The Innovative CEO: How to Lead Innovation from the Top

What is Oscar Munoz doing walking airline fields in a safety vest? As the new CEO of United Airlines, you may expect him to hole up in a cozy office somewhere, directing the company from behind closed doors. How he'll perform as a CEO for one of the more troubled airlines in operation today is yet to be seen, but right now, he's acting more like a presidential hopeful as he shakes hands and holds conversations with United employees.

What he's doing is gaining the respect of the people he hopes will help him turn the company around: employees at every level. He's showing that effective leadership that spurs change is about opening the lines of communication from top to bottom, not simply instituting a new regime while keeping the same old company culture.

The CEO has a huge amount of power to create change — and innovation happens when that power is wielded intelligently.

Phil McKinney

The CEO, Out of the Loop

While many CEOs have excellent intentions of inspiring their employees to be innovative and creative, putting those intentions into practice takes hard work and truly active leadership. By definition, the CEO has to concern himself with high-level executive functions at the company he’s running. He can’t be involved in every detail of every project in every department, nor should he be. But too often, this position keeps the CEO totally out of the loop of internal communication, and the places in the company where innovation is or should be happening.

Beyond that, a CEO that is completely aloof from all but his most senior employees probably won’t inspire risk-taking when he actually does show up. Everyone wants to please the CEO, and if employees haven’t been presented with evidence to the contrary, they’ll assume they should take the safe route to make sure their jobs are secure. Many brilliant ideas are never voiced because employees lack the confidence to speak up in the presence of the CEO.

In the most extreme cases, where employees shake like leaves when they walk by the CEO in the hallway, innovation is all but squashed. CEOs that rule their employees with an iron fist can expect to get bare-minimum output, criminal mischief, excessive absenteeism, and a lack of communication at all levels in return.

How CEOs Can Lead Innovation

A CEO that wants to lead innovation needs to take a hard look at the company’s structure and culture and decide if those are helping or hurting the mission. With every decision, every policy change, every communication with employees, ask yourself if this will contribute to innovation, or undermine your promises to pursue it. There are several concrete strategies for creating an environment where employees feel free to pursue their ideas, and where innovation is welcomed and fostered rather than left to wither on the vine, that a CEO can help implement.

1. Open the lines of communication. This means speaking to your employees rather than at them or over their heads. Take the time to open the floor to input from those impacted by your decisions. Create convenient, safe ways for employees to voice concerns and raise valid objections to workplace issues. When your employees feel you're on their side and their jobs are safe, they’ll feel more freedom to release those creative ideas and participate in moving the company forward.
2. Create a team to serve as your eyes and ears. CEO fear is ingrained in many people, and that means that many employees are going to clam up when you enter the room, even if you’ve explicitly stated that you want the lines of communication to be open. They're going to turn to coworkers and friendly managers or supervisors with ideas rather than dropping them in your inbox directly. You're going to feel out of the loop if you don't have a trustworthy team serving as a mediator between you and your innovative thinkers. You can conduct efficient meetings with these team members to learn what's happening at all levels within your organization, so you're always in the know. You must have that connection if you hope to offer valuable resources and support as new ideas emerge.
3. Replace criticism with constructive feedback. When meeting with that team, make sure you’re not simply criticizing or putting pressure on managers to get things done faster or meet higher quotas. Instead, consider what you can do to help. Ask what problems they’re facing that you may be able to alleviate using your power as CEO, and offer useful resources. Ask questions that may stimulate creative thought rather than criticizing an idea that falls short of expectations. Remember, innovators will work through many failed ideas before landing on the one that brings in the big rewards. If you're too quick to shut down the bad ideas, your chances of ever getting to the good ones are slim.
4. Stay open to all ideas, even if they threaten the status quo. It’s one thing to talk about encouraging new ideas and innovation, and quite another to actually do it. If an employee questions the effectiveness of the way things currently operate in your company, you can’t simply say “That’s just the way things are.” It may be, but it may not have to be. Does a certain policy inhibit efficiency or change? Are certain power structures crushing creativity? What if an idea demands radical change that is uncomfortable in the short term but revolutionary to your profitability in the future? It can happen, so stay open.
5. Focus on productive leadership in the midst of failure. CEOs that get angry about failure and seek to place blame won’t inspire much creativity in the future. If you take the innovator's perspective, you'll see failure as a step in the direction of growth and success. You'll help analyze what caused it and encourage employees to improve their work rather than being discouraged by the failure.
6. Look your critical eye in the mirror. Even the innovative CEO must evaluate employee performance and make criticisms at times, but you should also turn that critical inspection on your own performance. Understand your natural leadership style, and push yourself to create strengths out of your weaknesses. Just as your employees learn from failure, recognize your own failures and use them as growth opportunities.

Study the many ways that you can stimulate innovation within your workforce, and find ways to step into each of those roles when the timing is appropriate. You become a true leader when you know your employees are following you because they respect the actions you've taken to bring their ideas to fruition rather than because your title is CEO.

The job of a CEO is to define and articulate a company’s mission, but also take an active part in helping the company fulfill that mission. Talking is a large part of a CEO’s job, but talking a big game about innovation can’t take the place of actually leading innovative efforts. The chief executive has a huge amount of power to create change within an organization — and innovation happens when that power is wielded intelligently.

Feel free to contact me for more ideas to help lead innovation at your organization.