Tenet of Innovation #3: Realize that trust is a prerequisite for innovation

Fear kills risk-taking; trust releases it. Part of this principle has roots in the Pygmalion effect (also known as the Rosenthal Effect) I discussed as part of the 10 Tenets of Leadership. Recall that this is a well-studied phenomenon by which our expectations of others drive how they view themselves and hence how they perform. The more faith we have in our employees to be innovative and creative, the more likely it is that they will believe it of themselves and take a chance.

But in addition, the less your people can predict how you will react, the more likely they are to keep their heads down and take fewer risks. Individual contributors and even your management staff must have trust in their top leaders, and leaders must place trust in their organizations in order for innovation to blossom. Without this trust, your people will either self-select out of the organization or become conservative in their approaches. Products and services will seldom push the boundaries of the industry and will more often than not be lukewarm.

Interestingly, unspoken, implied rules or unpredictable responses to results create the greatest fear. Clear rules create boundaries within which innovation can flourish. Unclear boundaries, especially in a setting with a history of erratic responses to breaching these boundaries, can kill an innovative environment. This uncertainty is like walking through a mine field, knowing that any misstep may trigger something underground, and prove to be your undoing.

Although a dictionary defines fidelity as “the quality or state of being faithful; accuracy in details: exactness,” a more appropriate definition of leadership fidelity would be “being faithful to your word, being predictable in your responses to given situations, being true to what you have said you will do.” What people need is fidelity in their leaders, and within this fidelity people can work to maximize their purpose.

In addition, people are most creative and most effective in producing innovation when they are not forced to worry if failure means the loss of a job, a large bonus, or the respect of a leader. According to studies, a big stick or a significant carrot may motivate people to action in some situations (usually rule-based or algorithmic tasks), but it does little to make someone more creative (thinking “out of the box”) and may even hamper judgment. (See, for example, “Large Stakes and Big Mistakes,” by Dan Ariely et al, Review of Economic Studies (2009), 76 (2).) This phenomenon is described in much more detail in the works of Dan Ariely, professor of psychology at Duke University and, more recently, in a wonderful book by Dan Pink called Drive: The Surprising Truth About What Motivates Us. (For a very entertaining 10-minute introduction to the topic, search for “Dan Pink animation” on YouTube.) We are still learning how to develop incentives that will create a truly innovative environment. But, as Pink states, creating an environment where employees can feel autonomy, mastery, and purpose will unleash the power of those who just “want to do something cool” and mainly need your support and for you to get out of the way.

Reward good judgment and allow for mistakes. Innovation is driven by how you react to failure. Leaders need to show trust in their employees and must work to have that trust returned. Only then will you see the burgeoning of innovation in your organization.