Building a Culture of Innovation in the Workplace

Companies with an innovation culture have identifiable characteristics that support creativity and experimentation. But what is a culture of innovation in an organization, and how can it drive improvements on a company-wide level? Here’s what you need to know.

What Is an Innovation Culture?

As Steve Suarez, Global Head of Innovation, Global Functions at HSBC, said at a recent Emeritus digital event, “Innovation is not a spectator sport.” Giving everybody in an organization an opportunity to innovate increases engagement in the process, says Suarez, a seasoned professional with decades of management experience in business. 

A culture of innovation can be defined as an environment that supports creative thinking and experimentation to generate improvements in products, services, or processes. Companies looking to develop a culture of innovation need to provide the right tools, resources, and atmosphere to foster original thinking.

The main features of a culture of innovation include:

  • A supportive working environment
  • Individual ownership and hard work
  • A chance to foster that “entrepreneurial itch” that drives curiosity

To Drive Innovation, You Have to Fail

Innovation involves risk; you need to experiment and try new ideas to find inventive solutions to problems. Employees need to feel comfortable trying and failing and then learning from their failures. 

In a work environment that condemns failure, employees cannot innovate effectively. Rather, your workforce needs to confront failure, while still getting the job done. A culture that supports learning and continuous growth is a more fertile ground for employees to take risks. 

A closed mindset where information equals power can squelch innovation because workers are unwilling to share knowledge. This makes collaboration impossible–but collaboration is crucial for innovation. In contrast, creating an open information-sharing environment encourages a mindset for experimentation. 

A culture of innovation needs to reward open exchange and knowledge sharing; it means celebrating failures for what they teach your workforce. When projects succeed, they can inspire others to take risks. Rewarding success and communicating the process and results to the broader company can help encourage others to try innovating.

Speed and Ease Support New Ideas

Innovation culture should allow for innovation to be cheap, fast, and frictionless. With fewer barriers to developing ideas and pathways to test proofs-of-concept (POCs), the rate of innovation can increase. 

With a growth mindset in the workplace and the facility to innovate, individual employees and teams will have what they need for innovation. You can further facilitate an innovation culture with employee access to data sets, sandbox environments to test ideas without disrupting operations, and the other supplies, equipment, information, or people resources needed to quickly and cheaply test ideas. 

Rapid experimentation in low-cost pilot programs decreases the cost of failure, encouraging innovation.

Leveraging the Power of Size in a Culture of Innovation

In a large organization like HSBC (where Suarez leads global innovation), with around 230,000 employees, size can be an advantage rather than a hindrance to innovation. 

Often, we think of large organizations as too encumbered and stuck to innovate. Still, in the work of HSBC, the sheer number of ideas generated helps employees discover new solutions. HSBC has an extensive database to manage all innovation ideas gathered from teams worldwide, allowing employees to explore similarities in their problems or see that an idea has already been tried but failed. Managing the volume of initiatives and experiments is key to avoiding confusion or duplicated effort. 

“If the majority of your ideas succeed, you are not really innovating,” Suarez says. He estimates 90% of POCs fail, but the 10% that succeed can create huge gains for the organization when implemented. With such a large pool of experiments, that 10% is a sizable amount of change. Plus, each experiment may add enormous value to operations.

Innovation culture examples are all around us in the many ways businesses try new initiatives that improve customer experience, productivity, or even produce new products. In one instance that Suarez cited, a team reduced the manual process of creating a report that took four hours to just 15 minutes by using the power of the cloud. That type of impact can tremendously change business models, operations, and lower risk. 

Even failed POCs can have a positive impact when the information you gain can apply to other parts of the organization.

Continuous Learning as a Foundation for a Culture of Innovation

In Suarez’s experience, staying curious has allowed him to move through his career with new opportunities and renewed inspiration. When needed, he has sought out learning experiences with experts to explore different topics most efficiently. 

Continuous learning environments help organizations attract and retain talent. Employees at all levels can take advantage of these opportunities. There’s power in rewarding and recognizing behavior that can help encourage more employees to consider taking risks, including through learning experiences.

More than 250,000 learners have taken Emeritus courses. Within this group, 17 years is the average length of work experience. This demonstrates that many senior workers see the value of upskilling to stay current and learn new tools–and ultimately improve outcomes in their organizations.

A Portfolio of Innovation Projects

Innovations need to provide value to an organization. And by demonstrating value, leaders can procure new partnerships and funding.

Suarez suggests having a portfolio of projects in three horizons when it’s difficult to convince others of the importance of innovation. 

  • Horizon 1 projects may be smaller but can prove their worth very quickly. 
  • Next, Horizon 2 projects will take about a year to show value.
  • Finally, Horizon 3 projects can lead to gains in two to five years. 

Having smaller initiatives that quickly impact the organization can help change leaders demonstrate value in action.

As Canadian Prime Minister Justin Trudeau said in a speech at Davos World Economic Forum in 2018, “The pace of change has never been this fast, but it will never be this slow again.” Managing change and laying the foundations for an innovation culture requires an environment where continuous learning is encouraged, recognized, and rewarded. Learning experiences made available to employees can play a positive role in a culture of innovation in any organization.

By Julia Tell


Learn more about Emeritus Enterprise can help you build a culture of innovation in your organization by developing online employee training programs. You can also watch a recording our recent digital event on this topic featuring insights from Suarez.

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