Innovation Is a Leadership Choice

By Frances Cairns and Chris Shipley

Too often—perhaps most often—business leaders think of innovation as a side hustle. It’s a project. A skunkworks. An initiative. An entrepreneurial venture. At best, a strategy.

No doubt that approach has worked for some companies, allowing them to cordon off higher-risk initiatives from their core business. This bet-hedging strategy seems sensible, but it, too, is fraught with risk when scarce resources must be allocated, new businesses integrated, and old lines retired. In these moments, leaders face Solomonic choices about which projects to feed and which to starve.

There is another approach—one that threads innovative practices into every aspect of the business. One that embraces innovation as a core competency and strategic advantage. One that puts innovation at the center of every business decision. For the leaders of these organizations, innovation isn’t an add-on or an afterthought; innovation is a leadership choice. 

Transformational leaders make the choice to run innovative businesses.

It sounds simple enough: just decide to be innovative. The reality, of course, is a little more complicated. We sifted through dozens of companies to identify the patterns that enable some organizations to mainstream and scale innovation while others stumble over even the simplest of projects. No matter the organization’s size or sector, we found that a handful of principles set the foundation of every company. These principles—and how you engage with them—determine the capacity, competencies, and capabilities of your organization to innovate. They identify resource gaps, surface conflicts, highlight unique talents, and uncover roadblocks that affect your ability to make innovation your competitive advantage. By understanding these principles and how to leverage them, you lay the groundwork for transformational leadership. They provide a roadmap for leaders who want to guide truly innovative organizations, highlighting the intangibles that influence whether innovation thrives or fails.

Consider risk, no doubt the third rail of innovation decision-making. Highly risk-averse organizations will favor their existing businesses, invest sparingly in unproven product lines, and quickly shut down projects that don’t deliver short-term returns. Risk-accepting organizations lean into new initiatives, even cycling through concepts in search of their next big thing. Neither approach is necessarily right or wrong, but if you’re not fully aware of the risk tolerance across your entire organization, decisions on what to try—or not to try—may become hopelessly misaligned with your company’s operational culture.

This scenario illustrates one of the intangible principles that leaders navigate daily. In our work with companies of all sizes, we identified 16 principles at play in all net-new product innovation practices. Some of these principles, like risk, are more obvious than others, like adaptability. No one principle alone defines an organization’s innovation culture or capability. Taken collectively, they identify the preferences and capabilities – the choices  - leaders tap to drive transformational efforts.

Aggregating years of learning, C\R Strategies developed The Innovation Navigation Styles Inventory (INSI) to help leaders understand how they naturally lead innovation by surfacing the preferred way they apply the 16 principles. For example, two leaders may both manage risk, but one does it through bold experiments, while another uses careful planning.

The principles naturally organize into four fundamental domains in the innovation journey—a route defined by choices and behaviors that shape your organization's ability to innovate. You might think of them as the underlying currents that guide your company’s capacity and capability to innovate. These four domains are Strategy, Creation, Scrappiness, and Growth.

• The Strategy Domain sets the direction, tone, and pace for innovation within your organization. It is how we see. Strategy involves choices about risk tolerance and strategic focus—decisions that influence your company’s culture and willingness to embrace change.

• The Creation Domain is the wellspring of creativity and idea generation. It is what we do. Creation encompasses how ideas are cultivated, developed, and transformed into actionable initiatives. This pathway is about fostering an environment where creativity thrives, and ideas can be rapidly executed.

• The Scrappiness Domain embodies your organization's resilience and tenacity. It is how we act. Scrappiness reflects how teams respond to challenges, constraints, and setbacks—turning obstacles into opportunities through grit and resourcefulness.

• The Growth Domain is the foundation for continuous improvement and adaptation. It is how we learn. Growth focuses on your organization's ability to learn from experiences and integrate those lessons into future actions, ensuring that innovation is a sustainable, ongoing process.

Understanding these pathways and taking a true measure of your innovation capabilities is fundamental to transformational leadership and the first step toward building a culture of continuous, mainstream innovation. By consciously navigating these intangible pathways, leaders can align their organizations with their innovation goals, creating a cohesive strategy that permeates every level of the business.

In essence, innovation isn't just about having the right ideas—it's about making deliberate choices along these pathways every day. It's about recognizing the intangible forces that influence whether innovation thrives or fails within your organization. By embracing these pathways, you can transform innovation from a side hustle into a core strength, driving sustainable growth and lasting competitive advantage.

Every leader has a distinct innovation style. C\R Strategy Partners created the INSI profiling tool to help leaders better understand the visible and intangible factors driving their decision-making. The INSI assessment helps you understand yours, including the less obvious principles that quietly influence how you think and lead. Get started here.