Why a culture of experimentation drives innovation and business growth
There is nothing so stable as change, Bob Dylan is reported to have said. Business leaders are having to navigate their way through ‘unprecedented’ change and uncertainty with no previous example of how to tread this path. For organisations to thrive within this environment demands more than strategy – it requires continuous experimentation.
By encouraging teams to test ideas, learn fast and embrace change, companies gain resilience, innovation, and a lasting competitive edge.
This mindset must of course go beyond the leadership team. Regardless of role, department, level, market, industry or size, a culture of experimentation is something all organisations, all sectors and all people can benefit from, and that businesses need to thrive.
Research has shown as much: Harvard Business School (HBS) Professor Stefan H. Thomke writes that “an experimentation mindset is a clear driver of improved business performance”. He cites HBS research that shows that the stock performance of companies that have built a robust culture of experimentation has consistently outperformed the S&P 500 over the past decade. The names are no surprise: Amazon, Etsy, Google and Microsoft, among others.
But experimentation is by no means the remit of just tech companies. From clothing companies like Patagonia, who are famous for their purpose-led experimentation both in their products and their processes; to some of our charity clients, who are further ahead with experimenting with AI than lots of global organisations – experimentation is a powerful way of driving change for everyone.
What do we mean by experimentation?
At Kin&Co, we define a culture of experimentation as: “A place where people are encouraged to act, adapt, play, fail and learn.”
In organisations that have embedded this characteristic, teams feel empowered to:
Regularly test new approaches
Learn quickly from outcomes
Iterate based on data instead of relying on slow, top-down decision making
Much like how natural systems adapt to the changing environments around them, teams can respond faster to shifting challenges, and obtain the skills, habits and confidence to test new ways of working.
Where this mindset is missing, organisations get stuck in outdated processes and ways of working, lacking innovation both from a product and cultural perspective – often due to a firm-wide fear of failure, alongside organisational policies, processes, and rigid structures that inhibit experimentation.
What experimentation is not, is directionless or unstructured. Mistakes are important but experimenting requires structure, guidance and frameworks to be impactful and provide useful data that ensures every mistake is learnt from.
When does experimentation matter most?
With constant change comes the need for continual experimentation. However, there are key moments for organisations when it can be critical and mean the difference between success and failure.
For example, at a time of mergers and acquisitions to build trust and find common ways of working, or when restructuring, teams can use experimentation to establish new practices and behaviours, supporting their engagement.
New leaders can also use experimentation to explore and test new approaches before committing to them and the impact they may have (see more on how we can help you upskill and maximise the potential of your leaders).
At a time when digital transformations and sustainability initiatives hover under permanent question marks on leadership agendas, bringing experimental behaviours into an organisation can supercharge the move to adoption and improvement through testing ideas first, without the disruption of implementation.
What are experimental behaviours?
Experimental behaviours in business are practical habits and processes that actively encourage innovation – from testing new processes to learning from failures and iterating fast.
Any scientist will attest that no experiment is ever carried out once. And to keep trying and adapting to find new ways of working a determination is required, and one in which people are encouraged to have the curiosity and courage to keep trying different ways of doing things.
Experimentation requires a spirit of playfulness that organisations must embrace, but not without the humility to accept and be comfortable with the experiments that go wrong.
Underpinning successful experimentation is accountability, without which experimentation may descend into chaos without the constructive learnings of a successful – or failed – experiment.
Where does experimentation sit within culture?
In our Thriving Cultures™ model, we have identified ‘experimentation and agility’ as one of six key characteristics needed for an organisation and its people to flourish. And none of them sit in isolation. The beating heart of a thriving culture is a busy Venn diagram of mutually supportive overlaps.
Much like ecosystems in nature, such cultures show high levels of energy, adaptability, and collective effectiveness. They enable strong innovation, experimentation and resilience in an environment in which people feel empowered and with a strong sense of connection and purpose. All of this allows them to contribute meaningfully and navigate challenges well.
Want to check in on your organisation’s culture and see how experimental it is? Take our short Thriving Culture diagnostic for a thought-provoking perspective on how your organisation stacks up.