Leadership recipe for a culture of innovation

In my experience, by far and away the most important ingredient for a culture of innovation, is the organisation’s supervision and leadership style. I mean a strong inclination and emphasis on constructive behavioral styles (such as achievement, self actualisation, encouraging and affiliative) as opposed to more traditional task oriented and defensive styles which foster fear and aversion to risk.

In addition to this base ingredient, job related factors such as role clarity and goal alignment, coupled with the learning and development environment and the degree of job empowerment are critical components of the recipe, along with organisational factors such as workplace fairness and trust.

As a leadership team, all of these parameters are within your control and at your disposal. So why is it so hard to serve up an innovative culture?

In the digital world in which we now live, leadership needs to start at the top. Too many CEO’s are still not digitally savvy (in fact often the opposite) and hence anything “technical” is delegated a fair way down in the organisation. The business transformations that are possible (and now expected) are not “technical” they are business related and need leadership to have the courage to pursue change and rethink old paradigms and business models, particularly around service delivery and external collaboration, but also in internal efficiency and running the organisation itself.

We know that client behaviours and expectations have changed dramatically and forever, following some of the digital disruptions we have already seen. Traditionally, CEO’s don’t like rapid change, and there are many examples where CEOs or Boards have left it too late. To create an effective innovation culture, leaders will need entire ecosystems to function, all moving together, with a clear outcomes focus. Joint customers will be the new status quo. The notion of an organisational perimeter does not apply in the digital world.

Courageous Leadership

My first ingredient: more courageous leadership when it comes to technology – from the top down. The organisation needs to hear directly from the top, the compelling case and their express willingness to explore and innovate as part of everyday functions. I have found that flatter structures (less hierarchical control) combined with strong staff engagement, creates an environment where innovative solutions can be conceived, supported and thrive.

They also facilitate improved direct communication. You've got to encourage and invite the people that work for you to challenge you and always be testing existing practices to see if there is a better way. No one has a mortgage over good ideas. Don’t get me wrong though, performance and holding people to account (management) are still as important as they always have been. It’s just how you go about it.

Enabling line-of-sight for the whole organisation

As a surveyor by base profession, the term ‘line-of-sight’ has a specific meaning for me. As a chief executive, I have applied it conceptually to ensure every staff member has line-of-sight to the corporate vision/objective, to the program/division they belong to and then right down to their own work plan and expected/actual performance. It sounds obvious, but common sense is not always so easily put into practice. I have rarely seen complete and explicit alignment at individual, team and organisation levels, yet without it, you can’t enable both bottom-up and top-down management strategies.

Fostering a culture of trust

Following clarity and alignment of resources, the culture(s) need to be developed and nurtured. It takes time for organisational trust to be the new normal and for fairness to be the accepted modus operandi. Often this is espoused, but management actions are the exact opposite and stifle or inhibit trust. There can’t be a blame culture, and the organisation needs to be explicit about its appetite for risk, such that every employee understands the tight and loose properties acceptable.

Alignment of capability

After that it becomes talent management – perhaps the final ingredient. Have you got the right capabilities to do the job?, are their visible growth paths/opportunities?, is there adequate and deliberate refresh?, is there sufficient diversity?. These areas are often better done and more visible in our high performing sporting teams. Why do we not have the same talent management philosophy within our non-sporting organisations?

It’s abundantly clear that as a country, or as an organisation, or as an individual, we have to be more innovative, more technologically advanced, more enterprising, more competitive, and more productive. In essence, innovation is change that creates value and should lead to greater productivity in delivering competitive advantage and economic growth. We know what the ingredients for innovation are but do we know the recipe for how to do this? This is where strong leadership is essential.