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Researchers such as Harvard University’s Teresa Amabile explained that employee autonomy is one of the most deciding factors affecting their creativity. “People will be more creative… if you give them freedom to decide how to climb a particular mountain,” she wrote in her 1998 article How to Kill Creativity.

But having a strong creative idea flow is not enough. Innovative companies are willing to take risk with radical and highly unorthodox ideas, and are willing to place bets even with less-than-perfect odds of success.

And how are these two related to fear? It’s simple. Two years ago, to illustrate this point, I asked someone I had just met in a chamber of commerce reception in Houston if he would give me the keys to his brand new Mercedes E-class so I can test drive it. He looked at me, somewhat annoyed, and said “no!” “Why?” I asked, and he replied: “because I don’t know you, and I don’t trust you with my car!” Makes sense. Letting me drive his car is a risk that he had no reason to take. “Let me change the scenario a bit,” I added: “what if you were hurt, needing to be taken to a hospital, and this is really not where you want to leave your car parked overnight. Would you give me the keys and let me drive it to your home then?” He didn’t think twice and immediately said “of course!” “How is that different?” I pressed. He had to think about that for a moment, realizing he gave me two opposite answers to the same question in less than a minute. He finally replied, triumphantly: “Because I didn’t have a choice this time!”

Companies “think” and act the same way. When the company’s status, financials, and prospects are positive, protected, and safe (or, at least, are perceived to be so), it doesn’t take risks. It doesn’t have to trust employees enough to let them make mistakes, and it doesn’t have to apply resources to crazy ideas. However, when the company is fearful for its survival, when it is one mistake away from bankruptcy, or under attack by predatory competitors or changing market dynamics (or, at least, is perceived to be such)–its executives feel they have no choice. They have nothing to lose. Under this perception they tend to take risks (what alternative do they really have?), trust their employees, provide them with the freedom so critically needed to be creative, and implement those “crazy” ideas.

My own two-year study (From Startup to Maturity) ties the higher level of startup creativity to the focusing fear that startup companies have in common that causes them to trust employees with freedom, and the lower innovation levels of mature companies to the lack of fear perceived by leaders, which causes them to deploy “command and control” management.

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