What Most CEOs Get Wrong About Innovation

Too many bosses unintentionally discourage the best ideas from coming forward. Thankfully, there's a better way

Written by PROFIT Staff

In 2016, there are few buzzwords in business as ubiquitous as “innovation.” Yet while most CEOs are quick to trumpet the innovation of their workforce, many are actually holding their people back—at least, according to Mitch Fairrais, founder and president of Toronto-headquartered On The Mark, The Learning Experience Company.

In advance of his upcoming workshop in Toronto, PROFIT talked to Fairrais about the most common mistake business leaders make when trying to build innovative companies, and the simple change they can make to improve the process dramatically.

PROFITguide: How do you define a “culture of innovation”?

Mitch Fairrais: Pretty simply: It’s the ability to do things differently to be able to get a different level of results than most organizations have experienced. It really is that ability to look at the current reality and not only envision new possibilities, but to be able to execute. So many people get caught up in innovation in the ideation phase. We look at it as an ongoing process from identification, to investigation, to ideation, to looking at how ideas can have impact. And then, ultimately, it’s about the ability to implement.

So much of the world of innovation, and the gurus who talk about it, they’re really good at looking at how to bring about models for ideation and so forth, but what there isn’t a lot of out there is how to take innovation and make it implementable, something you can execute on. Companies at various levels can be very good at the ideation piece. But to actually make a change that has ongoing or significant benefits to organization is very challenging for most.

Why do you think so many leaders struggle to see new ideas through?

There’s a misconception that innovation happens when someone’s working at their desk, and suddenly the lightning bolt hits them and they have this grand idea. We know from experience that most innovation is iterative in nature; in most organizations, it comes from what I call “idea-on-idea.” So you have an idea, and I say, “Maybe not like that, but what if we turn that on its side?” And someone else says to us, “Well, what if we took that and swung it way over this way?” That kind of thinking yields the best results at all stages in the innovation process, from ideation to execution.

So one of the things it’s incumbent upon leaders is to cultivate environments in which idea-on-idea can happen. That is counterintuitive for most leaders. Instead, what happens is that someone will come up with an idea, and a very typical response for a leader might be something dismissive, like: “We tried that 2011; that didn’t work.” And at that moment something bigger is at play than most senior leaders understand.

How so?

Technically, the leader may be correct; the idea being suggested may not have worked in the past. But this kind of response kills idea-on-idea. When someone’s ideas are shot down—especially if it comes from a senior leader—they’ll be more careful the next time they put an idea forward. They’ll wait until they have something perfect to present. Over time, they’ll grow more hesitant to put ideas forward quickly, and that slows the entire process down.

By responding this way, leaders are absolutely killing the source of innovation in their organizations, and most have no idea they’re doing it.

Most CEOs would probably view rejecting mediocre ideas as their job—not something that’s stifling their innovation.

Day in and day out, I sit with the senior teams and I watch them poke holes in ideas and shut people down. They are good-hearted and well-intentioned; they are trying to guide their people against making mistakes. But in the process they eliminate the need for failure that gets us to success. Innovation is at some level about giving your people some latitude to fail and having leadership teams getting comfortable with the concept of failing.

What can leaders do to be more supportive of the innovation process?

I would almost suggest adopting the mindset that there’s no such thing as a bad idea, in that each idea is a potential seedling for the next idea that we can build off of.

Now, of course we’ve all seen tons of ideas that really are bad. But if it helps to remember that your job as a senior leader is to create a flow of ideas. So, that means responding to ideas in an additive fashion as opposed to poking holes and stopping people from putting ideas forward. It also means gently responding to bad ideas before they reach culmination, but doing it in a way that still encourages the next idea to come forward. It’s a reframing of the concept of “a bad idea.” And that’s what allows innovation to flow.

Mitch Fairrais is presenting a workshop on April 21 in Toronto as part of the 2016 GREAT CEOs Speaker Series, which also features Horst Schulze and Tom Peters.


What’s your innovation philosophy? How do you come up with great ideas and bring them to life? Share your thoughts and strategies by commenting below.

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