CHAPTER 11
Creativity, Innovation, and Leadership
The purpose of this chapter is to assist readers in developing the creative problem-solving approach
required to be an effective leader.
CHAPTER OUTLINE AND LECTURE NOTES
Creative problem solving is an important requirement for effective leadership at every organizational
level. The role of a creative leader is to bring into existence ideas and things that did not exist
previously, or that existed in a different form. Innovation refers to creating new ideas and their
implementation or commercialization.
I. STEPS IN THE CREATIVE PROCESS
An important part of becoming more creative involves understanding the stages involved in
creativity, the production of novel and useful ideas.
Step one on creativity is opportunity or problem recognition, in which the person discovers that a
new opportunity exists or a problem needs resolution. Step two is immersion, in which the indi-
vidual concentrates on the problem and becomes immersed in it. Step three is incubation, in which
the person keeps the assembled information in the back of the mind for a while. Step four is
insight, when the problem-conquering solution flashes into the mind at an unexpected time. The
aha moment usually arrives after hours of thought and study. Step five is verification and
application, when the individual sets out to prove that the creative solution has merit.
II. CHARACTERISTICS OF CREATIVE LEADERS
Creative leaders, like creative workers of all types, are different in many ways from their less
creative counterparts. Creative leaders challenge the status quo and are flexible enough to
overcome the traditional way of looking at problems.
A. Knowledge. Creative problem solving requires a broad background of information, including
facts and observations. Being creative often involves combining two or more things in a new
and different way.
B. Cognitive Abilities. Creative problem solvers tend to be bright rather than brilliant. (Yet
when the creativity centers on highly technical matters, the creative person is often brilliant.)
C. Personality. Creative people tend to have a positive self-image without being blindly self-
Chapter 11: Creativity, Innovation, and Leadership107
D. Passion for the Task and the Experience of Flow. A dominant characteristic of creative
people is a passion for their work, or high intrinsic motivation. Passion for the task and high
intrinsic motivation contribute to a total absorption in the work and intense concentration,
the experience of flow.
III. OVERCOMING TRADITIONAL THINKING AS A CREATIVITY STRATEGY
Creative problem solving requires an ability to overcome traditional thinking. The creative person
IV. ORGANIZATIONAL METHODS TO ENHANCE CREATIVITY
Here we describe several creativity-enhancing methods, including a review of brainstorming. The
leader plays a dual role in implementing creative problem-solving techniques: facilitating group
interaction and providing a fair share of creative output.
A. Systematically Collecting Fresh Ideas
1. Straightforward collection of ideas. A notable way of collecting fresh ideas is for
employees to furnish them to a company database, so when somebody needs a fresh idea it
2. Establishing idea quotas. To facilitate having fresh ideas, the leader/manager can
establish idea quotas, such as asking staff members to bring one new idea to each meeting.
3. Make whiteboards regularly available for sketching ideas. A wide range of
4. Granting tinkering time .A formal policy approach for collecting fresh ideas is to
allocate an amount or percentage of time for employees to think and experiment. Both
Google and 3M have restricted tinkering time a little but the concept remains.
B. Brainstorming
Brainstorming is the best-known method for creativity improvement (as well as for creative
problem solving). To encourage creativity during the idea-generating part of brainstorming
potential solutions are not criticized or evaluated in any way. Brainstorming can include
C. Using the Pet-Peeve Technique
The pet-peeve technique is a group method of identifying all the possible complaints others
might have about one’s organizational unit, thus improving service. Through brainstorming,
group members develop a list of complaints from anyone who interacts with their group. No
D. The Morality of Enhancing Creativity
Gerald Sindell emphasizes the need for creative workers to place their work in a moral
context. Every idea and product has potential harmful consequences in minor and major
ways. An example would be the many unintended negative consequence of smart phones
V. SELF-HELP TECHNIQUES TO ENHANCE CREATIVE PROBLEM SOLVING
All creative problem-solving techniques aim to increase mental flexibility. The six strategies and
techniques reported here supplement the organizational programs described previously.
A. Practicing Creativity-Enhancing Exercises
An established way of sharpening creative thinking is to engage regularly in activities that
encourage flexible thinking. Among such activities are creative photography, asking
Chapter 11: Creativity, Innovation, and Leadership109
B. Staying Alert to Opportunities
The ability to spot opportunities that other people overlook characterizes creative leaders.
Opportunity seeking is associated with entrepreneurial leadership because the entrepreneur
might build an organization around an unmet consumer need.
C. Maintaining an Enthusiastic Attitude Including Being Happy
Creative thinking calls for a positive attitude. Yet a leader must sometimes be judicial (or
D. Maintaining and Using a Systematic Place for Recording Your Ideas
Creative ideas can lead to breakthroughs for your group and your career, so they deserve the
E. Playing the Roles of Explorer, Artist, Judge, and Lawyer
Be an explorer by getting ideas from people in different fields. Be an artist by stretching
your imagination, which includes asking what-if questions. Be a judge by critically
F. Engage in Appropriate Physical Exercise
Engaging in physical exercise is a well-accepted method of stimulating creativity. The
VI. ESTABLISHING A CLIMATE FOR CREATIVE THINKING
In addition to being a creative individual, a leader must establish a climate conducive to creative
problem solving. A foundation step for fostering organizational creativity is to establish a vision
and mission that include creativity. The leader also needs the right organizational culture, and
extensive use of the techniques described in this chapter.
A. Leadership Practices for Enhancing Creativity
Nine leadership and managerial practices are particularly helpful in fostering creative
thinking.
2. Intellectual challenge. Stretch people intellectually without overwhelming them.
3. Empowerment Including the freedom to choose the method. Research in China
4. Ample supply of the right resources. Time and money are the most important resources
5. Effective design of work groups. Work groups are most likely to be creative when they
6. Supervisory encouragement and linking innovation to performance. Developing a
7. Organizational support. The entire organization as well as the immediate manager
8. Have favorable exchanges with creative workers. A study with 191 research and
9. Give financial rewards for innovation. Creativity is self-rewarding to some extent
because it is so exciting. Nevertheless, financial rewards for contributions to innovation
help sustain a climate of innovation. Financial rewards for creativity are widespread in
industry and universities.
B. Methods of Managing Creative Workers
Choosing effective methods for managing creative workers is also important. Suggestions
are as follows:
1. Give creative people tools and resources that allow their work to stand out.
3. Give gentle feedback when turning down an idea.
4. Employ creative people to manage and evaluate creative workers.
VII. ADDITIONAL LEADERSHIP PRACTICES THAT ENHANCE INNOVATION
2. Continually pursue innovation.
4. Emphasize collaboration among employees.
7. Integrate development and production.
VIII. GUIDELINES FOR ACTION AND SKILL DEVELOPMENT
Being perceived as creative could have a downside in terms of being promoted. The imaginative
person who wants to climb the leadership ladder should frequently remind others in a subtle way
that he or she is business oriented.
COMMENTS ON EXPERIENTIAL EXERCISES
Leadership Self-Assessment Quiz 11-1: The Creative Personality
Test
Based on experience with thousands of students, we believe that this quiz contributes to assessing a
person’s current level of mental flexibility and creative attitudes. We doubt that a person with good
self-objectivity who scored high on this test would fail to have strong creative tendencies.
Leadership Skill-Building Exercise 11-1: Choose an Effective Domain
Name
A fascinating feature of this brainstorming exercise is that some people are making enormous sums
of money by having either developed domain names or bought the rights to others. Group leaders
who report their team’s brainstorming solutions are often disappointed to find that other class
The Next Billion Dollar Brand part of the exercise is also has heavy applied value. Worth noting is
whether a person who thought he or she really had a good idea for the next billion dollar brand
would be willing to share the idea.
Leadership Skill-Building Exercise 11-2: The Pet-Peeve Technique
The pet-peeve technique is both an exercise in creative problem solving and an opportunity to use a
technique for improving customer service and quality. Students may require some prodding to come
forth with humorous or exaggerated criticisms of their organizational unit.
Leadership Skill-Building Exercise 11-3: The Multiple Uses
Technique
This classic creativity exercise still has value, and was used a couple of years ago in a Staples
Leadership Diagnostic Activity 11-1: Assessing the Climate for
Innovation
Students with significant work experience will find this questionnaire the most meaningful. However,
relating the questionnaire to school experience can also be enlightening.
Leadership Skill-Building Exercise 11-4: My Leadership Portfolio
A highly practical outcome of this portfolio exercise is that it results in recording innovative ideas,
reinforcing one of the self-help suggestions made in the chapter. The portfolio activity is also useful in
sensitizing the student to the importance of being mindful of opportunities to be creative.
Leadership Skill-Building Exercise 11-5: The Multimedia
Presentation
COMMENTS ON DISCUSSION QUESTIONS AND ACTIVITIES
1. Give an example of creativity in business that does not relate to the development or marketing of a
product or service.
Most students will have to stretch to find a suitable answer to this question, because products
2. Is it important leaders to be creative and innovative? Or, should they simply hire creative an
innovative group members?
3. Assume that you are the leader of the paperclip manufacturing division of a company. Do you
think it would be worth your time and that of your group, to attempt to improve the design and
intended use of the paperclip?
The design and use of paperclips has remained stable for many years, but who knows when a
disruptive design will emerge? It is therefore probably worth some time to spend some research
4. In what way does your present program of study contribute to your ability to solve problems
creatively?
Almost any program of study facilitates the student’s amassing a base of useful facts that might
later serve as the database for creative thought. In addition, some programs of study offer ample
6. The opinion has often been expressed that too much emphasis on teamwork inhibits creativity.
What do you think of this argument?
The argument that too much teamwork inhibits creativity is sometimes true. Attempting to satisfy
the demands of teammates can often mean not pushing forward with an idea of one’s own. A good
6. Why do so many people believe that if you emphasize being efficient, such as using the quality-
improvement process Six Sigma, creativity and innovation are likely to suffer?
A process like Six Sigma emphasize many routines that appear in opposition to the flexible
thinking required for creativity. Among these routines are the collection of large amounts of data
7. Several people have written that Twitter is one of the most creative developments in the history
of business and the world in general. What is your opinion about Twitter as a powerfully creative
development?
114 Chapter 11: Creativity, Innovation, and Leadership
8. What do you think the next creative breakthrough in business will be that will rival e-commerce
and mobile phones in importance? (Loads of product planners and business leaders are waiting
for your answer.)
The student who has a plausible response to this question might not want to share the idea, but
instead might want to capitalize on the breakthrough idea. Many high-tech companies, including
9. Assume that you are convinced that creativity is a legitimate part of a leader’s role, what percent
of your working time do you think you should invest in creative thinking? Explain your reasoning.
10. Speak to the most creative person you know in any field, and find out if he or she uses any
specific creativity-enhancing technique. Be prepared to bring your findings back to class.
Brainstorming is used so frequently that most of the people polled for answers to these questions
PLAUSIBLE RESPONSES TO CASE QUESTIONS
Leadership Case Problem A: The Rapid Cash Store Needs Ideas
This case illustrates how creative problem solving can be necessary for the survival of the firm, and
at the same time how difficult it can be to find the ideas being sought.
1. To what extent do you think it is Sam’s individual responsibility to furnish creative ideas for
generating new business for The Rapid Cash Store?
2. In response to Greg’s comment, where should the management team look for creative ideas
for enlarging the revenue of The Rapid Cash Store?
3. From the standpoint of ethics, do you think the Rapid Cash Store should stay in business?
Explain your reasoning.
The values and assumptions of the student will lead to the conclusion about the merits of The
Rapid Cash Store as a contributor to society. It is an easy argument to say that payday lenders
charge usurious interest rates, and prey on poor people. Yet many Rapid Cash customers do
Associated Role Play
This role play will encompass several important concepts: participative leadership, the leader as a
problem solver, and brainstorming. Representative ideas for new sources of revenue include selling
prepaid phone service at the stores, and lending money small enterprises.
Leadership Case Problem B: “How Can We Enhcourage a Few
Disrupters?”
A key theme this case illustrates is whether leadership can force creativity among group members.
The case also illustrates that the future prosperity of a firm might depend on innovation in the form
of disruption.
1. What do you recommend that leadership at Luxury Design do to facilitate having a
disrupter within the company?
2. What thought should Arianna and the other members of the leadership team at Luxury
Design give to going beyond the confines of the office-furniture industry in order to be a
disrupter?
3. In what way is this case about creativity and innovation?