How to Create a Successful Culture of Innovation: Part 1

Creating a successful culture of innovation is crucial for business success. Factors that contribute to an innovative culture include values, beliefs, norms, and attitudes of employees. Organizational culture is difficult to change because it is deeply ingrained and self-reinforcing. Simply hiring new people won't necessarily change the culture. Formal efforts like memos and training classes are less effective in driving cultural change. Research suggests that changes in behavior, particularly by senior management, are key to altering organizational culture. The confidence employees have in senior management is a differentiator between great and not-so-great cultures. Stay tuned for the next blog post on how to create an innovative culture.

By now, if you don’t know now that having an innovative culture is a major thing in business and management, you have some serious catching up to do…

Building an innovative culture is a major driving force in businesses being successful. There are countless examples of successful companies enjoying massive benefits from such a culture; the most prominent being Google, Amazon, and Netflix.

For many, culture tends to be a fluffy abstraction; in a series of three blog posts, we’ll explore:

The concept of culture in organizations;
the actions you can take to change it, and;
lastly, examples of organizations turned their culture on its head.

Today, we’ll dive into what ingredients go into the pot when cooking up a new, delicious organizational culture. What’s more, we’ll review these factors in the light of creating and sustaining innovation – so stick around…

Significant Cultural Factors

Scholars and practitioners have been bickering for what seems like forever on which factors are significant to the success of an innovative culture. A big part of this never-ending wrangle is the fuzzy nature of culture. While we might never arrive at the final answer, we’ll give you an impression of the most accepted and discussed factors.

What is Culture?

Let’s start by looking at common definitions of culture and organizational culture so we are all on the same page.

Culture has multiple meanings, just to be clear, the definition we are looking for is not related to bacterial cultures. With that out of the way, let’s look into the definition of organizational culture

Business+Startegy employs this short and sweet definition: “Culture is the self-sustaining pattern of behavior that determines how things are done”. However, this still leaves the question of WHAT makes up culture. With a few variations, there is general consent that it is the sum of values, beliefs, norms, and attitudes of a company’s employees. As such, each new employee adds a new dimension to the organizational culture, making your culture anything but static. Rather consider it a living and breathing organism.

That being said, researchers have also found organizational culture to be highly path-dependent and difficult to change. Culture is both spoken culture, i.e. what is worded by managers to employees, and the much more significant action-based culture. In other words, if the execs are not only talking the talk but also walking the walk.

But why is this relevant, you might ask…

Well, by understanding what organizational culture consists of, you also get a better understanding of why it is so darn hard to change…

employee innovation culture — An organization’s culture is the sum of its employees actions

Why is culture so hard to change?

We now know that cultural factors are fuzzy and hard to grasp, which is why it’s so difficult to change. Moreover, often culture is built over decades while it self-reinforces in the organization’s best-practices and codes of conduct making it hard to break.

While newcomers add diversity to the organizational culture, at some point they are engulfed in the culture themselves, also known as assimilation. So the answer to changing an organizational culture is not simply hiring more new and different people. In fact, this is much more likely to end up in a messy and distorted culture.

Formal efforts to change up an organizational culture, such as memos, inspiring banners, and diversity training classes are less effective in encouraging cultural change. People will delete the emails, not notice the banners and roll their eyes at your diversity coach.

A textbook example of ways in which this could go wrong is Enron, who despite proclaimed values of excellence, respect, integrity, and communication had accounting fraud and scandals as part of their everyday lives. Maybe they should have thought of this before engraving their values into the marble floors of their Houston HQs…

Research points to changes in behavior to alter an organization culture, needless to say, managers and executives here play an important part. Some point to managers as role models, stating that peoples’ need to belong leads to people copying people, especially when that person is a high-rank member of the organization.

In fact, a 2015 study, found that the greatest differentiator between great cultures and not-so-great cultures is the employee confidence in senior management. In this lies management’s ability to communicate strategy, direction, goals, and expectations, reflected in these managers’ own behavior and conduct.

Stay Tuned

So culture is a fuzzy thing that can mostly be altered through the behavior of senior management. But what on Earth does this has to do with you creating an innovative culture in your own organization? Keep an eye out for our next blog post: How to found a successful culture of innovation: Part 2. Here we’ll tackle just that question. Meanwhile, why not check out our post on why you need a Cheif Innovation Officer?

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