A culture of innovation. Cue the angels strumming harps because it sounds like utopia. It’s a buzzword that sounds good in board meetings but doesn’t actually exist. For organizations that really do have a culture of innovation, it’s because they’ve carefully crafted it with roots in their organizational structure, people management, and product development processes.
How do you go from buzzword to meaningful cultural change? Let’s start by looking at your organization as a whole.
Most companies aim for innovation, but they struggle to gain momentum for several reasons. First, most are organized in silos, where the goal is simply to pass along a portion of the project to the next team. No one’s thinking about the end product; they’re laser-focused on their deadline and deliverable. Handing off partial products like a baton in a relay race removes the individuals from the proper focus of the project. You fall into an “activity trap,” where you can see people doing all kinds of work but you can’t measure any holistic success for the business. Benchmark your success against your value stream instead of your activity log and you’ll start to deliver high value all the time.
Even if teams are unsiloed and focusing on value, friction will rear its ugly head if everyone’s relying on legacy technology. It’s like riding a horse to work while everyone else is zooming by in EVs. We call this “technical debt” because it puts you in a hole where you can’t innovate at the speed you need to. You need technology that can work as fast as you do. Upgrade or get left in the dust.
Finally, one of the most significant organizational roadblocks to a culture of innovation is trying to mimic a startup too much. This sounds counterintuitive because startups are known for being hungry and innovative — the exact culture you’re trying to create. Startups move fast and fail fast, and while that speed is something to aim for, if you’re at an enterprise, you’ve got to approach failure a bit differently.
Instead, be like other frictionless enterprises and focus on failing small. After all, you’ve already created success. Rushing a radical product change into the market puts you at risk of alienating your existing customers. But failure won't equal catastrophe if you take smaller risks — a new feature instead of overhauling your platform’s secret sauce, for example.
Organizational structure alone won’t create a culture of innovation, though. Sure, you can set people up for success, but remember, these are people. Dotted lines on the org chart and cutting-edge software won’t compensate for people who don’t have the right mindset. That’s why there’s a direct correlation between your innovation and your leadership.
The point of leadership is to connect with people, motivate them, and create a sense of urgency. Great leaders get everyone excited to build what comes next. That can create a temptation to execute, execute, execute. And yes, putting in the work is how you innovate. However, everyone has to be aligned on your vision and mission first. Before you jump into the fire, clearly communicate the vision of the organization, not just the goals of a specific project or department. If everyone can picture what it will look and feel like to hit your organization’s biggest goals, it’s easier for them to stay hungry. That’s where true innovation happens.
One of the most transformative things a successful leader can do is see opportunities in chaos. It’s painful to step up and grow messy teams into high-achievers, but ultimately, it creates a bottom-up culture of innovation where everyone is driven to do more and maintain the sky-high standards you’ve created.
Organizational structure? Check. Motivated people? Check. Now, you need to take a surgical approach to your product development.
In a true culture of innovation, ideas fly fast and furious from all sides. So, how do you decide which ones are worth going after? You need a specific process to vet ideas and determine which solutions must come first. Maybe it’s a quarterly meeting where you go through everything in your figurative suggestion box. Maybe it’s a monthly roundtable. The frequency depends on the velocity of your idea pipeline. After all, the last thing you want is for people to feel like their ideas are going into a black hole.
However you structure this process, you need to start by establishing how you will measure success. How will you learn if this solution solves that problem? This is how you ensure you’re doing work that matters. Otherwise, you’re left with a blank sheet of paper and no real direction.
Speaking of processes, you also need one to determine when and where to pivot. After all, not every idea is a winner right out of the gate. But giving your organization room to fail gives you the freedom to learn. Often, a small group of experts will identify when an idea isn’t working the way it should be. They’ll come up with feasible pivots so you can maintain momentum.
By now, it should be crystal clear — a culture of innovation isn’t something you stumble upon. It requires resources, leaders, and processes with the same North Star. Yes, it’s hard work, and it will not happen overnight. But once you have it, it’s like eating the first bite of the most delicious cake every single day. And who doesn’t want cake?
