Leaders who are able to successfully transform businesses are incredibly ambitious – but their ambition is first and foremost for the business, not themselves. Time and again research reports have shown that organisations that provide effective leadership and an environment in which innovation can thrive, are increasing their market share, profitability, customer satisfaction and other key performance indicators considerably faster than those that don’t.

Early in its life, while it is still small, a business is agile and flexible, seizing opportunities, taking calculated risks and building its culture on the fly.  There’s a sense of urgency in developing ideas through prototypes and taking them to the market as quickly as possible.  The culture encourages creativity and calculated risk-taking.  As a company grows and becomes more complex (more people, customers, products and orders) problems surface and more defined processes are introduced to manage the business.  The problem is often these systems kill off the entrepreneurial spirit of the business.

How can you continue to encourage a culture of innovation as the business grows?  Here are some suggestions:

• Ensure that everyone knows the innovation goals of the business and are working towards them.
• Make innovation everyone’s job, not just the job of managers or the new product development group.
• Give people the freedom and responsibility to deliver on the strategic direction within a framework.
• Make it easy for people to act on good ideas – give feedback about suggestions quickly.
• Encourage a sense of urgency.
• Encourage reflection and learning from what worked and what didn’t.
• Make sure that your reward and recognition system support the behaviours that you want.  Reward people for successful outcomes, not for the number of ideas they generate.
• Be willing to take calculated risks and tolerate mistakes.  If you don’t tolerate mistakes no-one will try anything radically different.
• Encourage diversity – employ people who are different from you.  Breakthrough innovations often happen at the intersections (of views, of cultures, of disciples)
• Employ people who are smarter than you and learn from them.

Does your business culture support innovation?

1. Do you mention innovation in your vision, strategies or business plans?
2. Do you include the importance of innovation when inducting staff?
3. Do you have methods or processes to encourage and capture new ideas?
4. Do your people discuss new trends or models emerging in your field?
5. Do you apply any resources to new ideas?
6. Do you reward or recognise people who come up with new ideas?
7. Do you encourage experimentation?
8. Do you tolerate failure?
9. Do you communication and measure outcomes from innovation efforts?

If you answered ‘yes’ to most of these questions you are well on the way to developing a healthy innovation culture.