5 ways product leaders can create a culture of innovation

Hey, just be innovative okay? Be innovative and drive product-led success.

Sounds simple. But it really isn’t, is it?

Because how exactly do you drive product innovation? How would you deliver a culture of innovation that’s continuous? And how do you embed this into your product team and organization, so that you can build and take products to market that actually generate revenue and deliver services?

Well… it can start from the top. Senior product leadership can ensure teams work beyond a few ideas and help foster a truly creative culture that turns innovation into a strategic, guiding principle that connects to every part of the organization. And here are five ways to do just that…

#1 - Use trust to empower product teams

No organization can be truly innovative without creating a culture where every team member feels they have some level of autonomy - to think on their own and find fresh ways to solve a problem.

It takes a strong leader to know that not every great decision is done solo. Innovation is all about the team and leading that team effectively takes being able to listen, mentor, and in turn - empower.

A strong product organization has teams that exist for very different purposes, but they all must serve the customer in ways that meet the goals and needs of the company. Recognizing this can have a significant impact on how teams work, their morale, their motivation. And can lead to higher levels of consistent innovation, which brings greater value for customers and for the whole organization.

Teams that are truly empowered will not only solve the toughest problems, they’ll innovate much more effectively. But have the vast majority of orgs been convinced to empower their product teams in any meaningful sense? If not… why not?

Well, it comes down to a question of trust. When leaders don’t fully trust their teams, this can lead to a culture where they feel the need to explicitly direct them. Usually, this comes from a feeling that they don’t have the right level of talent within the team. Either because they can’t find said talent or they can’t attract the people they really need.

But looking at things this way only limits the people they have within the teams and proliferates the myth that the pace of innovation is only governed by the most talented geniuses out there. Sure, some are better at generating fresh ideas than others, but great ideas can come from just about any corner of your organization, at any time, as long as they’re given the space to grow.

So it’s important to trust in your teams and foster an environment where:

Team members are allowed the opportunity to be ambidextrous system thinkers, who want to solve the problems that matter.
Everyone’s ideas are welcomed, regardless of their specific role.
People are constantly encouraged to push for improvements and apply their observations and experience to problems.
Ideas are quickly tested, validated, and built upon effectively.

#2 - Encourage quick action on ideas

To help cultivate a culture of innovation, product leaders must be willing to move past continuous conceptual chatter and encourage quick action on ideas.

Of course, that’s not to say every idea should be taken straight into prototyping, but you must take the time to assess every idea, gather insights and data to make the most informed decision. But don’t stay in this phase for too long. It’s important to stay agile, to eventually stop deliberating, stop planning - and start taking action.

Make key decisions in a way that’s confident and measured, without any more downtime than is absolutely necessary. These decisions don’t have to be final, after all, rough prototyping is okay as long as it conveys where you’re going.

What starts with intuition can be fueled by insights, so listen carefully after you’ve taken action on ideas. If the feedback is telling you to “go back to the drawing board” this shouldn’t be seen as a negative, it should be seen as an indicator that you’re evolving and finding out what works. The final output will be better as a result.

#3 - Measure your innovation approach

No matter your product or service, data always matters. But how exactly do you measure ideas? Can you really measure something that intangible?

Well… yes. As long as you know and understand what you’re going to actually measure.

Undoubtedly, you’ll need numbers on user activity, engagement, and churn, etc. But how about using innovation metrics to understand what your users really want? Or understand how much time product management teams are actually dedicating to discovery?

Look at how many team members have actually been trained on what it means to innovate and pinpoint what can change the game for the org, and begin to build your approach to innovation metrics from there. Remember, start the spark of innovation with imagination, but always fuel it with data. Data can either back up your instincts or prove them totally wrong.

Take measured steps, such as:

Foster idea generation based on user studies and research; from in-depth interviews to focus groups.
Build product concepts based on specific user needs and ensure they resonate with the broader landscape by conducting competitive analysis.
Utilize a user segmentation process to paint a clearer picture of your target market, to push the right concepts forward into the final product.
Validate and prioritize ideas through testing and refine them by developing prototypes to put into a formal product development process.
Always incorporate usability testing to iterate further.

#4 - Don’t focus on the fear of failure

The fear of failure can haunt even the most intrepid of product enterprises. But failure is all part of the plan when it comes to innovating.

It’s inevitable when you’re fostering a culture of innovation, and it’s important to embrace it. Striving for product innovation is a continual process. It requires incremental testing and refining to truly understand what’s working and what isn’t. And there’s almost always a degree of uncertainty involved.

Shaking off the fear of failure and taking risks can actually lead to knowledge, breakthroughs, and growth. Look at when Google launched “AdSense” and “Google Answers” for example, both were fresh new concepts, but AdSense grew into a huge success, whereas Google Answers (which let their target audience post questions and pay an expert for the answer) was retired after just a few years.

But without a doubt, Google learned a lot from this, and could then apply the knowledge gathered to the development of future products, instead of missing opportunities as a result of being afraid to fail.

It’s obviously important to avoid taking an inappropriate risk, but the culture of your product org needs to be aimed at providing a balanced assessment that avoids prematurely rejecting ideas due to an overestimation of risk.

A lot of product ideas won’t be any good and should be allowed to die... in a nice, positive way! But only after you've explored them. You have to fail.

Failure is success because failure means that you've learned something, you've made decisions, you've progressed your thinking in the space. Product leaders need to provide emotional support to those willing to try something new, regardless of whether the idea is eventually judged good enough to turn into a successful product or not.

#5 - Plan for the future by learning from the past

According to Accenture’s US Innovation Survey, 60% of companies admitted they did not learn from past mistakes in relation to their approach to innovation. 72% of orgs admitted to missing opportunities to exploit underdeveloped areas.

Product leaders must take the necessary time to learn from past mistakes. Innovation isn’t just about continuing to do new things. The best type of innovation involves stopping some things that you're already doing, instead of just adding more and more to the work stack.

Fix what isn’t working while moving forward. As mentioned, failing should always be seen as something important to the process - but complacency with failure should not be encouraged. Before you decide to move forward, get a clear understanding of what your goals are for product innovation.

“Live as if you were to die tomorrow. Learn as if you were to live forever.”

The famous quote from Gandhi himself is of course still relevant today, especially when it comes to fostering a culture of innovation in your product organization. It’s important to stay adaptable and remain open to learning through looking at new ways of working and staying relevant in a constantly changing environment.

But you should also take a look back at what has come before, and use this to capture the context of what you’re planning to do moving forward. Look at the outcome you want to achieve, so you can have that artifact to keep referring back to at the right stop gates and the right stages. Always make sure your product teams are checking themselves against what they're setting out to do, all the way up until the product launch and beyond.

Embrace this non-linear way of thinking for continuous innovation to work. This way of thinking can also act as a trigger point to put data, user insight, or people together on a day-to-day basis.

Whether it’s looking back on a discussion with a competitor or supplier, a chat with another player while conducting market research, a look into some user research, or talking to a user; these can all serve as opportunity points for somebody in the teams or yourself to reflect on as you move forward.

It's not all about the data, it's not all about the UX. It's more serendipitous. It's having the space to think broadly, look at the bigger picture, and bring people together from every corner of the organization.

Join an exclusive network of Chief Product Officers in New York on March 18, 2025. Address challenges in scaling strategy, aligning teams, and driving innovation—and leave with actionable insights to elevate your leadership

Apply now to get your free invite.