Innovation Is Not a Democracy, and Other Thoughts

“We’re not a socialist environment, let’s be clear on that,” says Joe Gustafson, CEO and founder of Brainshark, a company that provides on-demand, rich-media solutions.  

I’m talking with him about innovation, because I think he must have some insight into the subject. Started in 1999, the VC-backed Brainshark last year grew 52 percent in sales and in the first half of this year the growth rate has been 84 percent, he tells me. They have a patent on their base application (which I’ll be writing about soon), they have three patents pending on applications that have grown out of the first (which essentially is a web-based application to create, share and manage online presentations that combine voice, text, graphics and business documents). In other words they are innovating.

“You must foster creativity and innovation and encourage people to make suggestions, but at the end of the day someone has to make tough decisions,” he says, when I ask how he balances creating a culture of innovation, which seems to rest on making everyone feel that they matter, that their ideas are welcomed, that they are free to experiment and innovate.  It all sounds very democratic.

Until the nos and unpopular decisions, which tend to put a kibosh on that misconception. That to me, seems to be the struggle: As a leader how do you create an environment that encourages an “anything is possible” flow of ideas and spirit of creativity on the one hand while balancing structure and top-down decision-making on the other.

“That’s part of leadership,” Gustafson says. Innovation is very much about creating the right conditions with the right leadership.

He has a number of ways he does this; here are a few.

Spend a lot of time and effort thinking about how to create a culture of innovation. For example, software-as-a-service, on which the company is based, is a very new model, Gustafson says. This is a whole different world from million-dollar contracts, he says, efficiency is key. He told me that’s especially true in the area of sales, he says, a demand which led to Brainshark assigning new sales, renewal and expansion to separate groups.

Believe that ideas can come from anywhere and from anyone. This is something I hear again and again from those focused on innovation. “Ideas come from everyone,” Gustafson tells me, and a lot of innovation comes from places you wouldn’t expect—wikis,  social networks, all parts of the company, etc.—you can get the best ideas from crazy places but you have to be open to that, you can’t  micromanage.” Which brings us to the next point.

Communicate your vision, then give employees space to create. Gustafson says he focuses on providing vision, direction, and resources, then lets people throughout company at all levels use creativity to solve problems. “I try to make sure the vision is communicated well and frequently and is clearly understood in all areas of the company,” he says. “From there you just sort of let people go, you must empower them to act on the vision and try out new things, which is not an easy thing to do.”

What he’s saying is that ideas need space to grow and bloom. This is really important I think, it’s hard to innovate and create when you feel like someone is looking over your shoulder. Probably everyone understands this when they think of wanting their own freedom to create; giving that space to others, for many, can be a bit more challenging.

View mistakes as learning tools. “Some things won’t work,” he says, “If it doesn’t work we hunker down and try to fix it.” This point, like the second, seems to be a defining characteristic of the innovative mindset. Earlier this year at the Cutter Consortium Summit, I watched a film by Robert Austin, Cutter fellow and Harvard Business School professor, which profiled a number of innovators.

One striking characteristic of each was the way he or she looked at failure. Of course, nobody wants to fail, but what was so interesting to me is that each interviewee (top-notch artists, engineers, designers and such) resolutely refused to even allow the word fail into his or her vocabulary. The interviewer would ask questions like “How did it feel when such and such project failed?” or “What do you do when a project fails?” Faced with a question that contained this foreign word, failure, you could see interviewees literally shake off the word, a nonverbal, “No I’m not letting your view of it stick to me.” Instead, they would answer the sentence starting with “I learned…” followed by a “Now I know that…” or “Now I know to try…”

I think of this when speaking with Gustafson. “It’s OK to make a mistake and fail,” he says. “I’d rather have employees try and make a mistake than not try at all.” I like that. Even hearing those words helps my shoulders lower a bit, allows me to breathe, and I can see how that mindset would be so freeing, instilling confidence and self-esteem in employees, rather than fear, timidity or self-doubt that can accompany environments that (for whatever reason) pulse with high-stakes and repercussion.

Put systems in place to monitor progress. Yes, it’s true that you need to allow breathing room for ideas and innovation, but let’s face it, it’s not like tossing the dice and being fine with whatever comes up is a reality for any company. How do you balance acceptance of failure with the reality of the need to be successful and make money? For Gustafson, part of the answer lies in appropriate monitoring. “[Innovation] is hard to do because you constantly have to be communicating and you have to let people make mistakes, but you also have to be testing and monitoring,” he says. “You have to be able to measure it and have an indication of whether this is or isn’t working. If it’s not working, you try and figure out why and take corrective action.”

What he’s saying is that yes, you do create a haven for ideas, an environment where people won’t be shot down for saying or doing the wrong thing, an environment that gives folks a reasonable amount of time to try something out (the opposite of micromanagement). But you don’t let the new processes, new ideas, or similar continue on their merry way without looking to see how they’re doing. You need to set milestones or appropriate points of time or development to check-in. And as he said, if something’s not working, you need to correct the situation.

Let the spirit of collaboration and respect for others guide your actions. At the end of the day, it is Gustafson who is the primary person judged on the revenue and success of the company, and therefore responsible for final decisions. Here as in all things, communication is key. “Not everyone will agree with all of the decisions you make,” he says. Still, “you have to be up front and tell people why [you made a certain decision] and why you believe this [is the right course of action], you constantly have to sell your ideas.” And perhaps most importantly, you have to admit it if you make a mistake, he says. (He’s not from the “pretend to be perfect” school of management.)

Innovation may largely be about fostering innovation with the right leadership, but many of those principles can seem a bit contradictory. Let go, but measure. Don’t micromanage, but make tough decisions. Encourage, but put the breaks on when necessary. Promote the “we’re all in it together spirit,” but remember that I the leader have the final say.

What gives?

Each person I’ve spoken with who takes the job of innovation as a core function of his or her job shares something fundamental: Respect for others at whatever level they might be—be it intern, entry- or mid-level employee, management or board member [Gustafson, for example, extends his views of collaboration up].

Without employees, there is no company, there is no innovation. Gustafson says he thinks of it like this: “Everyone is part of solution, not part of the problem.”