Innovation leadership is a philosophy and technique that combines different leadership styles to influence employees to produce creative ideas, products, and services. The key role in the practice of innovation leadership is the innovation leader.Gliddon, D. G. (2006).
Forecasting a competency model for innovation leaders using a modified delphi technique. (Doctoral dissertation) Dr. David Gliddon (2006) developed the competency model of innovation leaders and established the concept of innovation leadership at Penn State University.
As an approach to organization development, innovation leadership can support achievement of the mission or the vision of an organization or group. With new technologies and processes, it is necessary for organizations to think innovatively to ensure continued success and stay competitive.Dess, G. G., & Pickens, J. C. (2000). Changing roles: leadership in the 21st century. Organizational Dynamics, 28, 18 – 34McEntire, L. E., Greene-Shortridge, T. M. (2011). Recruiting and selecting leaders for innovation: How to find the right leader. Advances in Developing Human Resources, 13, 266- 278Sarros, J. C., Cooper, B. K., & Santora, J. C. (2008). Building a climate for innovation through transformational leadership and organizational culture. Journal of Leadership & Organizational Studies, 15, 145-158Shipton, H., Fay, D., West, M. A., Patterson, M., & Bird, K. (2005). Managing people to promote innovation. Creativity and Innovation Management, 14, 118-128Tushman, M., & O’Reilly, C., III. (1996). Ambidextrous organizations: Managing evolutionary and revolutionary change. California Management Review, 38, 8-30 to adapt to new changes, “The need for innovation in organizations has resulted in a new focus on the role of leaders in shaping the nature and success of creative efforts.Mumford, M., & Licuanan, B. (2004), Leading for innovation: Conclusions, issues, and directions. The Leadership Quarterly, 15, 163-171” Without innovation leadership, organizations are likely to struggle. This new call for innovation represents the shift from the 20th century, traditional view of organizational practices, which discouraged employee innovative behaviors, to the 21st-century view of valuing innovative thinking as a “potentially powerful influence on organizational performance.”Mumford, M. D., Scott, G. M., Gaddis, B., & Strange, J. M. (2002). Leading creative people: Orchestrating expertise and relationships. The Leadership Quarterly, 13, 705 – 750
Overview
To have a clear understanding of what innovation leadership involves, one must first understand the concept of innovation. Although there is some controversy over how it can be defined, through general consensus in the literature, it can be described as novel ideas of viable products that are put into operation.Hunter, S.T., Cushenbery, L. (2011). Leading for innovation: Direct and indirect influences. Advances in Developing Human Resource, 13, 248-265 It includes three different stages, which are all dynamic and iterative (constant):
Idea Generation Evaluation Implementation
The two types of innovation include exploratory innovation, which involves generating brand new ideas, and value-added innovation, which involves modifying and improving ideas that already exist.Benner, M. J., & Tushman, M. L. (2003). Exploitation, exploration, and process management: The productivity dilemma revisited. The Academy of Management Review, 238-256Jansen, J. J. P., Van den Bosch, F. A. J., & Volberda, H. W. (2006). Exploratory innovation, exploitative innovation, and performance: Effects of organizational antecedents and environmental :moderators. Management Science, 52, 1661−1674March, J. G. (1991). Exploration and exploitation in organizational learning. Organization Science, 2, 71−87Rosing, K., Frese, M., & Bausch, A. (2011). Explaining the heterogeneity of the leadership-innovation relationship: Ambidextrous leadership. The Leadership Quarterly, 22, 956-974 Ideas generated must be useful to be considered innovative. Innovation should also not be confused with creativity, which is merely the generation of a novel idea that may not necessarily be put into operation—though these words are sometimes used interchangeably in research literature when speaking about innovation leadership. Innovation leadership is a complex concept, as there is no single explanation or formula for a leader to follow to increase innovation. As a result, innovation leadership encompasses a variety of different activities, actions, and behaviors that interact to produce an innovative outcome.
Value-added innovation
Exploratory and value-added innovation require different leadership styles and behaviors to succeed. Value-added innovation (PwC, 2010) involves refining and revising an existing product or service and typically requires minimal risk taking (compared to exploratory innovation, which often involves taking a large risk); in this case, it is most appropriate for a leader for innovation to adopt a transactional form of leadership.Oke, A., Munshi, N., Walumbwa, F. O. (2009). The influence of leadership on innovation processes and activities. Organizational Dynamics, 38, 64-72 This is because a transactional leadership style does not use open leadership behaviors such as encouraging employees to experiment and take risks, but rather uses closed leadership behaviors that do not condone or reward risk-taking. Companies whose innovation leaders use transactional leadership for value-added innovation purposes include Toyota Motor Co., General Motors Corp., and Ford Motor Co.; examples of these companies’ value-added innovations such as making improvements on existing cars by making them faster, more comfortable, and getting better gas mileage.
Occasionally a value-added innovation may require a completely new way of thinking and possibly taking new risks. An example of this scenario can be illustrated through Aspirin; this was an existing product, traditionally used as an analgesic to alleviate aches and pains, but has been introduced into a new and different market by extending its uses to help prevent heart attack and reduce blood clot formation. In this example, the usage of an existing product was re-worked and introduced into a new market. While an existing product is being changed and/or improved upon, characterizing it as a value-added innovation, outside-the-box thinking, research, and risk-taking are now required since it is being introduced into a new market. In this case, a transformational leadership style is a more appropriate style to use.
The innovation leader must gauge if (and how much) risk and radical thinking are involved in the value-added innovation to determine which leadership style to use in a situation. The leader must be flexible—able to switch leadership behaviors when necessary.
Exploratory innovation
Exploratory innovation refers to the generation of novel ideas, strategies, and solutions through the use of strictly open behaviors exhibited most often by transformational leaders. The foundation of exploratory innovation is characterized by search, discovery, experimentation, and risk taking. It is the organization's focus on generating new ideas, products and strategies; in contrast to exploitative innovation, which focuses on building and extending already existing ideas. Some studies have shown that explorative and exploitative innovation require different structures, strategies, processes, capabilities, and cultures.He, Z., Wong, P. (2004). Exploration vs. Exploitation: An empirical test of the ambidexterity hypothesis. Organization Science, 15, (4), 481-494 See Innovative Organizational Climate/Culture. Exploratory innovation requires flexibility, opportunism, adaptability, and for leaders to provide intellectual stimulation to their subordinates. In this approach to innovation, the leadership style that is primarily used is transformational. The behaviors exhibited are believed to achieve the desired creative outcome from employees through the application of individualized consideration, charisma, and inspirational motivation.
For example, in one study of the innovation practices at AXA Insurance in Ireland, the CEO John O’Neil engaged in transformational leadership behaviors and introduced the “MadHouse” program that combined workers from different departments and levels of the organization to work together in a creative way. The result of this experiment after six months was 150 new business ideas for products and services.Oke, A. (2002). Improving the innovative capability of a service company. Journal of Change Management, 2, (3), 272-281 Explorative and Value-added innovation are often referenced together, but surprisingly little research shows an interaction between the two. However, there is an understanding that in some circumstances a ‘balance’ must be attained to achieve superior employee performance. For example, not all novel ideas are implemented, and may be resurrected later. The organization may need to switch gears and adopt exploitative strategies to revise and refine the idea to match present needs.
Foundations
Innovation leadership has roots in path-goal theory and leader-member exchange theory. Certain elements within an organization are also needed for innovation leadership to succeed. Wolfe (1994),Wolfe, R. (1994). Organizational innovation: Review, critique and suggested research directions. Journal of Management Studies, 31, 405-431 as cited by Sarros, Cooper, & Santora, (2008) has pointed out that one antecedent factor for innovation is organizational culture. Likewise, Isaksen, Laver, Ekvail & Britz (2001) Isaksen, S. G., Lauer, K. J., Ekvail, G., Britz, A., (2001). Perceptions of the best and worst climate for creativity: Preliminary validation evidence for the Situational Outlook Questionnaire. Creativity Research Journal, 13, (2), 171-184 concur that innovative endeavors fail without a supportive climate. This antecedent of a supportive organizational culture/climate encompasses encouragement of creativity, autonomy, resources, and pressures. Additional foundational elements for innovation leadership include creative work, a creative workforce, and certain leader attributes.
Roots in path-goal theory
The basis of path-goal theory uses a similar view of leadership, in that it advocates different types of leadership (e.g., participative, supportive) behaviors, much like innovation leadership does. However, it is contingent on employee and environmental factor to be effective.House, R. J., (1996). Path-Goal theory of leadership: Lessons, legacy, and a reformulated theory. Leadership Quarterly, 7, (3), 323-352Evans, M. G., (1996). R. J. House’s “A Path-Goal Theory of Leader Effectiveness”. Leadership Quarterly, 7, (3), 305-309 The idea of a single leader using different leadership behaviors originated in path-goal theory, and has been associated with the framework underlying innovation leadership, which also allows the creation of a work environment conducive to innovative thinking—which is the cognitive process of generating novel and useful ideas.
Creating this type of work environment through innovation leadership involves open leadership behaviors that resemble some leader behaviors proposed by Path-goal theory—for example, upward influence and supportive/considerate behaviors. In innovation leadership, these behaviors encourage the creative team to generate as many novel ideas as possible and lead to evaluation and implementation of these ideas.
Roots in leader-member exchange theory