Innovation Is As Much About Environment As Ideas

Companies need to create the right environment to foster innovative thinking


When the word innovation is used amongst the general population, the consensus is that it comes from people like Steve Jobs or Mark Zuckerberg. The truth, as most working within innovative companies know, is that it comes from many different places. This isn’t simply about having a suggestions box and a boss with an open-door policy, it means that the best ideas come from listening to people throughout the company in an inclusive way - not simply waiting for them to share ideas with their leaders, but actively encouraging them to do so.

All we need to do is look at the consistently most innovative companies in the world according to PWC - Apple and Google/Alphabet - who have been number 1 & 2 since 2010. In that time they have both increased their R&D spend by 523% and 339% respectively, but the R&D spend alone does not make them the most innovative as Apple currently sit 11th in total spend, and Alphabet are 4th. It shows that there is something else that makes these companies so innovative and it is the environment in which they foster innovation.

When discussing innovative environments, we are not talking about quiet working spaces, beanbag areas, or slides within offices, but the climate in which innovation can take place. It is something that an Ideo survey recently found, showing that if people felt comfortable presenting new ideas or challenging old ones, the company became more innovative - ‘When a majority of team members who took the survey said that they felt comfortable challenging the status quo and acting with autonomy, the chances of a failed launch decreased by 16.67%.’

However, this ability to express yourself is not something that comes from only being able to communicate with others in the company. It requires the company to be stable itself. It is not difficult to see that if people are worried about their jobs, they are unlikely to go their superiors to say they disagree with how something is being done. Equally if people feel under pressure because the company is underperforming, they are unlikely to be thinking innovatively, they will be concentrating on doing their jobs and worrying about the potential outcomes. It is no coincidence that both Apple and Alphabet/Google are in the top 10 most profitable companies in the world. The innovations create the profit, but equally the security that profit brings then provides more scope for innovation and experimentation.

Part of this stability comes from clear communication on every level, from the leadership setting clear visions of what the company represents, through to team leaders clearly stating the purpose and mission of an individual project. Ideo’s study found that ‘projects and strategic solutions succeed 20.40% more often when leaders articulate the company’s mission clearly and then reliably practice what they preach.’ It is something that Google and Apple are both famous for, Apple with their clear design-led approach to everything and Google with their connect the world and ‘don’t be evil’ approach. If employees can clearly frame ideas within these parameters, it makes it far easier to ideate new projects that are likely to become successful.

However, there are some additional elements that help, with Alphabet’s 20% rule a prime example of it.

Employees will always have great ideas if they have the time to think about and work on them. Expecting innovation to happen in a high-pressure, target focussed environment is wishful thinking. This isn’t to say it can’t or won’t happen, but the chances are considerably slimmer. Gmail, for instance, came not from somebody at Google having a bright idea midway through a sales call, it came during the 20% of time they are allocated for new ideas. Although this relatively extreme approach may not be possible for every company, the lesson is simply that giving people the time and space to innovate is naturally going to result in more, and better, ideas and projects. It can take a number of different forms, it doesn’t need to equate to 1 day per week, it could even be 1 afternoon per month or an hour every week, but within this time people have the scope to experiment, something that is essential to innovation.

Experimentation also brings its own challenges that companies need to overcome, and it is probably more important than any other. This is fostering the idea that failure is ok.

Innovations all have the same broad goal - to solve a problem. It is not as simple as coming up with a workaround for an issue though, it needs to be the best solution to a problem, which almost nobody will do on their first try. If a particular idea doesn’t come to fruition, it should never be viewed negatively, instead, as Bill Gates famously said, ‘It's fine to celebrate success but it is more important to heed the lessons of failure.’ A failure within a particular innovative solution should not shut down the project, it should instead narrow the list of potential ideas to get the eventual end goal. There is clearly a limit to how far an idea should go, which should be clearly defined, but too many companies fail in innovation not because of a lack of good ideas, but instead in the punishment or lack of support in the ones that don’t work.

Innovation is not something that happens in a bubble, it is something that needs to have the right environment to succeed. Ideas need space, time, and support to succeed, and even when people have eureka moments these come from time spent thinking about a problem. It is no coincidence that Archimedes wasn’t working when his came, he was in the bath. Giving your employees the time and flexibility to have their own eureka moments will bring the rewards of strong innovative ideas.

Interested in R&D? Attend the R&D Innovation Summit Chicago 2018

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