Innovation needs a “challenge vs. threat” organization culture

Today (March 16, 2011) Karim Kassam (then of Carnegie Mellon University and in 2021 at Jacksonville Jaguars) talked  about challenge vs threat  and measuring stress in the lab through blood pressure , heart rate etc. at  the Yale SOM -Behavioral Marketing -Eli Seminar Series.  This got me thinking about the organizational culture you need to allow innovation. But first let’s differentiate between what we see as a challenge vs. threat.

[Note: This post from March 16, 2011 was updated and reformatted on May 31, 2021]

When is something a challenge  and when does  it become a threat? As this article mentions and Kassam clarified :

  • It’s a challenge if you feel that you have the resources and its only a question of “stretching” your effort,time etc. to the task  at  hand. Challenges are great because there are good chances of success and at both the individual and group level positive stress or eustress works to the advantage of  the mission.  Resources here could be money,materials but is that other magic ingredient which innovative companies are able to come up with. These include, a non-judgemental supporting culture where risk taking at the personal/group level is actively encouraged. You are allowed to fail at least a few times without being ridiculed or fired.
  • It’s a threat   when you don’t have  funding or materials but above all when you feel that the organization pulls   you down particularly if things don’t work out  a bit like the crab story. So people take “safe” bets, get only minor improvements while  real innovation remains elusive.

So it’s not only financial resources  that makes one organization more innovative than another. It is the organization’s  ability to frame  most problems as opportunities  that are seen  as challenges than threats by the internal folks.

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