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Making innovation happen: Part 2

Posted on from Changeboard

In part two of an exclusive series, representatives from leading business schools Henley, Warwick, Cass and INSEAD, discuss innovation in the wake of economic ambiguity and impending recovery.

Against a backdrop of economic uncertainty, how can leaders foster a culture of innovation?

Stuart Morris, lecturer in entrepreneurship, Henley Business School (SM): Innovation thrives in a culture of trust and encouragement. When employees are afraid, they will tend to hunker down and go for low visibility.

Tamara Friedrich, associate professor of entrepreneurship and innovation, Warwick Business School (TF): Communicate that innovation is valued and mean it. So many organisations put innovation in their mission statements or promotional materials, but then don’t live it day to day. If you want innovation, you must put resources and action behind the words. Reward those that are innovative, foster a climate of learning from failures rather than fear of failure and don’t change the message too often. Staff will disengage if they get new “missions” too often. I’ve seen employees acknowledge their organisation was promoting innovation, but assumed it was just management’s “flavour of the month” priority.

​Costas Andriopoulos, professor of innovation and entrepreneurship, Cass Business School (CA): 
Three core values are worth passing along:

1. Openly communicate: leaders should expose everyone to critical information that might prove useful somewhere down the line.
2. Create a “no fear” mindset: innovative employees should work in an environment that tolerates mistakes and considers temporary setbacks as a part of the path towards coming up with novel ideas.
3. Celebrate individuality and collaboration: innovative employees have autonomy over their work.  

They need freedom to adopt their own working practices in order to explore the task in question. 
At the same time,leaders should both recognise and reward the team effort. 

Vibha Gaba, associate professor of entrepreneurship, INSEAD (VG): I think when it comes to shaping the culture of an organisation, actions speak louder than words. So how leaders behave matters more than what they say. More importantly, what leaders need to nurture is an environment where people are always encouraged to think what they can do better and how they can do it better.

What are your expectations for the coming year regarding organisations’ leadership capabilities?

SM: More and more business leaders are investing in their own skills and capabilities in order to enhance the performance of the business. They recognise that programmes like the Henley Accelerator provide valuable new skills and excellent returns on investment, both for themselves and the businesses they lead.

TF: I believe that, as the economy continues to recover, more organisations are going to begin investing in innovation again. I think their strategic goals in terms of innovation need to be more long term-oriented, and they should not be so willing to retract innovation funds during tight periods. The organisations that continued to invest in innovation throughout the recession are likely to come out of it with greater acceleration. “In turbulent times people need strong leadership, encouragement and guidance but they also want to feel like they have a real contribution to what’s going on”.

CA: As the world increasingly becomes highly interconnected, there are significant opportunities that are being created for innovation. The successful leaders will be the ones who do not believe that all the best ideas come only from them and their senior management team, but also from individuals throughout the organisation (e.g. different idea hubs) or from outside the corporation altogether (possibly by developing partnerships with universities or research institutes, emerging start-ups etc).

VG: I think organisations need to pay more systematic attention to developing their leadership capabilities and pipeline. There is a lot more talk about it than actual investment, and they need to a emphasise this at the very first level of leadership (first-time managers). I also think they need to pay greater attention to retaining high-potential female managers.

What advice would you give to leaders to win the respect of the people they are leading?

SM: Co-create; work with your team to innovate around problems. Don’t be afraid to admit to not knowing all the answers. Asking questions isn’t the same as being weak. In turbulent times people need strong leadership, encouragement and guidance but they also want to feel like they have a real contribution to what’s going on. “Be authentic and realistic in your innovation goals”

TF: Be authentic and realistic in your innovation goals. Allow others to participate in the decision-making process. They feel more invested when they’ve been given the opportunity to voice their ideas and concerns. If they feel invested in the company and its mission and they feel that the company is invested in them, they will look for ways to benefit that relationship – one of which is to come up with creative ideas.

CA: Leaders should push for more diversity when putting teams together and look for ways to help them work more productively and efficiently, enhance their teams’ working abilities, and keep their skill sets under check. Beyond that, they should encourage their employees to voice their opinions, thoughts or even their concerns about the company and its actions. It is all part of creating a sense of ‘ownership’ throughout the organisation.

VG: I would advise leaders to spend time reflecting and learning from their experiences. More practically, this requires creating time and space for reflections, which, I guess, is difficult because there is a strong bias for action in organisations. I also say this because leaders need to rely a lot on their judgement, especially when operating in turbulent environments. You develop better judgment by being aware of your biases and being more mindful and reflective. You learn not only from your own experiences but also from others’ experiences. What it ultimately fosters is strategic and processing agility to adapt in unsettled environments.

How can leaders lead with a ‘growth mindset’ and encourage this mindset among the people they are leading?

SM: Reward and celebrate suggestions and innovation. Encourage a culture that supports open discussion without ridiculing ‘silly suggestions’. Something someone suggests that seems silly might be the kernel of an idea that inspires someone else to come up with a killer solution. Edison was ridiculed for the hundreds of failed attempts at making a viable lightbulb. If he had given up at any previous step he wouldn’t have got there. Innovation takes lots of small steps towards the killer idea.

TF: Growing the organisation is about finding new opportunities to capture value. Leaders must enlist everyone in the mission of finding opportunities to capture value in their work, regardless of their area of work. If people feel invested in the company and its goals, they will naturally look for opportunities to improve it – whether that is seeking new market opportunities, developing a new product, or finding a unique way to cut costs, each of these can help the organisation grow. Leaders can’t just set the growth target, they must articulate how each person in the organisation can play a role in getting there. “Leaders should push their people beyond what is known and what they are comfortable with, to discover new ideas”

CA: Leaders must master the art of striking a delicate balance between stretching their employees’ capabilities, yet assisting them to build confidence when facing uncertainty. Leaders should push their people beyond what is known and what they are comfortable with, to discover new ideas. But there is a thin line between always challenging people and creating a culture of insecurity “When it comes to shaping the culture of an organisation, actions speak louder than words. So how leaders behave matters more than what they say” and fear. Staff should feel challenged by their environment but not threatened by the fear of losing control within it. Helping them to build a belief in themselves and their work counterbalances uncertainty.

VG: I don’t think leaders should promote growth for the sake of growth. It has to be a part of a well-crafted corporate strategy of the firm. The broader mindset that leaders want to promote in their organisation should be about excellence – continuously striving to create value for customers, employees and other important stakeholders.

The big Idea

The problem:
In today’s fast-paced world, characterised by constant change and fierce competition, continual innovation is essential for organisations to survive and succeed in the long-term. Yet for many businesses, innovation remains a difficult concept to articulate, which means they struggle to implement relevant strategies to promote and manage it. As a result, many organisations are left unable to innovate and consequently cannot create new value.

Making it happen:
As the world becomes increasingly converged, huge opportunities are created for innovation. Successful leaders will be the ones who do not believe that all the best ideas only come from them and their senior management team, but also from people across the organisation or from outside the corporation (eg: by developing partnerships with universities, research institutes, emerging start-ups etc).

Leading change:
Create a sense of ownership throughout your organisation by encouraging your employees to voice their opinions, thoughts and concerns about your business and its actions. Reward and celebrate those who are innovative, encourage a culture that supports open discussion, foster a climate of learning from failures rather than fear of failure and don’t change the message too frequently.

About the roundtable leaders


  • Stuart Morris (top left) is a lecturer in entrepreneurship at Henley Business School.
  • Vibha Gaba (top right) is an associate professor of entrepreneurship at INSEAD.
  • Tamara Friedrich (bottom left) is an associate professor of entrepreneurship and innovation at Warwick Business School.
  • Costas Andriopoulos (bottom right) is a professor of innovation and entrepreneurship at Cass Business School.

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