Fostering a Culture of Innovation

Over the years I’ve read a number of articles touting the benefits of corporate culture as it relates to innovation. If you’re like me, you might have wondered what the term “culture” means in a corporate setting. The formal definition of culture is “the customs, arts, social institutions, and achievements of a particular nation, people, or other social group.” When the “social group” is a company, that definition is too broad to be meaningful. Below are three definitions of corporate culture.

• From Investopedia: “Corporate culture refers to the beliefs and behaviors that determine how a company’s employees and management interact and handle outside business transactions. Often, corporate culture is implied, not expressly defined, and develops organically over time from the cumulative traits of the people the company hires. A company’s culture will be reflected in its dress code, business hours, office setup, employee benefits, turnover, hiring decisions, treatment of clients, client satisfaction and every other aspect of operations.”[1]
• From Inc.: “Corporate culture refers to the shared values, attitudes, standards, and beliefs that characterize members of an organization and define its nature. Corporate culture is rooted in an organization’s goals, strategies, structure, and approaches to labor, customers, investors, and the greater community. As such, it is an essential component in any business’s ultimate success or failure.”[2]
• From TechTarget: “Corporate culture is the pervasive values, beliefs and attitudes that characterize a company and guide its practices. To some extent, a company’s internal culture may be articulated in its mission statement or vision statement. Elements of corporate culture include a company’s physical environment, human resources practices and the staff itself. Corporate culture is also reflected in the degree of emphasis placed on various defining elements such as hierarchy, process, innovation, collaboration, competition, community involvement and social engagement.”[3]

As you can see, defining corporate culture with clarity and certainty is difficult. Author John Coleman (@johnwcoleman) asks, “What makes a culture?”[4] He believes he has an answer. “Each culture is unique and myriad factors go into creating one,” he writes, “but I’ve observed at least six common components of great cultures. Isolating those elements can be the first step to building a differentiated culture and a lasting organization.” His six components include: vision; values; practices; people; narrative; and place.

Corporate culture and innovation

Alex Goryachev (@AgoryachAlex), managing director of the Corporate Strategic Innovation Group at Cisco, writes, “Organizations from large enterprises to startups began seeing innovation as a platform for their growth and very survival. They began to view it as a mindset and attitude that must be woven into every aspect of their company culture.”[5] If Goryachev is correct (and I think he is), most companies could have a problem. Tendayi Viki (@tendayiviki), Associate Partner at Strategyzer, writes, “One the biggest challenges contemporary leaders face is that innovation as a cultural practice is yet to take hold inside their companies. Indeed, the most common complaint I hear from leaders is that their companies lack a culture of innovation.'[6] He continues, “Leaders understand that having such a culture in their companies would embed innovation and allow it to be an ongoing process regardless of changes in the outside world. In fact, a culture of innovation would help the company be more responsive to these changes.” Of the six factors identified by Coleman, I believe the three most important for determining whether innovation is part of corporate culture are people, practices, and narrative.

People: Coleman writes, “No company can build a coherent culture without people who either share its core values or possess the willingness and ability to embrace those values.” When it comes to innovation, companies need people who feel free to express and share their ideas. They need people who are open to new ideas. Oliver Wendel Holmes Jr. once said, “A mind that is stretched by a new experience can never go back to its old dimensions.” According to Esther Shein (@EstherShein), it all begins at the top. “If executives and senior leaders lack a mindset to be innovative,” she writes, “it’s likely the rest of the business won’t be open to change.”[7] James McKeen, Senior Vice President and chief technology officer at Empire Life Insurance, told Shein executives need to look for innovative people already in the company fold. He told her, “Organization must nurture the shift [to an innovation culture] by finding ‘naturally innovative people’ from within and encouraging their ideas. Many times, ‘these people fly under the radar; so first, to engender culture of innovation is to not mandate it but go hunting for people naturally gifted in that way.’ These staff members will then encourage others, starting the company on the path of fostering a culture of innovation.”

Practices: Viki believes ingrained business practices could be anathema for innovation. He explains, “Most companies have not adopted innovation artifacts, rituals and practices. Instead, they have artifacts and rituals for running their core business — and they often mistakenly apply these to managing innovation.” Coleman adds, “Values are of little importance unless they are enshrined in a company’s practices.” So what are “best practices” for ensuring innovation is part of your corporate culture? One way, according to Doug Tedder, principal consultant at Tedder Consulting, is to give people permission to innovate. He explained to Shein, “It has to be part of ‘business as usual.’ … You have to define what innovation means and give them permission and the ability to do it. … If you want an innovative culture, that culture has to be inclusive.” Another way to ensure your employees can be their best innovative selves is to provide them with the right tools. William Craig, founder and president of WebFX, explains, “One reason your employees need the best tools available for their field is because you don’t want them to waste a lot of time on busywork or a cumbersome workflow. It’s a poor crafter who blames their tools — but there may very well be something out there that could help your employees do better and more confident work.”[8] Buckminster Fuller once said, “If you want to teach people a new way of thinking, don’t bother trying to teach them. Instead, give them a tool, the use of which will lead to new ways of thinking.”[9]

Narrative: Narrative is the story a company tells about itself. Does your corporate narrative reflect an innovative culture? To be an effective part of your culture your narrative needs to be genuine. By that, I mean your story must reflect what’s really happening within your corporation rather than what you wish were happening. If your company truly embraces a culture of innovation, your employees will excitedly share your narrative and work hard to ensure the story continues.

Concluding thoughts

Even if innovation is an ongoing activity, each generation must learn to innovate for itself. It’s a journey rather than a destination because technology and circumstances are constantly changing. Goryachev reports a survey conducted by KPMG and Innovation Leader Research found 60 percent of companies surveyed said they are still in the early phases of innovation maturity. He adds, “Organizations across industries are slowly but surely figuring out the ingredients of an effective innovation program. They’re learning that they have to secure funding, build dedicated innovation teams and break down cross-functional silos for companywide collaboration.” Shein insists, “In today’s highly dynamic business world, a culture of innovation is king.” Unfortunately, in too many circumstances, the king has no clothes.

Footnotes
[1] Will Kenton, “Corporate Culture,” Investopedia, 17 November 2017.
[2] Staff, “Corporate Culture,” Inc.
[3] Staff, “Corporate Culture,” TechTarget, July 2013.
[4] John Coleman, “Six Components of a Great Corporate Culture,” Harvard Business Review, 6 May 2013.
[5] Alex Goryachev, “Innovation? It Needs to Be Woven Into Every Aspect of Your Company’s Culture,” Entrepreneur, 11 February 2019.
[6] Tendayi Viki, “How To Bring An Innovation Culture To Life,” Forbes, 27 January 2019.
[7] Esther Shein, “How to create a culture of innovation,” CIO, 7 January 2019.
[8] William Craig, “10 Ways To Encourage Company Innovation In Your Employees,” Forbes, 13 November 2018.
[9] Viki, op. cit.