ABSTRACT
Two key elements which are essential for the effective management of innovation are organisational climate and culture. These are two distinct concepts which are often confused in the academic literature on the subject. Climate refers to the environmental factors (physical and psychological) within an organisation and include communication, trust, feedback and reward. Culture, on the other hand, involves the norms, values, beliefs and traditions of an organisation, which are often incorporated into the mission and vision statements and which constitute the philosophy and behaviour of the people who make up the organisation. The organisational climate and culture for the optimisation of innovation should also incorporate an idea management system. This chapter discusses those elements which are related to the application of innovation and to the process of innovation, discussed in the previous chapter. The chapter concludes by linking the value of culture and climate to the leadership of an organisation.
