Every company wants to be innovative. Innovative companies invent new markets. Innovative companies get bigger and last longer. But it’s not every company that turns out to be innovative. Our work at Collective Next has shown us that you can’t just wave a magic wand and make people more innovative. Perhaps the most important thing a company that wants to be innovative can do is create the conditions that nurture a vibrant community of innovators.

I’d like to share some of what we’ve learned about how to build a company and a culture where people are encouraged to innovate. In particular, I’d like to discuss three things you can do as a leader that that can make innovation a lot more likely.

First of all, you’re a lot more likely to see innovation when people and ideas have lots of chances to bump into one another.

In art, as in other fields, there’s the myth of the solo genius. But some of the greatest periods of innovation in art history have come from vibrant communities of discourse. Think about the great art movements – Impressionism, Cubism – they’re movements. It wasn’t just Monet or Picasso. These movements were full of likeminded superstars and near-superstars who could inspire one another, argue with one another, and come up with ideas that they never would have come up with if they were working totally solo. Artists would literally bump into each other in studios and cafes, and as a result ideas their ideas bumped into each other, too.

Our headquarters is in downtown Boston. Up the road in Concord 150 years ago, you would find some of the greatest American writers ever – Louisa May Alcott, Ralph Waldo Emerson, Nathaniel Hawthorne, Henry David Thoreau – all neighbors at the same time. Each of them did work that influenced the other; each of them encouraged and edited one another. How close were these people? When he wasn’t in his famous cabin in the woods, Thoreau babysat Emerson’s kids. Pretty close.

And it’s not just art where this can happen. Think of how the Internet revolution has been accelerated by the fact that so many of the breakthrough companies are located in clusters like Silicon Valley or Cambridge and Boston. The clusters promote innovation within companies, of course, but they also create the conditions for inspiration across companies.

Historians call these “genius clusters,” a statistically unlikely consolidation of inspired voices who come together with a shared purpose. Even in their solo work they create something that would have been unimaginable without the input of the other great ideas surrounding them.

How do you make your company the natural home for a genius cluster? Obviously you need intelligent and creative individuals, but successful companies have that already. The trick is building strong social networks that are diverse and accessible, establishing pathways for those individuals and their ideas to play off each other. True disruptive innovation usually happens in the horizontal rather than the vertical, in the intersection of ideas. To foster an innovative culture, leaders need to build cross-knowledge-pool networks. That way, your people will be able to tap in to other types of problem solvers when they face difficult challenges – the sorts of challenges that are more complex than one person can deal with. They’ll be open to new ways of seeing and doing.

At innovative companies, ideas from the outside bump into ideas from the inside. There were plenty of good mobile devices before Apple blew the category open with the iPod and then the iPhone. Remember the Creative Nomad Jukebox? The PalmPilot? Both were market-worthy but it was the iPod and iPhone that became iconic. So many of us have them in our pockets because they were horizontally successful. They integrated the right technologies at the right time.

The most elegant design and effective marketing wouldn’t have been as successful if so many technological advances, many of them outside Apple’s control, hadn’t converged. The combination of advances in miniaturizing data storage, expanding battery life, scaling up of manufacturing, and explosive gains in bandwidth added up to the perfect moment for a product like the iPhone. Vertical innovation in one area wasn’t enough; the uber-innovation came in harnessing the innovations across fields. Apple didn’t make all those trends happen, but it had people looking at different parts of that problem who were ready to act and work together when the trends came together. Perhaps Apple’s greatest innovation isn’t what it comes up with itself but how it smartly takes advantage of, incorporates, and extends what is happening around it into elegant design. The real innovation is the recognition of the trends, the combining of them, and the ease of use in exploiting them.

Steve Jobs didn’t create the iPhone. What he created were the conditions for a large group of talented individuals to pool their knowledge together in valuable ways.

Second of all, innovation is more likely when people and their work are celebrated for pushing limits.

A company’s culture is shaped by the stories it chooses to tell and the people it chooses to celebrate. I know there’s a widespread belief among leaders that you get what you measure, and there’s some truth in that, but I think even more important is that you get what you emphasize. It’s an important distinction. People want to be recognized for their work. Leaders show recognition when they choose which legends they want to share about their company and their successes. The most famous of these are origin myths – think Bill Hewlett and David Packard in their garage. That sense of adventure and purposeful play permeated Hewlett Packard’s culture for decades.

Innovation is hard. It tests our patience and our fortitude. Bringing any new idea to market requires facing countless barriers along the way. Sometimes the most imposing barriers come from within companies, before the idea has had any contact with the outside world. Without the right role models that encourage people to keep going, great ideas can be prematurely abandoned, overly diluted, or never recognized for the breakthroughs they are. Leaders in an organization who want more innovation need to share stories that embody what they want to see in the world. 

Know who your stars are and what they’re working on. Support them. Celebrate them. Offer clear role models for success. That way, other people in your organization will want to follow them. Even better, they will feel they have permission to go even further.

If you want innovation, you want people to feel they can push limits. By choosing to emphasize people and projects that push limits, you show what’s important to your organization. We all know that if work is not recognized, there’s a good chance that people will stop doing it. Companies that foster a culture of innovation have a tolerance for pushing limits, even if it results in the occasional failure on the long road to success. Part of what makes a company innovative is the quality of the people who are attracted to work there. Of course you want to hire and promote the smartest, most forward-looking people. But again one of the keys to innovation is creating an environment in which these great people work together and come up with something they couldn’t have separately. But that’s not enough. People need to know that they and their work will be recognized. Encouraging and publicly rewarding experimentation are keys to encouraging innovation over the long term.

One of the projects we’ve done at Collective Next that means the most to us is the Thinkspace we built and managed for our longtime client Fidelity Investments. The idea behind the Thinkspace was to create a place where people could interact without the usual constraints you find in a standard meeting room. Pretty much everything about it could change. Furniture, whiteboards, even lighting could be moved around as demands changed or inspiration dictated. People presented there, but it wasn’t set up as a conference room or an auditorium. It was a collaborative working environment, an open, endlessly customizable place where people could think big. And once people learned they had a new kind of physical space, they went there thinking they could innovate. When you’re creating a culture of innovation, symbols matter. Think hard about the cues you’re giving to your organization.

The final concept is that innovation happens when you hold open big questions, along with the possibility that you might be able to solve them.

There’s a trend in management literature to think more about your company’s mission questions and less about its mission statement, and that makes a lot of sense. Knowing what you’re trying to answer opens you up to the possibility that you just might.

There were big questions haunting AT&T right after World War II. It faced an enormous challenge: its phone network worked on vacuum tubes, which were so slow, bulky, and power-hungry that they were holding the company back at a time when the demand for phone service was off the charts. AT&T’s R&D unit, Bell Labs, had the job of figuring out how to get past vacuum tubes. This inefficiency was holding the company back dramatically. William Shockley, a brilliant physicist, had been trying for nearly a decade to figure out what could radically advance communications beyond the vacuum tube, but he wasn’t able to get anything to work. It wasn’t until he connected to two colleagues with expertise in different parts of physics that the team came up with the transistor. That semiconductor transformed communications. It earned the team a Nobel Prize and is seen by many as the birth of modern computing. And it still serves as the foundation for so much that happens in technology more than 65 years later.

Imagine holding open a question for a decade. Our desire for the “Eureka!” moment fails to take into account that breakthrough thinking often comes from a long period of sustained thought. The culture at Bell Labs encouraged specialists in different areas to experiment, collaborate, and keep asking those questions. 

The diverse team at Bell Labs had a sense of purpose that came from being a genius cluster focused on a big question: “What is the future of communications?” That was their central question. The specialists there were all open to new ideas from specialists in other fields, but that big question was the filter through which Shockley and his colleagues viewed the world. It hung over everything they did. Having that big question in mind focused attention and gave clear purpose to their work.

Of course you have to ask the right big question. Nothing kills innovation faster than the ruthless pursuit of the wrong idea. Thanks to the influence of the Design Thinking method made popular at Stanford’s d.school, there’s a question more and more companies are asking when they innovate: “how might we?” It implies possibility, exploration.

The idea actually goes back to Procter & Gamble in the early 1970s when they were trying to compete with Irish Spring, Colgate’s soap with the green stripe that promised “refreshment,” whatever that is. For months, Procter & Gamble executives and engineers were trying to figure out how to build a better bar of soap with green stripes until at last they realized that they needed to ask a more ambitious question. Instead of focusing on inventing better green stripes, they pivoted to “how might we create a more refreshing soap.” They weren’t in the green-stripe business, they were in the refreshing business. That led to the development of a still-successful brand of soap, Coast.

There are bigger questions out there than soap. In the developing world, one of the biggest questions is “how might we eradicate malaria.” There have been many bold attempts that have had varying levels of success. The most common interventions have revolved around encouraging people to use mosquito nets for their intended purpose. It turns out that, for economic reasons, many people use the nets to catch fish and damage them so much from fishing that they can’t be used in homes.

Some solutions have sought to eradicate the mosquitos carrying the disease. A group of scientists working in a lab set up by Nathon Mhyrvold, formerly of Microsoft, seek to eradicate malaria by eradicating mosquitos. How do they do this? With a laser gun that shoots mosquitos in mid-air. By the way, I once saw a demo of that mosquito-shooting laser and it was every bit as awesome as you’d imagine.

A laser to shoot mosquitos in mid-air may seem far-fetched, a little ridiculous. But ridiculous approaches can lead to valuable solutions. Whether you’re looking at something as mundane as soap or as crucial as defeating a deadly disease, keeping the big questions in mind increases the likelihood that you might be able to answer that big question. You’re not going to be able to answer a question you’re not asking. Innovators inspired by Hewlett and Packard aren’t playing in the garage for fun; they’re focused on the big technology question they’re trying to solve.

I would encourage you to ask: 

• How might we create spaces and processes that make it easier for ideas to bump into each other and your people to share what they know with each other?

• How might we celebrate people and work that pushes the limits of what we do, so others willt be inspired to do the same?

• How might we formulate the right big questions and hold them long enough to maybe even solve them?

We should spend as much time thinking about the conditions we create as we do about specific processes. If you do so, I think you’ll find that you’ve created an environment in which innovation and innovators can flourish.