So many organizations see freedom as a “problem” to managed when in reality, it is one of the keys to fostering innovation. Organizational bureaucracy may have made more sense during the Industrial revolution when the marketplace demanded scale, efficiency and repetition, but in today’s complex, rapidly changing marketplace, it only gets in the way of creativity and fresh ideas.

We agree with Ed Scanlan, CEO of the Chicago firm Total Attorneys, who asserts that personal freedom promotes creativity and risk-taking. According to an article at CNN Money, Scanlan’s firm encourages employees to take paid sabbaticals, with the understanding they’ll do something outside the bounds of their professional life, like making art or playing music. They come back work refreshed and full of ideas.

Other ways to inspire innovation:

What might be seen as “wasting time” — by reading widely or cultivating a diverse wide circle of friends or traveling to unusual place — can actually help you see things in different ways.

Develop curiosity. Look behind walls to see what is holding them up before you start knocking them down. Resist the temptation to quickly proffer your own point of view, and ask questions about how others see things, and where their thinking comes from.

Get out of the office once in awhile. Do something you wouldn’t normally do — see a play, go bowling, try an ethnic restaurant, watch a skateboard competition. While you’re spending time outside your comfort zone, it’s fertilizing your brain, making it more likely that ideas will sprout.

Encourage risk-taking, and look for what can be found in the rubble of failure. Thomas Koulopoulos, author of the Innovation Zone, emphasizes that small failures will pave the path to big successes. "You need to give people the license to take risks and to fail often enough to realize that they will not be punished for doing the right thing, even though the outcome might not be what they expected," says Koulopoulos.

Who are you hiring? Maybe the perfect candidate isn’t the one with the exact experience and skill set you think you need. Look for people with unusual backgrounds, who will bring fresh perspectives to the business.

Look for ways to convene the large group for cross-fertilization. Too often meetings are held horizontally – with work teams — or vertically, with a room full of managers or one specific function. Bring together a large cross-section of the organization to solve specific business issues in real time. And for extra spice, invite a few rogue outsiders — the director of a children’s museum, someone who runs a yoga studio, or a garage mechanic.

Innovation can be sparked by many things, but it’s rarely found by doing the same old thing, over and over again. Chaos and uncertainty might feel uncomfortable, but will lead to the adaptation and innovation necessary for survival.

One way to diagnose whether your organization is maximizing its potential is to answer this question: How are mistakes viewed and dealt with?

Are they feared for the negative consequences that will be rained on someone’s head? Are they furtively hidden to avoid exposure?

Or are mistakes celebrated as learning opportunities? Are those who risk and fail applauded for a “good try that didn’t work?”

As we’ve written about many times, organizations that center their conversations on “holding others accountable” are sending employees a strong message that they should do as their told. That might get employee compliance, but it won’t unleash the diversity, creativity, and independent decision-making that could strengthen the organization and foster innovation. “Compliance” by definition requires conformity, which discourages risk-taking and critical-thinking skills, which are essential for developing superior results.

Research done by Jennifer Lerner of Carnegie Mellon University and Philip Tetlock of Ohio State University has shown that many employees base their performance decisions on gaining the favor of those to whom they are accountable — typically supervisors — rather than thinking through what the business and its customers really need. Sheena Iyengar, in her recent book, The Art of Choosing, points out that organizational systems designed to “hold others accountable” stifle freedom and encourage people to do less than they are capable of, which stifles innovation.

For example, an employee who is tempted to bend rules to better serve a customer might choose instead to doggedly follow company policy for fear of being discovered by the supervisor, who has the ability to influence rewards and punishments. They don’t want to be seen as “making a mistake” when it could influence their rewards (approval, benefits, salary) or avoiding punishment ( betting yelled at, a bad write-up, a negative performance evaluation).

What’s the alternative? One of them is to embrace, celebrate and be grateful for mistakes. Vineet Nayar, author of Employees First, Customers Second: Turning Conventional Management Upside Down asserts in a recent blog posting that there is “growing evidence to suggest that innovation flourishes when people are given the space to make mistakes.”

Why? Because if people aren’t making mistakes, they are not learning. And if employees aren’t constantly learning, the organization is stagnating. Stagnation is a dangerous environment for organizations that want to survive in a rapidly changing marketplace.