Summary
On June 23rd, the renowned US magazine MIT Technology Review published its annual innovation ranking “50 Smartest Companies”. It differentiates from other rankings as it is not provided by a an external partner, but from the editiorial staff of the magazine itself. To assemble the list of the most innovative companies worldwide the editors of MIT Technology Review claim not to have counted patents or PhDs, but “rather have asked whether a company had made strides in the past year that will define its field” and to “highlight where important innovations are happening right now”. Thus, unlike other innovation rankings – e.g. Thomson Reuters “Top 100 Global Innovators” – this list is not based on quantitative measures such as patents or R&D spending, but subject to the personal, non-representative perception of an editorial jury.

This year the jury has rated Tesla as the winner in terms of innovation because – in their view – the electric car maker “is extending its battery technology from cars to residential and commercial applications” and because the Palo Alto-based firm “has projected a $5 billion investment to build its battery ‘gigafactory’ in Nevada”. As in previous years, the Top 50 list is dominated by US companies, whereas European and Asian companies are clearly underrepresented. With one exception though, as there are three Chinese-based companies in the Top Ten: the smartphone producer Xiaomi (at #2), the world‘s largest online retailer Alibaba (at #4) and the internet service portal Tencent (at #7). Last year, no Chinese firm made it to the Top Ten of the ranking. This remarkable rise of Chinese companies might reflect that China is catching up with the traditional “innovation power regions“. For example, this year not a single Japanese company is listed and only one Germany-based (ThyssenKrupp at #35). Samsung (last year at #4), BMW (last year at #7) and Siemens (last year at #24) completely disappeared from the Top 50 list, as compared to 2014.

The “50 Smartest Companies” list can be applauded because it provides a new and different perspective on innovation leaders different than the “usual suspects” like Apple or Google that regularly top other innovation rankings. The big caveat is that its methodology is merely based on the personal views of its editorial team – and therefore highly subjective. It is also irritating that the methodology is not easy to find on the internet and that the criteria for the individual evaluations of the jury are not disclosed. The fact that the “50 Smartest Companies” is published on a yearly basis, allows comparisons and see trends over time – one key added value of rankings.

Summarizing, MIT Technology Review’s “50 Smartest Companies” is a partially useful ranking to learn about allegedly innovative companies and to identify trends over time. However, caution is necessary: The companies listed are nothing more than a subjective evaluation of a non-representative small group: MIT Technology Review’s editorial staff. The biggest caveat is that the authors do not provide any reference on how exactly they got there. More transparency in the future is desirable. If the makers of this ranking work on these weaknesses, this ranking has potential to be seen as an important benchmark in the field of innovation trends worldwide.

You can access the ranking at: http://www.technologyreview.com/lists/companies/2015/