Creating a culture of creativity and innovation

Real estate firms need to realign, indeed rethink, their team culture and structure to keep abreast of rapidly evolving marketplace and competitive pressures. I touched on this topic last week on the “Content is King” panel I shared with Mr. Hahn at Inman Connect NYC. I certainly share his sentiments regarding developing a content strategy. But to execute on such a strategy, firms need to delve deeper and essentially conduct a cultural/structural 365 degree analysis, with an overall goal of fostering “innovation” as a cultural norm.

After the panel presentation, I engaged in many conversations about how firms need to “innovate” and how the real estate industry needs to push for more “innovation”. Conversations generally whipped from how to create more innovative products and services, to how to be seen as more innovative by one’s customers, to how to “out-innovate” one’s competition. In my opinion, innovation begins with a culture that fosters unbridled creativity tempered by a disciplined development process–a thesis meeting its antithesis, if you will, to produce a synthesis (i.e., an innovation); similar to Eisenstein’s film theories explored in his books The Film Sense and Film Form.

With respect to innovative culture, the authors in “Climates and Cultures for Innovation and Creativity at Work” define the following factors as hallmarks for innovative firms:

  • High levels of interaction, discussion, and debate
  • Interpersonal and intergroup relations defined by trust, cooperation, and a sense of safety
  • Senior management that’s open to new ideas and improved ways of working, and proves its openness by encouraging such actions and funding them when meritorious
  • The organization is under strong external pressure

Creativity can be defined as

the ability to transcend traditional ideas, rules, patterns, relationships, or the like, and to create meaningful new ideas, forms, methods, interpretations, etc.; originality, progressiveness, or imagination – creativity. Unabridged (v 1.1). Random House, Inc. (accessed: January 14, 2009).

Professor Jonathan Feinstein of Yale studies Creativity and has developed a great web-based resource on this topic.

I posit that fostering creativity is essential to competitive advantage. This thesis states that creativity is essential to the production of knowledge and its exploitation, and argues firms should create a creative knowledge environment (CKE). A CKE has the following salient attributes: clear objectives, positive group climate, active group participation, relatively flat hierarchical system, adequate resources, keen hiring decisions, engaged and visionary leadership; this definition aligns with the creative culture attributes outlined above. Both studies essentially conclude that such culture is essential to fostering innovation.

But once this culture produces an innovative thought, what framework induces it’s ultimate productization and monetization? It’s at this point where ultimate success or failure is determined. If such creative or innovative thoughts are always–or 80% of always–run through a control committee comprised of a “team” of senior managers, marketing types, IT types, and accounting types, chances are the innovative thought is squashed like an annoying bug as each “team member” sifts through respective intra-firm turf battles, alliances, resource jealousies, and personal fiefdom integrity and longevity issues. Countering this drying-like-cement-slow-death-approval-process, the set of authors above imply in their research that by hiring capable people who are naturally inclined to think through issues from all angles, management can relax a bit and “trust” their employee team to make the right decisions and manage the process themselves, which naturally leads to a culture of creativity and innovation. Peter Drucker touched on these themes and concepts. This is not to say that these “knowledge workers” should run amok, which is where disciplined development processes come into play.

There still needs to be strict adherence to processes that bring innovative products and services to market for the ultimate benefit of consumers. And in my opinion these processes are based on iterative design principles, or rapid application design principles, layered over agile stage-gate approval processes. Real estate firms that are hindered by stilted and overly obtuse ideation and development processes will suffer in the coming years; that is, firms that over analyze every move (or 80% of every move), allow poisonous turf battles between Marketing and IT to continue, and feel that nothing should be released to the public unless its “perfect” will suffer in the coming years. On the other hand, firms that realize that iterative design principles coupled with sound expected valuation analyses yielding rapid deployment and testing of prototype products (be they widgets, new website UI design, whatever) will benefit from the wisdom of crowds (see my earlier post on crowdsourcing) and release products and services that meet–and exceed–consumer needs and desires; which I’d say is innovative in its own right.

10 thoughts on “Creating a culture of creativity and innovation”

  1. Excellent post on customer loyalty, backend marketing, and recurring billing.
    These are all the best ways to generate a solid business model.
    Long term reccuring customers are where the money is at.
    If you treat and market your loyal customers
    with incentive programs,sales incentives,
    and customer loyalty programs,
    you will be setting yourself up for
    long term success based on proven business principles.

  2. Any organization can learn from Pixar’s “transparent” organization. Transparency in business innovation refers to removing all barriers to information, rules, data and people. It also means that nearly all decision making is carried out publicly. President Ed Catmull explains Pixar’s daily review process: “people show work in an incomplete state to the whole animation crew, and although the director makes decisions, everyone is encouraged to comment.” Decisions are not made behind the scenes by the “brain trust.” If you have to refer to an organizational chart to get permission to talk to someone, you do not have transparency. Remove the barriers to information and communication in your organization, and you’ll unleash the creativity!

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