Leading to Innovate

Managers must create the right corporate environment before their workforce can truly innovate.

By Jane Hosking

Innovation is essential for a company to maintain its competitive advantage. But the term is still thrown around by managers who really don’t know how to lead their companies in ways that truly foster a creative environment. And while many startups are successfully launched on the back of an innovative idea, they often fail to establish a company culture with the right structures, strategies, and processes to build on the initial innovation.

Taking inspiration from some of the world’s top business leaders featured in Leading for Innovation and Organizing for Results, a popular book in the business world, we’ve created a list of tips for managers who really want to use innovation to take their company to the next level.


Creative people are central to the innovation process and it’s a leader’s responsibility to identify them and the value that they contribute to a company. Leaders must connect creative people to the entire organization and provide access to senior decision makers so that new ideas can be shared. It’s also important for leaders to understand that creative people come in all shapes and sizes and aren’t only found in the upper echelons of a company. They must be open to creative ideas from everyone in their company.


While leaders often say they want innovation, they often fail to provide the right environment. This leaves employees entrenched in structures and procedures, laboring under strict hierarchy and control. Leaders need to protect creative people from the bureaucracy and legalism within an organization, and allow them room to be creative. This requires building the right structure within an organization to avoid discouraging ideas and innovators.


The attitude of leaders towards creativity and innovation is vital for the creation of truly valuable ideas. Being overly rigid, clinging to the status quo, and insisting on doing new things the traditional way will significantly discourage innovation. The most successful companies are always prepared for change. This means that leaders must be open and accepting of imagination and even eccentricity.


One of the key things that organizations need to be aware of in order to encourage innovation is that risk-taking and failure is an essential part of the creative process. Equally, risk avoidance can be an obstacle to innovation. Leaders must create a company culture that embraces risks and wild ideas and which tolerates the occasional failure. While managing the level of risk is important, leaders must remember that innovation often requires many failed attempts before success is achieved.


It’s important for leaders to invest in creativity instead of focusing only on measurable returns. For example, a Google policy of encouraging its creative staff to invest 20 percent of their time working on personal projects has directly led to the creation of some of the company’s most successful innovations, including Google Maps and Gmail.


While financial bonuses can be a good way of rewarding employees who come up with innovative ideas, recognition from managers and peers can be even more effective. It’s best to work out a system of rewards and recognition that suits your company. In doing this, be careful not to let rewards create a culture of competition where employees work against each other. Also, ensure that you don’t let the introduction of an external motivation replace your employees’ intrinsic motivation.