Oliver Wyman’s latest report in its Global Leadership Imperative series takes a look at innovation’s relationship with leadership. According to the research, 65 percent of executives still don’t have an innovation strategy in place. Carole France, partner, Oliver Wyman Delta Executive Learning Center, talked to Consulting about the research, and how to strengthen that innovation-leader relationship.

Consulting: What is the leader’s role when it comes to inspiring innovation?

France: We’ve done a number of interviews and surveyed a number of people, and it’s become pretty clear that the companies who excel in innovation have leaders who have three sets of traits in common. The first thing they have to do is create a climate in which innovation can occur. The mistake that leaders makes often is to believe that if they just hire really smart, creative people, innovation will just happen. Well, we’ve learned it doesn’t just happen. They have to create a climate in which it can happen and in which it’s nurtured. And then they need to create a culture and values where employees—not just R&D people who have been hired to be innovators—but all employees play some kind of a role. We’ve also learned that in that culture is that people who have these kinds of cultures, leaders who create these kinds of cultures don’t talk about managing conflict. They talk about encouraging disagreement and finding venues in which they can elevate different points of view. That’s a big piece of that culture where different points of view are celebrated, they’re honored and people don’t worry about conflict, they don’t see it as conflict. Then the third thing is this notion of an organization structure that supports the whole generation and execution of new ideas.

Consulting: How do you begin to transform a culture that isn’t inherently innovative?

France: Well, it’s hard work, but it can certainly be done. I think the first thing that has to happen is the leader has to have an absolute clarity that we’re about innovation and that we’re about innovation as implementing ideas that create value. I think that’s a really important concept to share—that it doesn’t have to be necessarily radical new disruptive innovation. It’s ideas that create value, so it’s more than products and services. A lot of times you realize your greatest return is through innovative business models. Those are much harder to duplicate than a product or services. So it’s that clarity of purpose and that having a broad [sense] of innovation.  

Consulting: Can you ever be too innovative?

France: The short answer is yes, but let me expand on that. A company could become chaotic and lack focus, and yes, could in fact spend too much time and money on ideas that have no chance of creating value. Can you be too innovative if you’re disciplined? No. But if you don’t have the discipline and the focus, yeah, I would say you could.

Consulting: Say you’re innovative executive, but your company isn’t. How do you convince others to give your ideas a chance?

France: Well, I think the first thing you have to do is attack the culture and that would be expected the culture would fight back. And I think you can start with the small wins. I think the person who has really strong collaboration skills is able to work across boundaries. But I think you have to start small in that case and take it one step at a time working with individuals and groups. And we’ve certainly seen that, where there can be bubbles in innovation, where there are people who can accomplish amazing things within a culture that doesn’t necessarily support it. Now you’re probably not going to get your really huge wins in that case probably. You’ve got to pick your battles.

Consulting: What qualities does one need to have in order to get that buy in?

France: I think it is sending some kind of a message; it’s having a strong belief. It’s also being really open to other points of view and starting from a collaborative approach as opposed to a ‘I’m-forcing-this-on-you’ approach. It’s a push-pull thing—how do I pull people into my idea? And folks who have those skills are much more likely to be able to do that.

Consulting: What is the relationship between innovation and change management?

France: A very strong relationship. This is my personal point of view, I’m not speaking for my firm. Change management is just almost plain leadership anymore. What leader isn’t dealing with change all the time? So innovation and change management are integrally related.

Consulting: Was this research a response to client demand or something that Oliver Wyman wanted to pursue on its own?

France: Both. It became so clear when we would sit down and when we would interview execs and we would talk about doing some kind of intervention within their leadership. When you looked at the priorities, innovation was always in the top three. Executives know they absolutely have to be more innovative. And we would also hear about it at the lower levels.

Consulting: So are executives taking more responsibility for innovation?

France: I think they’re seeing innovation differently than they did before. I think for many years innovation as something that belonged in the hallowed halls of R&D, as opposed to a much more pervasive organization initiative. Innovation comes from a couple of people sitting around having conversations who have different points of view. That’s a very different approach than the very vertical approach that I think historically executives have held that to.