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Developing a Culture of Innovation: Lessons Learned from Pixar’s Co-Founder

Ed Catmull

Whether we know kids who love these unforgettable stories or are a kid at heart ourselves, most of us are familiar with the Pixar Animation Studios’ greatest hits Toy Story, A Bug’s Life, Finding Nemo, Cars, and more. Pixar’s co-founder, Ed Catmull, took a sleepy graphics art studio and transformed it into one of Hollywood’s greatest success stories by embracing a culture of creativity and teamwork. Learn how you can use his lessons learned to develop a culture of innovation within your organization.


Behind every company’s success story is a great leader and innovator. A common thread that most innovators share, particularly in today’s business world, is that they surround themselves with a great team and cultivate an organizational culture that embraces creativity. Though his name is not quite a household name like that of Bill Gates, Steve Jobs, and Jeff Bezos, one of the most profound innovators of our time is the (now retired) co-founder of Pixar Animation Studios, Ed Catmull. Throughout his five-decade-long career, he has been interviewed extensively to share his vision and approach when building great teams.


Ed Catmull started his career as a computer scientist with a passion for animation. Early in life, he found inspiration in Disney movies, including Peter Pan and Pinocchio, and dreamed of becoming a feature film animator. Soon after graduating with his doctorate in computer science, Catmull was hired by the New York Institute of Technology, where he founded a 2D animation software that automatically produced frames of motion between two frames. He was later approached by George Lucas at Lucasfilm, where he created digital models of an X-wing fighter for Star Wars. In 1979, Catmull became the Vice President of Industrial Light & Magic, a computer graphics division at Lucasfilm.


In 1986, Steve Jobs acquired Lucasfilm’s digital division and founded Pixar. At Pixar, Catmull headed the teams that produced hits such as Toy Story, A Bug’s Life, Toy Story 2, Monsters Inc., Finding Nemo, and Cars. Pixar would later be acquired by Disney in 2006 and continued to produce hit films such as Ratatouille, WALL-E, Toy Story 3, Cars 2, Brave, and more.


Throughout the years, Ed’s leadership style and approach with teamwork have helped companies that he was a part of become the innovative success stories that they are known for. His experiences and philosophies are also highly regarded and widely shared in the business world, serving as a framework to replicate his level of success. From his book, Creativity, Inc., and interviews with Harvard Business Review and MIT Sloan School of Management throughout the years, we summarize our findings here to share his philosophy on how to build a creative and innovative culture within your organization:


People Are More Important Than Ideas – A movie contains tens of thousands of ideas. Creativity involves a large number of people from different disciplines, working effectively together to solve a great many problems. Getting talented people to work effectively with one another is equally as important. That takes trust and respect and must be earned over time. What leaders can do is construct an environment that nurtures respectful and trusting relationships. In turn, this unleashes everyone’s creativity. The result is a vibrant community of talented people that are loyal to one another.


“You get great creative people, you bet big on them, you give them enormous leeway and support, and you provide them with an environment in which they can get honest feedback from everyone.” – Ed Catmull, Pixar Co-Founder


Accepting Uncertainty -Don’t be afraid to say, “I don’t know.” With every role that Catmull took on, he says he never felt quite ready for the challenge, but he didn’t let doubt get in the way. “When I got to New York Tech, I was in over my head. When I got to Lucasfilm, I was in over my head, and when we started Pixar, I was really in over my head,” he recalled. To overcome this, Catmull was transparent about what he didn’t know. His management style was to surface issues and not bury them. “I looked at being in over my head as a feature, not a bug,” he said. “I don’t have anything to hide. I can admit to people that I don’t know, and in doing so, we can engage in discussions and talk about problems. What makes Pixar special is that we acknowledge that we will always have problems, many of them hidden from our view, that we work hard to uncover these problems even if doing so means making ourselves uncomfortable, and that when we come across a problem, we marshal all of our energies to solve it.”


Failure is Part of the Process – He also acknowledges that failure is sometimes part of the process. To achieve something unique and original, you must start with something unlikely, and that increases risk. At Lucasfilm, Catmull’s benchmark was to have a third of creative efforts be successful. This was a philosophy he carried over to Pixar, where a film might go through eight or nine creative rounds with roughly three months in between to massage the concept – or, in some cases, scrap it altogether. “New ideas that are thrown out at the beginning frequently fail, but because we expect it and everyone’s been through it, they aren’t thought of as failures,” Catmull said. The key is to create a culture and safe environment that encourages experimentation and failure and doesn’t punish failure. During feedback sessions, the teams have to acknowledge the vulnerability of people who are presenting and make it safe for them to be vulnerable.


Make it Safe for Everyone to Offer Ideas – On that same note, Catmull says they regularly showed works in progress during “viewings” and alternate which employees goes to which viewings to ensure there are always fresh eyes. Everyone in the company, regardless of department or position, gets to go to a viewing at some point. They made an effort to make it safe to criticize by inviting everyone attending the viewings to email suggestions to creative leaders that detail what they liked, what they didn’t like, and explain why.


Failing the Elevator Test – With creativity, take the legendary “elevator test”- the ability to pitch an idea to higher-ups in the time it takes to ascend to the executive suite. An idea you can pitch in a 30-second elevator ride isn’t likely to break new ground. “If you can pass that test, [your idea] is probably derivative of what’s been done before,” says Catmull. Ambitious, unlikely ideas — “a rat that wants to cook, or an old man who floats away on a balloon with a stowaway,” Catmull said — can’t be summed up in 30 seconds, but they can go on to become the Oscar-winning Pixar films “Ratatouille” and “Up,” respectively.


A Peer Culture – People at all levels support one another. Everyone is fully invested in helping everyone else turn out the best work. This was achieved in a few different ways, here we highlight two practical approaches:


    • The Brain Trust: This group consisted of directors and other leaders. When a director and producer feel in need of assistance, they convene the group (and anyone else they think would be valuable) and show the current version of the work in progress. This is followed by a lively two-hour give-and-take discussion, which is all about making the movie better. The brain trust brought together smart, creative people on a monthly basis to speak candidly about the company’s latest film, and if something wasn’t working, they were encouraged to say so and spare no feelings. Since they trusted one another, they could have very intense and heated discussions; they always knew that the passion was about the story and wasn’t personal. For leaders, it’s crucial to have a process in place so that your employees can speak candidly without the fear of recourse.


    • The Dailies: The practice of working together as peers was core to Pixar’s culture. It wasn’t limited to just directors and producers. During their daily reviews (or “dailies”), it was the team’s process for giving and getting constant feedback constructively. People were encouraged to show their work in an incomplete state to the whole crew. One of the many benefits of this approach was that it helped get people over the embarrassment of showing work still in process. Once they do so, they become creative. People can also learn from and inspire each other. Showing a highly creative piece of animation may help spark others to raise their game. Lastly, there are no surprises at the end. People’s tendency to make sure their work is “good” before they show to others increases the possibility that their finished version won’t be what the director wants. The dailies helped avoid such efforts.


Removing Barriers – Getting people in different disciplines to treat one another as peers is just as important as getting people within disciplines to do so, but it’s also much harder. Barriers include the natural class structures that arise in organizations. There are also different languages spoken by different disciplines and even the physical distance between offices. Barriers are impediments to producing great work, and therefore we must do everything we can to tear them down. One of the principles is that everyone must have the freedom to communicate with anyone. Members of any department should be able to approach anyone in another department to solve problems without having to go through the “proper” channels. Leaders and managers need to learn that they don’t always have to be the first to know about something going on within their realm and that it’s OK to walk into a meeting and be surprised. The impulse to tightly control is understandable, given the complex nature of most businesses. Still, the most efficient way to deal with numerous problems is to trust people to work out the difficulties directly with each other without having to check for permission.


Conflict Can Be Cathartic – Creating award-winning animated films demands both artistic and technological talent. As a high-profile chief executive, Catmull was constantly at the epicenter of managing the needs of two seemingly distinct groups. As a manager, he tolerated a relatively high degree of disagreement between teammates, as long as the conflict didn’t turn personal. “We can have people who can argue such that they turn red in the face, but it’s about the problem,” he says. “As long as it’s focused on the problem, then we get the best possible outcome.” “In solving difficult problems, you’re doing something original and creative,” Catmull said. “You’re giving something to the world, but you’re also sending an internal message about who you are as an organization.”


Carrying the Torch – At Pixar, Catmull says they have an open culture. They bring in new people with fresh perspectives and encourage young new hires to have the confidence to speak up. Catmull made it a practice to speak at new hire orientations where he talks about the mistakes they’ve made and the lessons they’ve learned. The intent is to persuade newcomers that they haven’t gotten it all figured out, and he encourages everyone to question why they’re doing something if it doesn’t make sense to them. “We do not want people to assume that because we are successful, everything we do is right,” says Catmull.


Catmull says that for 20 years, he pursued a dream of making the first computer-animated film. He admitted, though, that after that dream was realized when they finished Toy Story, that he felt a bit lost. He then realized that the most exciting thing he had done was to help create the unique, creative, and innovative environment that allowed that film to be made. His new goal with every new team or project after that was to build upon those same principles and approaches that he developed at Pixar to transform the studio. “But the ultimate test of whether [we] have achieved our goals is if Pixar and Disney are still producing animated films that touch world culture in a positive way long after [we], and our friends who founded and built Pixar with us, are gone.”


In summary, Catmull embraced creativity, empowered his people with trust, and encouraged risk-taking. He did this by:

  • Acknowledging that people are more important than ideas.
  • Accepting uncertainty and knowing that it’s OK to say, “I don’t know.”
  • Reminding his team that sometimes failure is part of the process.
  • Making it safe for everyone to offer ideas.
  • When it comes to creativity and pitching new ideas, he suggested trying to fail “The Elevator Test.”
  • Developing a peer culture by encouraging people at all levels support one another. He did this by employing different tactics such as “The Brain Trust” and having “The Dailies.”
  • Removing barriers for talented people to be able to work well together.
  • Acknowledging that conflict can be cathartic.
  • Embracing an open culture and empowering new hires to question everything. This sets the foundation for employees to help “carry the torch” and keep the passion and dream alive.


While there is no one magic formula or recipe, by adopting some of these practices, you too can create a unique culture and environment that fosters creativity and innovation to lay a robust foundation for your organization.