Creating an Innovation Culture: Key Characteristics and Examples You Can Model

February 21, 2023 Workhuman Editorial Team
collaborative innovation culture

We have all found ourselves in a rut before. Whether it’s because the ideas just aren’t coming, you’re procrastinating, or you’re too overwhelmed with the day-to-day of life to think of anything but, this block can be hard to push aside. 

Those same dilemmas can happen to organizations, too. So, how do you bring your culture to life with new and creative ideas?

That’s exactly what this guide aims to answer. We’ll cover what an innovation culture looks like in 2023, focusing on the key characteristics, how it works, and how to establish it within your company, all while reaping the benefits it provides.

Now let’s get down to business! 

What is innovation culture?

Innovation culture is comprised of social norms, patterns, and shared behaviors from employees at an organization that allows ideas and creativity to thrive within it.

For many, innovation means something different and new. Conversely, for leaders and executives alike, you shouldn’t restrict innovation solely to creativity, but rather revolutionary ideas that hold and produce great value. 

Such ideas don’t necessarily have to be new. They can be existing methods that are used in a fresh and unorthodox way. Innovation is asking yourself: How can I improve something I’ve previously done, and would it be useful now?

Cultural innovation nurtures groundbreaking thinking to spur ideas that break cultural barriers – being brave to defy the status quo for long-term company survival.

In our current society, culture is a delicate topic and even more fragile when one suggests breaking its barriers. However, as business leaders, it’s important that you’re able to see the bigger picture. 

Breaking the cultural barriers in your company means freeing your employees from the stifling day-to-day routines. It offers novel ways of developing a healthy environment for happy employees.

To achieve this, you have to first determine the characteristics you need to have in your company to flourish.

What are the key characteristics of innovation culture?

In Brian Leavy’s book “A Leaders Guide to Creating Innovation Culture“, he found that, “A key factor in boosting innovativeness is establishing the right organizational climate to nurture the creative potential of employees and make use of their knowledge of customers, competitors, and processes. When leveraging the best innovation practices of other companies look to their philosophy and values.”

Inside a workplace exists a leader and employees. The key characteristics of innovation culture should be present in both to influence change that’ll benefit employees, the workplace, and society in the process.

1. Strong and effective leadership

Aristotle once said, “The role of a leader is to create an environment in which all members of an organization are available to the opportunity to realize their potential”. We know it sounds like a lot of pressure, but in actuality, it’s a lot of inevitable greatness.”

A good workplace culture stems from a leader that knows how to direct the company onto the right path. To be an effective leader, practice the following traits:

  • Good listener and communicator
  • Transparent and trusting
  • Effective in giving tasks to the right person
  • Has a logical goal
  • Firm in every decision to make

2. A positive outlook on failure

As leaders, turning every failure into an opportunity should be a natural impulse. There’s always a lesson to be found in every battle and defeat.

You can apply the question: How can I make better use of this? Such behavior aligns your company with an innovative culture.

Stoic philosophy focuses on turning misfortune into a new opportunity. You could try adapting this thinking when your company faces adversity.

3. Constant inspiration

It’s necessary to always be under the assumption that there are better ways to create a product or execute a task. Be a source of inspiration that aspires your employees to move in new and forward-thinking directions. Pitch in ideas openly during meetings or events to nudge your employees to do the same.

With consistent effort, watch your employees follow suit while brimming with new inspiration.

4. Strategic innovation

Strategize innovations that are based on your product. Deviating far from your organization’s identity in pursuit of change may damage the company’s reputation. Ensure strategizing accordingly to create loyal customers who enjoy your brand.

5. Freedom in being creative

A workplace that’s constrained depletes motivation, which is an essential aspect of an innovative culture. Let your people explore fearless, creative solutions to a problem (that are grounded within the company’s mission and values). 

Fostering a creative workspace relieves tension and disrupts the monotonous routine that induces stress.

6. Having goals and purpose

The primary drive of a company is knowing where it’s headed. Set a meaningful and authentic purpose to get people on board towards innovative change. 

7. Trusting environment

If we want a trusting environment that cultivates innovation, then we have to make a workplace that is full of trust, too. A company can only work together if it has a strong, united culture. To have unity means learning to rely on one another first.

With Moodtracker® from Workhuman, leaders can quickly identify any issues within the organization and put specific solutions into place, showing how important the feedback process is for trust and transparency. 

Try Moodtracker® today!

8. Collaboration

Innovative ideas stemmed from a collaboration of unique minds with the same goal. Encourage your people to pitch in ideas and give structured feedback.

Discuss. Brainstorm. Communicate. Workhuman nurtures collaboration by creating a culture of ongoing feedback. They highlight the importance of conversations to encourage productivity among employees.

Don’t be afraid of dissenting voices. Innovation is sometimes a product of clashing ideas. As Pythagoras believed, “The world depends upon the interaction of opposites.”

9. Autonomy at work

An environment induced by strict control can kill the work drive. Too many constraints may suffocate an individual, causing them to leave the company. 

Practice a leadership style that sets a goal for employees, then trust them to accomplish the assigned task in the best way they can think of. This strategy is effective in our experience as it alleviates potential stress.

10. Recognizes emotional intelligence

Acknowledging excellent performance with a reward can push your employee on the right path. People not only work physically, but they exert mental and emotional effort too. Failing to take that into account will force a strain on them.

The goal is to have a happy and satisfied employee that can lead to a culture of innovation. Workhuman offers solutions on how you can do that by amplifying your employee’s wellbeing through the power of recognition.

Leavy sums up the key practices as this:

Key practices: place people and ideas at the heart of management philosophy; give people room to grow, to try and learn from mistakes; build a strong sense of openness and trust and community; and facilitate the internal mobility of talent.

What an establishment without a culture of innovation looks like

Many companies have invested billions in advanced technology and infrastructure to discover innovative, ground-breaking ideas. Nevertheless, executives often find themselves at a dead-end despite their infinite expenditures.

Because of this, most companies have recognized innovation to be costly—or not worth investing in.

The simple reason for a stagnant company is a cease of innovative thinking. No matter how much an executive spends on expensive luxuries to motivate employees, a company that stops innovating is a company that stops entirely. 

It all roots back to an environment that hinders free thinking. When an employee’s actions are limited, so are their solutions and ideas. Such an environment can lead to a toxic workplace and cause organizational inertia.

Remember that employees are the backbone of a company. Once they stop moving, so does your business.

strong leadership showing employees new plan

The benefits of developing an innovation culture

Knowing what an organization without innovation looks like gives us the hindsight to cultivate it earnestly. Now let’s focus on the benefits of developing an innovation culture and its importance.

1. It solidifies teamwork

Working in a healthy and accessible environment produces happy employees. When people are happy, positive interaction follows, solidifying connection and teamwork.

This means outstanding performance, growth for the business, and healthy workers. So when a crisis emerges, your company can prevail against it, while also remaining a powerful unit.

2. Progress without limits

A small difference can lead to big development. Once people are free to try all the possibilities without limits, it’ll spur motivation for improvement and more innovation. Your team may even willingly take on the impossible. More progress for the company!

3. Fresh marketing approaches

Your company will need to keep up with the ever-changing wants and needs of customers. Good brainstorming may produce new perspectives on how to save your revenue from dropping.

Innovation can even entice a new batch of customers because of fresh marketing ideas. Expect your business capital to flourish—it’s a reward well deserved!

4. More employee opportunity

With the steady increase of happy workers and fruitful results, your company is bound to be recognized by employees as a good place to work. A healthy and innovative workplace will attract top employees who are ready to offer their talents for the company’s benefit.

For more information on attracting and retaining top talent, check out this “Employee Retention Checklist.”

5. Dedicated employees

Managing an innovative organization will induce a sense of dedication in your employees. Giving value to innovation culture inspires your workers to invest more in the company, team members, and even you as a leader. 

A workforce with loyal employees survives longer. Other than that, having an innovative culture present in a workplace provides many opportunities for your employees, such as:

  • Improved products and branding
  • Increase in ground-breaking ideas
  • The advantage over other companies
  • Comfortable workplace for a happy employee

What companies have built effective workplace environments for innovation?

Some of the well-known firms that are standing successfully to this day have a common denominator: relying on a culture of innovation strategy. We’ve listed two companies you might recognize right away.


The industry has been famous for its creative animated films since 1986. The core of Pixar’s culture is believing that quality is the best business plan and recognizing that failure isn’t always evil. Along with many other core values and principles, Pixar managed to survive years without downgrading its quality. And they’re still growing!

Pixar is dedicated to creating an environment where its culture nudges people to be candid, celebrate experiments, and take risks. It fosters psychological safety that makes their employees feel comfortable with the uncomfortable, and have support from one another.

Most importantly, they value positive feedback to cultivate progress. Pixar heavily enforces their people not to judge another person’s work, but to offer help for growth and development.

Working at Pixar is all about trust and support. Even when a colleague commits a mistake, they believe that having oneness produces collective creativity. 

employee making plan to build a collaborative and innovative culture


The corporation that pioneered the development of the PC. Their innovation strategy focuses on holistically enabling technological advancement and accepting diversity. 

When new leaders took hold of Microsoft and implemented individualism and bureaucratization, it led to corporate inertia. They remained rigid and stagnant for a time, endangering their profit and reputation.

Fortunately, a drastic, positive change saved Microsoft from the brink of failure when Satya Nadella took the mantle of CEO. Nadella took charge of shifting the culture from stationary to innovative, goal-oriented, creative, empathetic, and humble.

As of now, they earnestly seek diversity and apply it in the organization. Microsoft’s principal developer evangelist, says, “Our growth mindset culture lets us try amazing things; we are innovating like crazy right now”

7 ways to make a culture change to promote innovation

Creating an innovative culture requires a necessary change in the workplace. It doesn’t need to be big, depending on where your organization stands now. Here are seven ways to make a cultural change.

1. Be an innovative leader

Be a leader that learns how to add value to people’s lives in new and meaningful ways. Adapt a philosophy and techniques that promote inventive ideas to procure products and services that customers would want. 

2. Encourage the unorthodox

Encourage your employees to think beyond their assigned roles. No limits, no holding back. Let your people nurture their creative ideas to solve critical problems. The road to radical and transformative solutions starts with thinking outside the box.

3. Inspire intellectual bravery

Let your employees engage in discussion, have disagreements, and challenge the norm to spark innovative methods. Granted, it comes with the risk of employees failing and being embarrassed, and that’s entirely normal. Success entails learning from past mistakes. 

So, help your people with this challenge by giving positive reinforcement, such as praising—or reprimanding if the situation calls for it—through incentives.

4. Admit vulnerability

Admitting what you don’t know means accepting room for potential knowledge. It busts the conventional thinking that leaders are absolute, and thus harder to approach. 

Admitting vulnerability establishes a common ground between you and your employees. Standing on equal footing creates a safe space for candid communication and humility. 

Model this attitude towards your employees to show that they could do the same. 

A diverse group of professionals brainstorming ideas for a culture of innovation

5. Embrace change

One way or another, you must accept change if you want to pursue an innovative culture. With the coming and going of technology, knowledge, and trends, you must be ready to embrace new ideas and ease the restriction on creativity.

6. Experiment logically

An innovative organization recognizes the need to experiment and acknowledge frequent failures. Be empowered to challenge and accept any risks—given you have countermeasures for every risk—to make a change.

Engaging in an innovative culture means being open to risks and ambiguity. Celebrate experiments and have fun with the process. 


Big or small, changes caused by innovation culture might be what your company needs for everyday improvement. It not only spurs growth for the company but encompasses everyone working in it.

Sometimes, the unconventional way is the right way to stand against adversity and survive the business competition. While it’s certainly not going to be a smooth ride toward achieving an innovative culture, it will be worth it. 

With patience and determination, you can pull off having a balanced culture that supports innovation while staying grounded in discipline and consistency. 

Company Culture