Driving Creativity and innovation through leadership

Creativity is Necessary in the Modern Economy

Management is more of an art than science. Companies vary in their managerial culture, and conflicting approaches can be found even in the smallest of organizations. Fostering creativity was not always a dominant part of common managerial practices, but this is changing rapidly. It is safe to say that the importance of creativity is clear to most organizations today. In an ever-changing environment, the ability of organizations to constantly adapt and evolve is paramount to their success.

Common wisdom says that when the going gets tough the tough gets going. The Covid-19 pandemic caused enormous damage to life and businesses all around the globe, but it also accelerated many necessary changes in the way companies work, and even provided an opportunity for companies that were quick to adapt. Thus, the importance of creativity in the workplace grew with the pandemic, both at the individual level and collectively. Before going into the discussion of what I believe builds creativity, I wish to shine a light on the importance of creativity and innovation for the success of companies. My experience teaches me without innovating businesses grow irrelevant and loose ground to competitors, as well as to just natural changes in the market.

You Have Got to Crack a Few Eggs to Make an Omelet

Though mistakes are part of the game, they might also cause harm. Sending the wrong email can lead to losing a deal and using the wrong open-source code component can break your product. By encouraging creativity, subsequently encouraging mistakes, you are exposing your organization to damage. Every person who had the opportunity to manage employees, knows just how hard it is to face mistakes, avoidable perhaps, and costly at times. An error under your supervision weakens your faith in the team and in your own ability to guide and teach. You feel you should have been more active, doubt your judgment, fear the consequences. It then takes great resources to keep course and not diminish the level of independence your team enjoys. It can be inferred that fostering innovation requires good management. This is probably the most obvious and self-explanatory statement, but even the most obvious thing must be said outload at least once.

There are endless ways in which leadership can encourage creativity, and none of them guarantees success. Funny enough, creativity is required just as well to promote creativity. I believe most creativity building practices share a common foundation, which is the understanding that creativity does not come without a price. People make more mistakes when they are given greater discretion. It is up to the leadership to embrace the cost of some mistakes, and to equip team members with the means to make better decisions, rather than making decisions for them.

Let us break down “means to make better decisions”. To me, better decisions does not mean fewer mistakes — mistakes are an integral part of innovation. It is not only that making mistakes is a fact of life we should learn to live with. If that were the case, it would lead to the conclusion that reducing the number of mistakes is a reasonable aspiration on the leadership’s part. My argument is that making mistakes is an integral part of innovation, it builds on the same foundations as creativity and at the same time leads to better outcomes. The history of great achievements is full of mistakes, including penicillin, the implantable pacemaker and x-ray machines. Indeed, Better decisions are decisions made to promote the common goal and serve the stated values. Here lies the key to creativity promoting leadership: each team member act in service of the overall mission and is encouraged to exercise resourcefulness to promote it.

Mistakes that are done in the process of working towards the common goal are the kind of mistakes we should embrace. Mistakes that are done serving personal interest, out of negligence, disrespect to stated values, are unacceptable mistakes.

On the Personal Level: Trust and Confidence

In interpersonal encounters, leadership has plenty of room. Almost every encounter between a manager and one of his/her team members is an opportunity to present an example, motivate, and adjust expectations. Intimate encounters such as one on ones and coffee breaks are a great opportunity to gain ground. Leadership can use these encounters to build confidence among employees and lay the foundations for innovation, by trusting employees and helping them act independently. A manger can use personal conversations to set an example not of how they expect something to be done, but of how he looks at challenges and where goals are set. Employees who know why things are done in the organization, what justifies effort or risk and what not, can allow themselves to be creative.

Another rule I try to follow is to let people interact externally. Customers are indeed the most important thing a startup can have, and the hardest to obtain part of the puzzle. This fact can naturally cause management to be protective of any communication with customers. Though understandable, welcoming employees into customer engagement is important for their personal development, as well as to the innovation in the organization. If employees are exposed to customers’ needs firsthand, they are better positioned to tackle those needs, and to contribute to the team effort by introducing new ideas.

In 2020, at Approve.com, when we started seeing growing adoption of our software among our customers, we decided to add a support ticketing solution and appointment one of the younger team members to reply to inquiries. This team member was not very experienced in customer facing assignments, but he had intimate knowledge of our product and we trusted his ability to provide quality support to users. It was clear that some mistakes in phrasing or context might occur, and still, we decided to trust the process and endure the potential errors.

After a few days, the said employee approached me and presented a full library of short form support articles, with approximately 30 different items, he drafted and posted himself. This was not requested of him and I doubt it if we even knew this was a feature in this support system. Granted, the articles had to be reviewed and adjustments were made. Nonetheless, the outcome was wildly beyond expectations. This support data base became the foundation on which we built our support center, something we did not even plan to build at the time. In hindsight, I feel what drove this employee to execute so well on the task he got, go outside of the mission specifications and create value to the organization, was the confidence he felt in preforming his duties. I think without knowing he is safe even in failing, he would not have achieved this outcome. The lesson I take from this story and many other similar stories I experienced, is that the human mind flourishes on confidence. Management can tell people what to do, or it can inspire them about what can be done.

On the Team Level: Mission Driven Team

When team dynamics slows down, the whole organization gets hurt. Inspiring innovation and ingenuity in a group is a tough task, requiring different skills than what is required in personal interactions. Many business leaders are not fully comfortable in addressing an audience, but in my view, every organization can benefit if at least one senior member of the organization has good performance abilities. Addressing a crowd can be done in many ways, with passion and enthusiasm or with a quiet charisma. But if none of the forms exists, I find that it will be hard to inspire innovation in a team.

Management role, on the team level, is to set clear goals, and rally everybody behind the same objectives. Employees should know what they are trying to achieve, and that if they are contributing to this effort, they are encouraged to act on their own best judgment. In a marketing department, if the current priority is to increase brand reach in Southeast Asia, or to engage in demand harvesting for the first time, or to double content marketing impact, those goals should not be viewed as a group of subtasks realizing in people’s schedule. Those goals can be presented as a new land to be concurred when the whole team is operating the ship together. Every contribution is valued, and value is measured in the mileage gained, rather than tasks preformed.

Epilog

My career so far was spent in small organization. I was the first hire in two ventures and later founded two companies myself, before joining Entrée Capital, a venture capital firm, where I currently work as an investor in tech startups. I learned that startups, rapidly scaling businesses, thrive on innovation more than anything else. I also learned that in order to succeed startup leaders must not only be creative, but also actively encourage creativity in their team members. I try to practice this belief wherever I go.

Entrepreneur (Approve.com) and VC (Entree Capital). Love the startup hustle.