Inside business: Set them free to innovate

INNOVATION and enterprise have lately become not just watchwords for managers of increasingly hard-pressed corporations, they have also spilled over into the lexicon of the politician. And no one more so than Gordon Brown, whose recent pre-Budget report was full of this sort of language.

The problem, as any manager will tell you and Mr Brown will doubtless soon discover, is that it is a lot easier to talk about it than to make it happen.

Now, we all know about this government's fondness for reviews; there have been so many in the past year or so that most people have lost count. But the last thing we need is a study of what needs to be done to make British industry more innovative and enterprising - and so better able to plug the productivity gap that those nice people at McKinsey have discovered.

Given a few moments, many people could come up with the answers to that one, and they are included in numerous reports on the private sector over the years.

Sure, there are tools and techniques for improving creative thinking. But, mostly, it comes down to culture. And this in itself is problematic. Because, as Jerry Hirshberg, famed founder of Nissan Design International, writes in his book The Creative Priority (Penguin, pounds 18.99): "Current organisational models revolving around productivity and efficiency at any cost produce a corporate culture hardly conducive to thinking - much less innovative thinking."

But it is not just a lack of time. Employees in organisations that are noted for their innovation are not exactly lazing around; it is just that their efforts are better directed and, more important, they tend to know where their work fits into the scheme of things.

Even more important, they work in places where the fear of making a mistake is not paramount. Everybody is familiar with the notion of "command and control" and how it has supposedly been largely replaced by "empowerment" and localised decision making.

This is largely a myth. Even if senior executives have formally abandoned their "we know best" approach, their underlings have been so imbued with the spirit of it that it might as well be still in place.

It is still not hard to find employees filling out requisition slips in triplicate, largely because that is the way that things have always been done and it presumably feels a lot more businesslike than just going and getting what is required. This is the true challenge for business and the Government: finding a way to persuade companies and their employees that it really is more efficient to shake off the traditional restraints on operating.

Certainly, there will be risks and - as William McKnight, architect of the modern 3M, said - mistakes will be made. But the benefits should far outweigh the losses.

The difficulty, of course, is that changing the way in which you - whether chief executive or junior employee - behave is all about culture: that soft, squidgy thing with which companies have so much trouble.

This problem is compounded by the frequent suggestion that there is only one way of going about that. We are, for example, constantly told that change must come from the top. Or, as Leveraged Innovation, a book by a trio of academics just published by Macmillan, claims - "successful co-operation is the key to innovation".

Both are true, but so are many other edicts. For example, that trust, respect and environment are prerequisites. The truth is that this is a highly complex area and that what - above all - is required is an openness of mind.