Innovation is the process of taking a new idea, building and testing it, and then implementing it. It is distinct from creativity, which focuses on the generation of new ideas. Creativity is an important part of innovation, but it's only one step in the process. An organization’s ability to innovate is a proxy for its long-term success in competitive and dynamic business environments, research shows. Studies also show a positive correlation between innovation and an organization’s profitability.

In recent history, there has been even more pressure to innovate given the speed at which technology evolves. Many technology companies have made conscious efforts to build innovation into their organizational practices. 3M started their “15 percent time” program which gives employees the permission to use company resources to explore their own ideas, a concept that Google and others have borrowed.

There is no single way innovation happens, even within Google. And it doesn’t happen just because of playful, colorful offices — but it doesn’t happen without some investment either. Being innovative doesn’t need to be expensive, and while it can’t be forced, it must be nurtured.

Making innovation part of your organization means making it a valued part of the way people think, work, and interact every day. In Google’s experience, innovation happens when you create the right environment, hire the right people, and get out of their way. There are five attributes that Google believes contribute to the development and use of new ideas:

• Shared vision - Make sure everyone knows where the organization is heading.
• Autonomy - Allow employees to define their own work as much as possible.
• Intrinsic motivation - Hire naturally curious people who like to learn.
• Risk-taking - Enable employees to feel psychologically safe to take risks and try new ideas.
• Connection & collaboration - Make it easy for employees to find partners and work together.

Having a shared vision can help channel innovative efforts so that everyone knows what sorts of problems and challenges you’re setting out to solve. But this shared vision shouldn’t anchor you to the status quo — it should be a shared understanding that invites and encourages new ideas to solve the big problems your organization is tackling.

A shared vision aligns goals and priorities. People can see a change or new idea as a threat to their current work — especially when they don’t understand the context — and refuse to accept it. A shared vision can help remove the threat and empowers people to dedicate resources to a goal that’s universally accepted by the group. Try these:

• [Tool] Develop a team vision together. The vision explains why the team exists, what the team is trying to achieve, and how it’ll get there.
• Set audacious goals. Determine the objectives and key results (OKRs) to achieve your vision. At Google, OKRs are set at company, team, and individual levels each quarter. OKRs communicate where you’re headed and how progress will be measured.

Research suggests that giving people the autonomy to define their roles and act on their decisions is positively related to behaviors that lead to innovation, such as communicating ideas or suggesting changes. So after setting audacious goals, it’s important to get out of the way and let employees figure out the best way to achieve them. This type of approach is reflected in Google’s manager training; a good manager at Google is one who does not micromanage. Managers are encouraged to step back and let Googlers determine how best to go about their work. Of course, good managers are always on hand to provide advice and guidance if needed.

If you are hoping your employees will come up with novel ideas, you need to trust them not only to do their jobs but also to take risks.

• Arm people with information. From sharing upcoming product launches, to codebase access, to postmortem documentation, Googlers have access to a huge amount of information. This gives them the context and inspiration for new ideas in their work. By trusting your employees, you empower them to feel a sense of ownership of the organization and where it’s headed.
• Encourage curiosity and solicit questions. If you’re giving employees access to information, they're going to have opinions. At Google, half of all-hands meetings are often devoted to questions and answers, where any Googler has the opportunity to ask questions or make suggestions. Google places a lot of value in a person’s natural curiosity. Studies have linked curiosity to higher levels of learning, engagement, and performance at work. Give employees regular opportunities to speak up, whether it’s building in time for questions and feedback or running an employee survey.
• Give people an avenue to explore their ideas. This could mean removing barriers to time, money, or other resources — you can’t expect to get innovation with no investment. One way Google encourages ownership is through “20 percent time.” The original concept was that engineers were free to use 20 percent of their time to work on ideas that weren’t core to their jobs but were still related to Google’s work. A few 20 percent projects have grown into core products like Gmail and some have helped preserve historical artifacts like Google’s partnership with Yad Vashem. And while not all 20 percent projects wind up launching, employees still get the opportunity to learn new skills and collaborate with new teams. 20 percent time isn’t forced; many Googlers don’t spend their time working on side projects. However, everyone is encouraged to explore new ideas — so when the time comes to act on an idea, it isn’t frowned upon to do so.
• Foster a culture of learning. Another way for employees to feed their curiosity is to learn. Googlers are encouraged to develop and grow their skills by taking (or teaching) one of the many courses offered internally through the employee-to-employee learning program. Googlers teach one another skills ranging from learning to code in Python to learning to pilot small planes. Fueling that inner drive can lead your employees to be more creative and better problem solvers.

Your appetite for risk is another indicator of how innovative your company can be. Risk is an inherent part of the innovation process. As you test out new ideas, some will fail. Fear of failure can stop innovation in its tracks — in a work setting, people are afraid of what failure might mean for their performance scores, compensation, and even job security.

Despite knowing that innovation requires an environment where people feel safe to speak up and take risks with new ideas, organizations often, intentionally and unintentionally, discourage risk-taking rather than encourage it. Amy Edmondson, a researcher of psychological safety, interviewed several executives about the response to failure in their organizations. These executives acknowledged that failure rarely results from direct, blameworthy actions; on average, the group estimated that 2-5 percent of failures in their organizations were truly blameworthy. Yet the same group estimated that 70-90 percent of these failures were still treated as blameworthy.

You’ll need to figure out what your organization’s tolerance for failure is, and different areas may have different appetites. Every quarter, Google’s leaders review their performance against set objectives and key results (OKRs) in front of the whole company. More often than not, teams don’t hit their goal 100 percent, but aren’t ashamed to share details of their progress and missteps. Leaders regularly explain why they didn’t fully achieve their stated goals, what they’ve learned, and what they plan to do next to move forward. Modeling failure in this way sends a powerful message to everyone in the company that it is OK to fail so long as you learn from it, share what you’ve learned, and make plans to do better.

Googlers have adopted a few practices to learn from failures. Sometimes, before a project even begins, teams come together to talk about all the possible ways a project could fail. This exercise, called a “premortem,” was popularized by Gary Klein in 2007. This type of discussion helps to normalize failure by talking about it openly and, importantly, can provide the benefits of learning from failure while avoiding the pain of actually failing.

Similarly, at Google, when a project launches or if there’s a major service disruption, teams will come back together to talk about how things went. This “postmortem” exercise is all about having an open and honest conversation about what went well, what didn’t, and what the team could do to improve. Some teams have even gotten in front of the entire company to share a project’s postmortem analysis. Failure is a data point from which the entire organization should learn.

Use the tools below as a general framework to get started with your team and customize the content to make it more useful for you.

An organization’s ability to innovate is also tied to social connections, especially across disciplines. Research has found that groups with a diversity of perspectives have been shown to outperform groups of like-minded thinkers, in terms of overall performance and especially when solving complex problems.

One of the biggest barriers to innovation is internal resistance to a new idea. Google recently partnered with researcher Spencer Harrison to study how ideas from new employees end up sticking. The study found that good ideas from new employees usually didn’t get very far. But when a new employee partnered with a seasoned employee, their good ideas were more likely to develop into something meaningful, thanks to the extra context, support, and connections of the seasoned employee. To bring more of these overlooked ideas to light, think about how you can help your employees connect with one another.

To encourage and surface interdepartmental connections, any Googler can recognize another Googler with a peer bonus, with the approval of both managers. A peer bonus is a small cash award and includes an email where the nominator can make sure other team members or any Googlers can see the recognition and chime in with their own notes of gratitude.

Peer feedback is another great way to build connections. Googlers receive peer feedback as part of their performance reviews each year, and are encouraged to give and solicit feedback year round with the help of a simple real-time feedback tool. Constructive feedback from others — if given as suggestions rather than mandates — can have a positive impact on creativity which can lead to innovation. This kind of emotional support and constructive feedback is more likely to occur in environments where people feel safe taking risks with one another without fear of punishment or embarrassment.

Leaders play an important role in shaping an innovative environment. Whether you are an executive or a manager of a small team, your managerial style influences how those around you experience their work. Teresa Amabile, a leading researcher on creativity, offers managers six ways to avoid unintentionally stifling creativity.

1. Don’t default to assigning tasks based on availability. Instead, match people with assignments that provide just the right amount of stretch. Give them tasks that play to their strengths without boring them, and which don’t feel so out of their reach that they feel overwhelmed.
2. Set goals for your people, then get out of the way. Give your people the freedom to figure out what approach to use. Managers often fail to define goals clearly before handing over the reins, or they offer freedom but already have the “right” steps in their heads and end up micromanaging.
3. Avoid false deadlines. Time and money are two important tools that managers can use to support creativity; deciding how much of each to give a person or team can be tricky. Managers can kill creativity with arbitrary deadlines but may also miss out on the chance to increase intrinsic motivation with some healthy time pressure. It’s a similar balancing act for money.
4. Don’t stick to the same agreeable team. It may be tempting to assemble a group of people with similar working styles — especially if it means avoiding any type of interpersonal conflict — but research tells us that homogenous groups often fall prey to groupthink and don’t engage in as much creative thinking as groups with a diversity of perspectives and backgrounds.
5. Check your critical attitude. How do you typically respond to a new idea? If team members see your skepticism whenever a new idea is presented, or if new ideas that fail don’t get the same praise and attention as successful efforts, they will be less motivated to speak up about their ideas.
6. Discourage silos, politics, and gossip. These things distract from the real work at hand and kill creativity. Instead, find ways to build a sense of shared vision and to encourage connections between teams. Consider requiring teams to share information and collaborate, not just encouraging it.

There is no one way to make innovation happen in an organization. Remember that your actions send a signal and influence the way your teammates experience and understand their work. If you empower people to own their ideas, take risks, and reach across boundaries, chances are they’ll be more innovative.