How play at work can make for happier, more innovative employees – and help a business get its mojo back.

With a swirl of world events, tech developments and threats to international trade making business ownership an increasingly dicey proposition, it might seem mad for embattled leaders to loosen the reins and embrace experimentation. Yet according to Messrs Mark Dodgson and David M Gann – the two London-based professors behind the pioneering book The Playful Entrepreneur – that’s exactly what might yield the best results.

Focusing on a range of techniques to deal with uncertainty and featuring a range of interviews with entrepreneurs and innovators across various sectors, the pair argue that marrying play with work can encourage innovation in difficult times by exploring four “noble” behaviours – fortitude, craft, ambition and grace – that inform entrepreneurs’ decision-making and leadership.

Whether delivering better results from happier employees, establishing a culture that encourages innovation or harnessing technology to slimline the drudgery, the book contains a number of takeouts for the savvy business owner. We spoke to Mr Dodgson and Mr Gann to run the figures on this spirited approach to modern business.

“Many large organisations are threatened by disruptive forces – in technology and their markets – and they don’t know what to do about it,” says Mr Dodgson. “They desperately need to create or refresh an innovative culture, and who best can they learn from but entrepreneurs, for whom seeing opportunities and taking risks defines what they do?” Pointing to the way that startup founders explore and experiment, learn and adapt, express their freedom at work while having fun at the same time, Mr Dodgson suggests that the same concepts should be replicated in large organisations.

The principles behind The Playful Entrepreneur mean equally playful consequences for employees, too, something to be embraced in an increasingly anodyne workplace. “There’s little that is joyful about modern work,” says Mr Dodgson. “Everyone is time poor and constantly measured and evaluated against often pointless metrics. By showing how playful entrepreneurs run their working lives, we provide an alternative model from which everyone can learn.” This also trickles through to workplace design. Mr Dodgson points to the HQs for IDEO, Airbnb and Heatherwick Studio as examples of carefully designed hubs of creativity.

According to Mr Dodgson, many modern businesses don’t help themselves when it comes to their working practices. “You’ll find incentive systems that encourage caution and reward past behaviours rather than the ones that are needed in the future,” he says. “One of our favourite New Yorker cartoons has a manager responding to an enthusiastic young employee with, ‘This really is an innovative approach, but I’m afraid we can’t consider it. It’s never been done before.’” What’s needed, he continues, is for leaders to give employees permission to get excited about new ideas and to signal that it is not career limiting if they don’t work out as expected.

History reveals many companies that have harnessed playfulness to test new ideas. Mr Gann claims that IBM did this when identifying an emerging threat from virtual worlds, by encouraging staff to work in new ways with virtual reality. “The president and executive team held a serious decision-making meeting using avatars so they could explore what opportunities and risks this technology might bring,” he says. “Other companies, such as Shell, take a ‘gamechanger’ approach to assessing future technological opportunities.”

There has been a burst of interest in entrepreneurship following the global financial crisis. Mr Dodgson cites the growth of hackspaces, business incubators and university-led innovation campuses around the world. “Most entrepreneurs aren’t in it to make loads of money, although that is nice when it happens,” he says. “They want to make a difference and have jobs that are meaningful and rewarding. Our idea of the playful entrepreneur, and the noble behaviours that underlie what they do, gives voice to the virtues of being a contemporary change agent who can shake things up while remaining a decent human being.”

The Playful Entrepreneur (Yale University Press) by Messrs Mark Dodgson and David M Gann is out 2 October