How Leaders Create the Conditions for Innovative Thinking

Legal teams face more data and more scrutiny than ever. They need AI built for both. Relativity is the AI platform for legal work, delivering defensible AI that handles the tedious tasks so judgment stays where it belongs, with you. Learn more at relativity.com slash HBR. Welcome to HBR on Leadership. I'm HBR Executive Editor, Alison Beard. On this show, we share case studies and conversations with the world's top business and management experts, hand-selected to help you unlock the best in those around you. We carefully curate this feed from across the HBR portfolio, aiming to help you unlock your next level of leadership. I hope you enjoy the episode. I'm Adi Ignatius. I'm Alison Beard, and this is the HBR IdeaCast. All right, Alison, so every organization wants to innovate, right? Not just once, but over and over again. And judging from the conversations I have with CEOs, most feel they cannot accomplish this, right? They look inward. They wonder, am I smart enough? Am I clever enough? Can I compete with genius founders? When actually, it's not so much about individual brilliance, but about creating an environment where good ideas can be surfaced and tested and ultimately put into action. Yeah, I think we know from research that a lot of the best innovation comes from the front lines as well as R&D departments. But then how do you harness those ideas, create effective experiments, and ultimately scale the ones that work? And if you're a leader, how are you overseeing all of these disparate efforts and then prioritizing the ones in which you really want to invest? So today's guest has been drawing the playbook for innovation for much of her career. Linda Hill, professor at Harvard Business School, wrote the book Collective Genius about a decade ago and has just published a new one, Genius at Scale, How Great Leaders Drive Innovation. She's going to explain how to create a system and build a team that can innovate and then cascade the new thinking throughout the enterprise. Here's our conversation. So you've written a book about innovation. You know, I would say this is a time when some leaders are in survival mode. A lot are uncertain about AI. How should leaders be thinking about innovation right now? I think innovation is really an imperative and it is about survival. It is not about, you know, anything extra because nowadays we have to be able to adapt and respond to whatever is happening out there in the world and it's a very uncertain world. Talk a little bit about the misconceptions surrounding innovation because I feel you've been spending much of your career trying to deflate some myths about how innovation happens. Well, this is the second book we've written about innovation. The first one was called Collective Genius. And there we tried to understand what do leaders do that create organizations that can innovate time and again. And one of the things that surprised us is leading innovation is not about having a vision and telling people, follow me to the future. Instead, it's about creating the right culture and capabilities to get people to want to co-create that future with you. So leadership is not about followership when it's about innovation. It's about co-creation and that requires a different mindset, different behaviors, and a different skill set. After we finished that work, we then began to understand and spend more time looking at organizations and what were they finding most difficult about really innovating. And particularly now with emerging technologies, how do you get people to adopt these technologies to create value as well as, you know, how do you create an organization that can innovate time and again? So we ended up focusing on what people told us was their problem. Maybe we can come up with innovative solutions, but we can't scale them. They never become reality. We really focused in on how do you scale these innovations? And that means really building not only organizations that can co-create, but also partnerships and sometimes whole ecosystems able to co-create. So if genius requires a collective approach, are most companies even set up to deliver on that? Genius does require more collaborative approaches or collective approaches, and most organizations are not. There are three pieces to the puzzle of what you need to do to innovate. You have to be able to collaborate, which is really about dealing with difference. You have to be able to experiment and learn, and you want to be able to do that in a pretty efficient kind of way because you cannot plan your way to an innovation. You can only act your way to one. So I think that's the other myth, that we can plan it all out, but no, that's not what you're trying to do. You are trying to create some discipline. So if you look at any single innovation, I suppose you might find, you know, an individual genius can have an aha moment. But we're really interested in building organizations that can innovate routinely, making innovation a capability in your organization, not something that you happen upon and you do right once. So it sounds like that's partly about process, partly about the skills at the top. What does leadership need to look like to deliver on that? All of the leaders we have studied, and we've studied a lot all around the world, different industries, government, not-for-profits, all of the leaders we have studied have been visionaries. But one of the things we know about visionaries is, can visionaries make space for other people? Sometimes they can take up, if you will, the whole room. So they figure out how to behave, how to carry themselves, how to create the space where people will be able to work with them. So one of the conversations I just had with a CEO who's very visionary, he said that he had to learn how, frankly, to be quiet, to be patient when he's very urgent. He's got lots of solutions and lots of things he wants to say. So he literally ended up saying to his organization and to his team, I'm not going to speak anymore for the first 20 minutes because he needed to manage himself in a different way if he wanted people to be willing to share what we refer to as their slices of genius. Too often, we don't use the talents and passions of the people who are around us. And we can't afford not to use them given the nature of the challenges and opportunities we're trying to address today. All right, well, let's talk about how to extract that because I feel like companies frequently say, we need to reach out to the leadership team or maybe the entire employee base because the good ideas are going to come from there, are going to come from the people maybe who are on the front lines. But they have trouble actually eliciting these good ideas that should be there. So how do you do that? How do you get the good ideas? First, I have to feel like it's worth it for me to share my ideas, to share my slice of genius with you. So what are the conditions you create that I am actually going to feel like I want to do that because innovation is hard work? It's emotionally and intellectually difficult work. So you as a leader have to create the space where people feel willing and able to do that work. It's not surprising to me that there's so much attention paid to purpose, the purpose of the organization, because people want their work to be meaningful. Why should I take risks trying to work through a conflict with someone who's a very different point of view of mine, has a very different point of view than me? Or in fact, you know, we're going to experiment and learn and we're going to have missteps and failures. Why should I do that unless the work is meaningful? So one of the most important things for a leader to do is to create that sense of purpose, a shared sense of purpose. The other part of it, though, is making sure that the people I'm going to be working with are people that I fundamentally trust. So what really you see these leaders do is they think about building the social environment, the social connections amongst people so they'll be willing to take on this meaningful work that is going to be hard work. And if I think I can trust you, I'm much more prone to want to do this kind of work with you than if I don't think I can trust you. And one of the things that's very important about whether I trust you is also whether I think I can influence you and that you actually respect that I have something to offer. Now, that may seem like very obvious stuff, but you talk to many people in organizations, they don't feel valued. They don't feel valuable. They don't necessarily feel that they can have influence. So let's say listeners are persuaded. You know, how do you learn that skill? If you don't have it naturally, that skill of listening, empowering, staying quiet, as your example from earlier, how do you learn that? Well, what I see is that one of the leaders we studied, he's a Rhodes Scholar. He's a brilliant surgeon. He's a pioneer in robotics. One of the things that he did is he got a sparring partner. He found someone, his CEO, he found someone who had a very different sort of point of view about the world. He's an optimist. His other person's a pessimist. He's big picture. That other person's more detailed. And he became a sparring partner. And he actually sought this individual out to give him feedback to see if his intent was matching his impact. And when it wasn't, you know, that sparring partner, even though he was reporting to this CEO, said to him, no, your impact wasn't what it needed to be in that particular instance. When this particular leader also had to learn, how do I actually lead virtually? How do I do this, you know, when I'm looking through a camera? He hired a coach. He moved his space this way, that way, moved his hands certain ways, asked the coach, how are you perceiving me? So it's very difficult to figure out how you're perceived if, in fact, you don't have feedback because leadership is always about an emotional connection. In moving the culture and developing these innovative solutions, what Ajay did is select leaders who knew how to sort of be the bridge between tech and business, you know, if you will, the future and the present, so that actually these solutions got scaled. So that's, I think, what's really a critical part of that story. So the takeaways are having a sense of purpose, driving strategy based on that kind of true north, changing out the top leadership to make sure everyone's aligned and make sure you have some of these skills you just talked about. You know, a bit of genius maybe in Ajay's ability to kind of put his finger on the vision that they needed. The one that I would just pull out a little bit more is in Genius at Scale, we talk about three interrelated leadership roles. The first one is you do need to architect the organization to be able to innovate time and again, and Ajay worked on that a lot. The other is you need leaders who know how to bridge, who know how to work across organizational boundaries and also, I mean, literally find partners even outside the organization to help them bring in the talent and capabilities they need. So these bridgers are really critical. And then the last role that we talk about in the book is the catalyst role. These are the leaders who actually know how to create what we refer to as movements across whole ecosystems to get some innovation done. So if you actually get those architects in place, that's good, but to move at the pace you need to move today, particularly with technology, you need these bridgers. So I've been talking to lots of C-suite executives, and what they tell me is we don't have enough people in our organization who know how to bridge between the tech side and the business side. That's the way they put it. We just don't have people who know how to do co-creation across tech and business. And that shortage is slowing us down. So I think what we also need are these leaders who understand about co-creation across organizational boundaries or even across, like with electric vehicles, whole ecosystems that need to be put in place to support electric vehicles really becoming something that, you know, many of us are willing to buy and enjoy. Legal teams are under more pressure than ever. More data, more complexity, more scrutiny. They need AI built for the realities of legal work. For more than a decade, Relativity has invested in AI built specifically for legal teams, designed to meet legal standards and support defensible decisions. The result is explainable AI that handles tedious tasks so judgment and critical decisions stay where they belong, with you. Learn more at relativity.com slash hbr. So I would have thought that the catalysts, the bridgers, that that happens organically, but it sounds like you're saying, no, you actually have to be very purposeful about, if it doesn't happen organically, that you have to create the structure where these roles will be in play. Think about it, Adi. Too many organizations are siloed, even to this day. And when you ask anyone, what is it going to take for you to make sure that these investments you're making in Gen AI and agentic AI are really going to pay off? They all say, almost immediately, horizontal work, right? But we still haven't learned how to work horizontally within our organizations, nonetheless, with others outside our organizations who have different priorities, different constraints, different working styles. So what you see in the Ajay Banga story is how they learn to work with startups to learn and bring them in to give them talent and capabilities. Then they learn how to build even a broader ecosystem where they bring their clients to work with these startups and they facilitate those relationships to create different kinds of, I'll call them coalitions necessary to get change done if you want to start doing business in a country you've never done business in before. So I think that those leaders who can have that big picture and think about, you know, you can't do this all. You need lots of bridgers. You need lots of catalysts. I think that that's what we're seeing is new and it has to do in part with the speed of the emergence of new technologies, as well as people have become very aware, maybe partly because of the pandemic. I don't know, or the political issues going on, that you need to think about creating an environment, a broader ecosystem in which your organization is working so you can be successful. So that's what we see. It's just, it's become tougher. So another example from your book, a fun one, you write about Osteria Francescana, the Italian restaurant that has twice been named the best restaurant in the world. What are some lessons that the rest of us can draw from their success? Massimo and Laura, who are the couple who have created this whole global network of both Michelin-rated restaurants as well as soup kitchens called Food for Soul. And they see these as very interconnected because for them, being in the restaurant business is about what they call the slow food, fast car movement. That is embracing tradition, but also innovating. So one of the things that they really worry about is how do they develop chefs who have their own identity? So none of his restaurants are named after Massimo, you know, all of them have their own names and actually are restaurants that really suit the local environment. And so, you know, if I'm going to Tokyo, I need to be a chef. I'll work for a while in Modena at the main restaurant, but then I'm going to go off to Tokyo and I'm going to create a restaurant there that reflects on what I've learned from Massimo and Laura, not only about, you know, the food and how you do restaurants, how you create a really world-class restaurant, but also how do you get to know the community and figure out how you can serve the needs of that community, help with the unhoused. So whenever a chef goes into whatever city, location they go into, they actually have this sensibility about, we want to become a part of this community. And part of that is making sure that we source local food, we source locally and develop relationships with the suppliers in a particular region, but it's also about understanding what the needs are of that community and figuring out how we can serve those needs. So they develop chefs who are really values-driven chefs about all that they do. And that shows up in all of the work. You talk generally about great leaders as being wayfinders and not pathfinders. I like that distinction, but talk about what that means to you. Well, I have to tell you, whenever you are writing the epilogue of a book, by that time as an author, you are tired. And we wrote that epilogue over I don't know how many times. Probably our poor editor wanted to kill us. Just couldn't get it right. And one day I was reading about explorers, the explorers that discovered America or the continent, whatever. And it struck me that one of the problems we're facing right now is all of us are searching for leaders who can help us find the path. We need vision, let me be clear. And if you have vision and you know the vision, then go ahead, tell people that vision, get them to follow you. But nowadays, many leaders don't have vision. They know the problems and the challenges, but they don't have a vision. So what I realized in reading this about these explorers were, you know what we need is we need wayfinders, not pathfinders. People who know how to use whatever tools they have, you know, back in the day, I guess it was the currents and the moon and the, you know, the stars and all of that. And now we have Gen AI, we have all these other more sophisticated tools, but we still need people who have the courage and some sense of their values or purpose to help them navigate, who can help the rest of us find our way, I guess is experiment and learn our way to where we want to be. So I keep asking about, you know, how can leaders take us to the future? And for me, it's like, no, not they're not going to take us to the future. How can they help us shape the future that we all want? And that is more co-creation than take us to the future because anybody that tells you they know what the future looks like, they don't. There's just too much going on to figure that out. So what specific advice would you give to a C-suite leader who feels the innovation pipeline is stalled? They want to do the right thing. They want to be a wayfinder. They don't know how to fix things. What advice would you give? I think I would start by really assessing what do you think, and this may not be the kind of answer you want, but what is the culture of your organization? What are the capabilities? Be honest about that and think about this is not going to be fixed fast. These are not fast fixes, but I think leaders need to really first do an assessment of, you know, what is our culture? What about our culture actually facilitates innovation or what are the barriers? And then I really do think it's about looking at the capabilities of the organization. And we know there are certain muscles that have to be there. The muscle to collaborate, which we refer to as creative abrasion, the muscle to experiment and learn, which we refer to as creative agility. Can you actually do that kind of experimentation and learning again efficiently? And then this muscle of how to make decisions, creative resolution. So I think that I would start by sort of doing an assessment of, you know, what is our culture? What about our culture actually facilitates innovation or what are the barriers? And then I really do think it's about looking at the capabilities of the organization. And we know there are certain muscles that have to be there. The muscle to collaborate, which we refer to as creative abrasion