their functions’ success. 

Yet strategy remains an innovation challenge for many companies. Only one-third of executives report that innovation is fully integrated in their organizations’ corporate-level strategies, and nearly half say integrating the separate functions’ strategic objectives with those of their core businesses is one of their functions’ most significant challenges. 

The survey was conducted May 15 to May 25, 2012, and received responses from 2,927 executives representing the full range of regions, industries, and company sizes. 

Complete results of the survey can be found on the McKinsey Quarterly website.