Management Articles


Business Creativity and Innovation
How to Build an Innovative Culture

By: Dr. A. J. Schuler

Dr. A. J. Schuler is an expert in leadership and organizational change. To find out more about his programs and services, visit or call (703) 370-6545.

More and more, today’s competitive climate requires organizations to institutionalize the process of innovation - to plant the seeds of creativity that could utterly transform a business. Creativity necessarily involves the destruction of old - and sometimes comfortable and perfectly good - ways of doing business. But for companies willing to take the risk - and for leaders committed to building innovative cultures - the first requirement is to understand the creative process, and the second is to commit to policies that support the creative process.

The Four Stages of the Creative Process:

In order to build an innovative culture, leaders first have to understand the four keys stages of the creative process, based on the work of Teresa Amabile, Ph. D. - a psychologist at the Harvard Business School: The four stages are:
  1. Preparation: this is the stage where the creative person or team becomes immersed in the problem. It’s an information gathering stage, and when the effort is a collective one, it involves the forming of roles, areas of special individual interest and the (sometimes loose!) coordination of tasks. The creative process can sometimes stall - or temporarily appear to stall - at this stage, especially when lots of possibilities yield no immediate, transformative insights.

  2. Incubation: in this stage, the original problem may appear to be on the back burner, even forgotten or neglected, but the mind is still at work. Not the logical, linear mind - the part we use most when awake - but the part that dreams, synthesizes, and makes new, weird, original connections. For a team effort, this can mean that the group may not meet for a while, appearing to let the project fall by the wayside. But people will still be thinking, or have ideas occur to them in the shower, or write down thoughts on cocktail napkins, etc.

  3. Illumination: Without warning, ideas or innovations can come any time - the “aha!” or “eureka!” experience. More commonly, there is no immediate “killer insight,” but some new angle that may occur, or some sudden, burning, unexplainable need to return to work on the problem - often a sign of creative “labor pains.” When the creative project has been a team effort, sometimes the only thing needed is to get the original group members together again after a period of time, and then “pow!” - the spontaneous exchange among them can bring forth an idea that no one member could articulate alone.

  4. Execution: This is the stage that separates mere creativity from successful innovation. New ideas require action, stubborn determination, and ability to build change coalitions while marketing the idea to critical skeptics. Perhaps more than anything else, it takes courage and persistence. Since the execution stage is more about social skill than it is about the technical skill that produces the innovative idea, this is the stage where organizational management can be most actively helpful in promoting business creativity.

Five Business Practices that Create Innovative Cultures:

Leaders who want to create an innovative business culture must understand the steps of the creative process, but that alone is not enough. To promote business innovation, executive leaders should commit to the following business practices, and institutionalize them in the culture - by training managers in these practices and then doling out promotions and rewards to those who employ them successfully.
  1. Select the most promising innovators, but encourage unexpected surprises: To build innovative “hothouses” in an organization, executives may want to cull out the most promising idea-generators and provide them with extra resources. Those are the people who can benefit most from the “buffer zones” in step two. But the other practices listed in this section should be generalized throughout the organization, if possible, so that innovators in unexpected places will have the room to produce ideas and results. Leaders should train other managers to understand the stages of the creative process, and evaluate managers based on their ability to promote and shepherd through to completion new ideas that they encounter.

  2. Create “buffer zones” for the most innovative people: Creating “buffer zones” means building a kind of protective cocoon around creative people or around the innovative teams within an organization. That means eliminating the ways that policies or other work pressures get in the way or discourage the information gathering involved in the preparation stage. It also means being sure that the tools and resources are available when creative people go looking around for data or answers to questions. The executive leader for such a group should do the advance work and run the interference necessary to let creative people go through the preparation stage without interference or harassment.

  3. Give innovators room to “play:” For innovators, anything they can do to mess around with the kinds of data or projects that they see as helpful - will be helpful. That can be hard to remember when they seem to have lost their minds, or to have lost their focus! But during the incubation stage, activities that may look like useless diversions - that may not even look like work - are all necessary to allow the deeper parts of the brain to solve a problem and make new connections. For typical results-oriented executives, this can be hard to do - especially when the creative team happens to be a team of executives working to create a new business process. The senior executive who may have assigned the task may be hard pressed to let his innovative team have the time and space to produce truly transformative solutions. The key to letting people have room to “play” is to refrain from judgment of their activities or methods.

  4. Resist the temptation to look for immediate results: Any team can develop incremental solutions or recommendations. There is no business or technological process that can not be improved through study and modification. But to build a culture that truly encourages innovation, the pressure to get immediate results will yield only incremental improvements, and the need to meet deadlines can sometimes kill the creative process before the illumination stage. While it is true that deadlines can focus creative teams and encourage timely ultimate illumination, setting deadlines should not be overused because they often will interfere with the creative process. Close communication with creative people working on a project can help leaders develop a feel for when setting a deadline will help, rather than hinder the process.

  5. Commit to driving the best ideas through to implementation: Innovators are seldom the best salespeople for their ideas. They are, by nature, more likely to work in isolation, play with their ideas, or generally rub others who are less creative the wrong way. The business leader who want to encourage innovation must act as the first-line filter to test the best ideas and solutions, choosing which ones are the right ones to see through to fruition. Then the executive advocate must commit to the internal sales and marketing project to build coalitions that will bring the new idea into a reality. This takes courage and persistence, and an ability to work the political and social process involved in getting others to adapt to innovation. This is important, not only to reap the rewards of innovation in practice, but to encourage other innovators by showing them that their best efforts will actually be adopted and see the light of day - in your organization, and not your competitor’s!

Leaders who want to encourage business creativity must be sure also to build talent driven, positive cultures that place a value on learning. To see if your organization fits the bill, here’s one quick test: can any employee at least two steps removed in the organizational chart openly ask a question that challenges a firmly held opinion of the CEO? If the answer is “no,” then your organization is probably not as open as you think it is, and you’ll need to reassess your culture if you genuinely want to promote innovation - and reap innovation’s rewards.

© Copyright (c) 2002 A. J. Schuler, Psy. D.

Other Articles by Dr. A. J. Schuler

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