Research Shows Company Leaders Are Stifling Innovation

Don Tennant
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Here's the bad news: When it comes to inspiring and leading innovation, company leaders think they're doing a much better job of it than their employees think they're doing. Here's the good news: Leaders in the IT/telecommunications sector are a lot better at fostering innovation than their counterparts in other industries.


Development Dimensions International, a global talent management services provider based in Bridgeville, Pa., recently released its findings from a survey that aimed to determine how company leaders and employees view innovation in their organizations. The survey found that most employees don't see their bosses as being open to unique ideas or opinions, and one-third of them believe their ideas will be killed by organizational bureaucracy. Here's an encapsulation of the seven key findings:


  • Industry differences highlight market trends and the importance of a differentiated view of innovation challenges. Our leader-level study participants ranged across nine industries with enough individuals to reliably examine differences: business/professional services, construction/engineering, financial services, health care, IT/telecommunications, manufacturing, media, public sector, and retail/wholesale. Across all innovation-fostering behaviors, leaders in the IT/telecommunications and media industries were strongest, averaging agreement rates about behaviors targeting innovation challenges of 76 percent and 78 percent, respectively. While innovation permeates most industries to a degree, the fluid and constantly-evolving nature of these two in particular make it unsurprising that they are the industries with the most prevalent rates of leaders driving innovation. At the other end of the spectrum were public sector and business/professional services.
  • Leaders are not actively engaged nor are they personally invested in driving innovation. When we look at individual leader behaviors-as reported by the leaders themselves-regardless of the challenges they target, five rose to the top of the list of most frequently performed behaviors targeting innovation, all with agreement rates over 75 percent. The high agreement ratings of these behaviors illustrate that leaders do accept and encourage their teams' innovation efforts. These are unquestionably positive and valuable behaviors on the part of leaders. However, they are relatively passive, not requiring a leader to take a personal risk or confront the status quo. In contrast, when we turn to the five least frequently performed behaviors, they are more dynamic and active behaviors-those which demand a leader's personal attention and require him or her to challenge organizational paradigms.
  • Leaders think they exhibit behaviors associated with driving innovation far more frequently than employees think leaders do. Surveying both leaders and employees allowed us to pinpoint the gaps that existed between these two groups. Those differences turned out to be both pervasive and concerning, yet they also reveal how leaders can focus and advance their innovation-generating skills, and how organizations can accelerate leaders' efforts. To look at this issue broadly, we grouped the 20 leader behaviors into the four challenges they address-Inspire Curiosity, Challenge Current Perspectives, Create Freedom, and Drive Discipline. On every set of leader behaviors linked to innovation challenges, leaders reported agreement ratings considerably higher than employees who rated their own leaders.
  • Leader actions to foster employee innovation will likely fail without an organization-wide commitment to innovation. Leaders need to be innovative, but much of the onus for driving innovation lies with the organizations for which they work. So what is the role of the organization's culture of innovation (or lack thereof)? The short answer: The stronger the culture of innovation is, the more both leaders and their teams will report that innovation behaviors are demonstrated.
  • The more senior the leaders, the more they create the conditions for innovation. Based on leader perspectives on their own behaviors, differences between senior and first-level leaders were sizable, with senior-level leaders exhibiting much higher agreement rates for all challenges. Although there was a clear linear trend from level to level, differences between senior- and mid-level leaders, and between mid- to first-level leaders, were smaller and not statistically meaningful. While higher-level leaders may in fact perform more innovation-building behaviors, this finding may also highlight the impact and criticality of leader autonomy and scope of influence. First-level leaders may simply not have the power to notably drive employee innovation. Higher-level leaders may also have more resource control given that they are more likely to be in positions where they are responsible and accountable for driving innovation across wide spans of the organization. As first-level leader ranks have thinned, they may also be consumed by day-to-day job activities and tasks. Pursuing innovation may come with risks they don't care to take, or have the time to.
  • There are no significant differences in innovation-fostering behaviors across age or gender. The large and diverse participant group in this study allowed us to diagnose whether certain groups were more inclined than others to demonstrate innovation-related behaviors. Some of the stereotypes or assumptions we were able to examine include: Younger leaders are more willing to take risks; younger employees have higher expectations of their leaders, which could result in lower ratings of leaders' innovation-fostering behaviors; and female leaders are more risk-averse than their male counterparts, and thus less likely to compel innovation. The reality? None of these stereotypes or assumptions is borne out in our results. Only minute differences existed when comparing male and female leaders, and when factors such as leader level were controlled for, the differences disappeared completely. We also looked at variation between age groups to detect any behavioral differences-and again, we found no clear trend by age group. Rather, innovation-fostering behaviors were evenly distributed across leaders regardless of age.
  • Who killed innovation? When identifying the perpetrator, leaders are less likely to look in the mirror. A leader's negative impact on employee innovation-by destroying or starving it-can be extremely damaging to an organization's pursuit of innovation as a strategic goal. As the first reviewers of ideas generated by individual employees, leaders are the make-or-break deciders on what ideas are pursued, and which ones are not. From the perspective of an employee who has taken the personal initiative and risk to develop and propose a radical idea, poor leader openness can severely inhibit innovation motivation-possibly permanently-to the company's detriment. While this effect is relevant for leaders of any level, the scope of a leader's poisoning influence on employee innovation grows as he or she climbs the organizational hierarchy.

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