The Critical Role of Trust in the Innovation Process

By: Jeffrey Baumgartner

The innovation process requires considerable amounts of trust. The innovation process involves risk both for the firm running the process and employees participating in the process. Jeffrey Baumgartner outlines some practical ways to increase the level of trust, and therefore the level of innovation, in your firm.

The innovation process requires considerable amounts of trust. Without it, the process is unlikely to produce much more than incremental innovation. Worse, great ideas devised by employees are likely to be taken elsewhere for implementation. Indeed, in an innovation survey published by PriceWaterhouseCoopers in the early 2000s, trust was identified as a key characteristic of innovative companies. It is not hard to see why.

The innovation process involves risk both for the firm running the process and employees participating in the process. The firm must invest resources in the process and it must be willing to implement creative ideas which have the potential to become innovations (remember, an idea is not innovative until it has been successfully implemented). Creative ideas are inherently more risky than incremental improvement ideas. Unless the firm is willing to take on this risk, its innovation investment will bring only incremental results.

Personal risks

Employees also take risks by participating in the innovation process. Depending on the company, they might face ridicule, reprimand, lost promotional opportunities and dismissal. Or, they might look forward to recognition, responsibility and improved promotion prospects. It goes without saying that if employees can look forward to the latter set of actions, they are more likely to participate. For this to happen, they need to trust their colleagues, management and company.

The company needs to ensure that risk is minimized through trust.

Risk rears its ugly head during several parts of the innovation process. The company needs to ensure that risk is minimized through trust. Let’s see how it works.

Identifying problems

Although many people believe organizational innovation starts with ideas, it actually starts with identifying problems and goals. Finding fault in well established processes is easy. Communicating it to superiors who may have a stake in that process is challenging. People who criticize corporate processes may well be branded trouble- makers, rebels or worse. Unless a firm openly invites people to question assumptions and established processes, most employees will keep criticism to themselves or, at best, share it at the coffee machine with colleagues of equal standing.

While many firms may claim that they are open to the questioning of assumptions and criticism of processes, the employee must trust the firm that it is being open and honest. Without that trust, criticism will not be shared.

Idea generation

Albert Einstein is credited with saying: “If at first the idea is not absurd, then there is no hope for it.” This is true, great ideas almost always seem absurd at first. Unfortunately, so do absurd ideas!

For many people, being absurd in front of their colleagues and, especially, their superiors, is a scary thing. Unless, they trust superiors and other colleagues to take all ideas seriously rather than laugh, criticize or worse, most people will keep their more absurd (and hence creative) ideas to themselves.

In many organizations, the person who suggests lots of absurd ideas may quickly be branded as a clown. And while clowns are jolly good fun at the pub, they are probably not on the fast track for management. In other words, without trust, the more creative ideas are not shared. They are suppressed. And with sufficient suppression of creative ideas, most people learn to be less creative at work. And without creativity, innovation simply will not happen.

In a trustworthy organization, on the other hand, crazy ideas are embraced and the people who propose them most often are recognized as creative thinkers – not clowns.

Championing crazy ideas

In many firms, managers, who champion ideas that are rejected as non-viable, are branded as losers. Intelligent, creative managers learn this quickly. They also learn to champion the least risky, least creative ideas rather than risk acquiring the loser label. As a result, the most creative ideas are ignored in favor of mediocre ideas that are sure not to fail, even if their success potential is limited.

Of course trustworthy top management does not brand subordinates as losers under any circumstances. Quite the opposite. They respect managers who see potential in creative ideas and are willing to take risks by championing them.

High-risk projects

The greatest level of personal risk an employee in most firms can take on is managing a potentially innovative project. As noted, such projects are very risky. If they succeed they can result in huge benefits, usually in the form of increased profits, improved position in the market and recognition as being a leading firm. If the potentially innovative project fails, on the other hand, money will have been lost, resources wasted and the people responsible fired – or at least passed over for promotion for a few years.

Oops! Of course that last bit, about being fired or passed over for promotion, should not be the consequences of managing a potentially innovative project, should it? But you and I both know it very often is the case.

If a company’s best people know that leading a failed project – or even being on the team – is dangerous to their career, they will quickly learn to avoid risky, potentially innovative projects like the plague. Needless-to-say, if people avoid projects that have the greatest innovation potential, those projects are unlikely to ever come to fruition.

Managers in trustworthy companies, on the other hand, know not only that they can take risks by managing innovative projects, but that they will be rewarded for doing so. They also know that if the project does not succeed, they will not be reprimanded. Rather, they will be expected to drop the project quickly, share what they have learned and take on a new project.

In companies where failed projects lead to failed careers, managers are highly reluctant to drop a project and admit failure.

This has two benefits. Firstly, managers will be keen to take on potentially innovative projects without fear of unpleasant consequences. Secondly, if a project is not succeeding, they will not be afraid to drop it and focus on something else. In companies where failed projects lead to failed careers, managers are highly reluctant to drop a project and admit failure. Instead, they tend to throw more resources into the project and hope it improves. As a result, failed projects are even more costly in financial terms. In other words, the company and the responsible manager lose when failure is not an option!

Making your firm more trustworthy

The lessons to be learned here, if you want to make your firm more trustworthy, are simple:

1. People should not be criticized for identifying problems and weaknesses with existing processes. They should be listened to and rewarded.
2. People should not be criticized for having outlandish ideas. Rather, those ideas should be evaluated as they may have tremendous innovation potential. If the ideas are not viable, explain why and complement the person or team who has proposed them. Never criticize the people for being creative, even if their ideas do not work.
3. Managers who champion radical ideas and take on risky projects should be recognized as your top people and critical to your innovation process. They should never be reprimanded for failed projects without good reason (such as fraud, making the same mistake over and over again, committing a crime and similar actions which are morally, ethically or legally unacceptable).

How about your firm? How trustworthy is it?

By Jeffrey Baumgartner