Studies have shown that corporate culture is the most significant element of innovation. Your leaders are the key elements in the creation of that culture. All the money in the world and all the R&D resources in the world won't make as big an impact as your leaders will. But creating a more innovative culture isn't easy to do because by nature, human beings are resistant to change.
"Most of us understand that innovation is enormously important. It's the only insurance against irrelevance. It's the only guarantee of long-term customer loyalty. It's the only strategy for out-performing a dismal economy." - Gary Hamel
"Capital isn't so important in business. Experience isn't so important. You can get both these things. What is important is ideas. If you have ideas, you have the main asset you need, and there isn't any limit to what you an do with your business and your life." - Harvey Firestone
To understand what innovative leadership is you have to first understand what innovation is all about. Innovation is the introduction of something new: a new idea, method or product. There are two types of innovation: exploratory which consists of creating new ideas and then there is exploitative which means changing and improving ideas that you already have.