Fostering a Culture of Innovation: Strategies for Success

Innovation is a vital aspect of any business, but it can be especially challenging for larger organizations. Even with an army of talented, intelligent and capable employees, they struggle to adapt to changing market needs. The reason? Companies lack an experimentation mindset. Stephen Borengasser, VP of product management at Three Five Two, explains that larger organizations are often too confident in relying on proven growth strategies and operational processes. Companies must be willing to experiment and put things in market quickly to learn from their successes and failures. 

Stephen suggests two ways to incentivize innovation in larger organizations: by allowing employees the freedom to experiment and think differently, and by having an internal entrepreneur who is driving change within the organization. He also highlights the importance of empathy and a culture of feedback in leading innovation teams. By understanding and accepting one another’s perspectives, vulnerabilities, and histories, team members feel safe contributing and innovating. 

Innovation Incentives and Intrapreneurship

Innovation is particularly difficult for larger organizations. Without a culture that embraces change and innovation, they struggle to stay relevant and create growth in a market experiencing shifting customer needs.  Why is it so challenging for companies to develop a culture of innovation? Stephen states that typically, it’s because companies lack an experimentation mindset.

“They just haven’t had to do it well in the past.” states Stephen. “They’re confident in relying on proven growth strategies they’ve designed operational solutions for. Companies must be willing to put things in market quickly and learn. Without that, it becomes very challenging to do everything else you need for it to be successful.”

Stephen explains that there are two ways to lay the foundation for a culture of innovation: incentivize innovation or promote an internal entrepreneur, or intrapreneur,  who is responsible for driving change.  

The first is self-explanatory. Leaders can incentivize innovation by allowing those within the organization the freedom to experiment and think differently – and reward the use of that capacity toward innovation. The key here is to give teams license to fail (and perhaps, find something that won’t fail in the process).

The second is more nuanced. An intrapreneur is dedicated to finding pockets of support within the organization –  even if there’s misalignment with incentivizing or roadblocks along the way. This is much more challenging because the intrapreneur will likely not have the top-down support and will have to lead from within. (No easy task!)

To be successful, the intrapreneur has to have a keen sense of how the organization operates and its decision-making processes. Is the organization more data-driven? Does leadership need to have hard, financial evidence before being willing to take a leap? Are they risk-averse and restricted by legal? Has the company tried innovating in the past unsuccessfully?  Having a clear sense of how the company makes decisions – and the information they need to have before making a decision – is key. Intrapreneurs must be able to understand how to connect their goals with the organization’s goals. They need to craft a cohesive story to articulate how everyone will be successful. Without this approach, obtaining resources to keep a growth initiative alive during times of uncertainty will be very difficult.

Amazon is a great example of how a company can create a culture intrapreneurs thrive. Across the organization, Amazon employees are encouraged to take ownership of ideas. Jeff Bezos has said, “You need a culture that high-fives small and innovative ideas, and senior executives [that] encourage ideas.” One of those ideas came from engineer Charlie Ward whose idea was to overhaul Amazon’s shipping experience. Amazon Prime was born out of that idea and now represents more than $19B in annual subscription revenue for the company.

Collective Intelligence and Deliberate Collaboration

Bringing a new product or technology to market successfully can only result from a team making many challenging decisions at a very high level. Those decisions have a higher chance for success when they result from the combined skills of your team. As its leader, how can you motivate this level of contribution from your team?

First and foremost, the team leader’s role is to create space to create collective intelligence. With deliberate and maximum collaboration from all the perspectives within a team, collective intelligence will emerge. And with it, your probability of success increases. If you have financial analysts, product engineers and marketing all on your innovation team, it’s your job as a leader to understand that each specialty and each team member has a unique perspective and role to play. You must create an environment that allows each of them to fully participate and contribute their point of view – and feel safe in doing so. So then, how do you achieve this?

Teamwork is the ability to work together toward a common vision. It is the fuel that allows common people to attain uncommon results.

Andrew Carnegie

Creating a Culture of Empathy and Feedback

Innovation team leaders should follow two core tenets: empathy and a culture of feedback. Let’s start with empathy. Each team member brings a history that benefit every opportunity. And it’s not about viewing each team as “having baggage”. In fact, it’s quite the opposite. By understanding their history and being able to put yourself into their shoes, you can create a more open space to allow everyone to contribute. You build trust with your team by knowing they’re in a safe environment.

Second, you must create a culture of feedback. Allow your team members to be vulnerable and share feedback. This increases the collective knowledge of the team. Being the leader doesn’t always necessarily mean you know best. When a team fails to innovate, it’s not usually due to a lack of technical skills. Often innovation is stunted because team members never felt the safety to provide feedback. By allowing yourself to be vulnerable and accept feedback without lashing out or becoming defensive, your team will be stronger, more creative, and more innovative. 

For many, these concepts may seem a little “touchy-feely,” and inappropriate for the business world. But businesses are run by people with feelings, histories, and flaws. When you create a foundation of knowing and understanding one another on a human level, vulnerability is created, allowing ideas to thrive. Brené Brown, in one of her many now-famous TED Talks, said it best: “vulnerability is the birthplace of innovation, creativity, and change.”

The reality is that there’s an economic and financial return to having this “touchy-feely” element to your team. We are in a post-pandemic world where employee engagement has declined year-over-year, and talent competition is higher than ever. When employees are happier they’re more engaged. They fully contribute to each opportunity because they know they’ll be heard and be full participants. This creates a positive feedback loop that will get easier and easier over time. And as that trust is built, team members will feel more willing to participate fully without fear, resulting in collective intelligence that will lead to market success through better decision-making.  

A Healthy Innovation Culture

When your company embraces an innovation-minded culture, it’s empowered to put things into market quickly and learn – rather than spending a lot of time in the planning or development stages without getting feedback from customers. Without embracing the experimental mindset, it becomes difficult to do everything else – especially finding success in market. The innovation-mindset allows you to shift from having everything perfected ahead of time to understanding launching a product is about learning and realizing the ultimate test of your hypothesis and the potential for your product or idea is being in market. In short, innovation is the driver of growth. 

As a leader, you can take steps to embody these tenets of innovation. Be vulnerable. Be open to feedback. Be engaged and authentic. When you embody these tenets, you help create space for innovation and growth.