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How can business leaders encourage an innovative company culture?

How can business leaders encourage an innovative company culture?

Employees are the most vital resource to companies today, thanks to their capacity for independent thinking and innovation. As such, building an open company culture in which they feel able to express new (even crazy) ideas - is important for a company to grow and evolve.

I visited Nordic Business Forum last year and was inspired by Adam Grant’s keynote presentation about the art of giving and taking in the business world. Grant is a professor, an author, a lecturer, has Ph.D. in organizational psychology and is an expert in helping companies achieve groundbreaking business environments.

Based on Grant’s keynote I gathered together few ideas for HR how to develop a progressive company culture which enables innovations:


1. Create a culture where employees are not afraid to talk

Generating a psychologically safe space for openness and honesty is crucial for an innovative company culture. If an employee is not allowed to talk about problems and issues within the company, the organisation will never hear about the biggest issues it is facing.

Bringing up problems is vital even if there is not yet a solution. The unapologetic acknowledgment that there should be one is especially important in developing a supportive company culture.

Generating a psychologically safe environment in this way requires transparency and the ability to accept criticism from management. Likewise, management should receive honest feedback willingly and eagerly, entering into an agreement of mutual respect. Listening to constructive criticism from colleagues throughout the business, regardless of status, is one of the best ways for managers to realise improvement goals.

2. Avoid ‘groupthink’

Job markets are full of so-called ‘ideas people’. But how do we find the most innovative within the pool?

When it comes to teams coming together and brainstorming many workers have tendency to seek consensus and subconsciously adapt their opinions to match those of other team members. Indeed, while brainstorming sessions can be useful in some situations, they have the hidden negative effect of discouraging certain team members from letting their true ideas be known. This is antithetical to an innovative business environment, so it is important to let employees know that (polite) conflict is okay. 

In his keynote, Grant gave a great example of this phenomenon - exit interviews where employees usually give the most honest and constructive feedback to their manager about the company. He pondered what would happen if more companies would utilize entry interviews whereby a new employee starts off their new role by giving their views on the organisation and suggesting possible improvement areas. This would have the great effect of making employees feel that their opinions are valued, as well as providing valuable honest feedback about the company.

3. Rethink the notion of the “cultural fit”

Companies often portray themselves as embodying a certain ethos and way of working and encourage job applicants with an apparently similar outlook on life. Indeed, boasting a workforce that lives and breathes company values is very much in fashion in today’s business environment. In the long run, however, this idea of the “cultural fit” can be problematic. A largely homogeneous working environment can discourage people from breaking norms and boundaries, and suffocate the development of new and profitable ideas.

In this way, companies should consider whether job applicants would complement the current team’s abilities when choosing new starters. Recruiting someone based on their ability to fit in and make friends with the team is doomed to fail, as making an interesting contribution is far more important than so-called “cultural fit”.

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