When Satya Nadella took over as Microsoft’s CEO, he didn’t just focus on technology, he used humour and empathy to transform the company’s culture. A recent study from Research Policy, the monthly peer-reviewed academic journal suggests that this leadership style isn’t just likable; it can actually drive innovation.

What is affiliative humour?

This is a type of humour that builds relationships and eases tension and it can significantly enhance organisational ambidexterity. It's positive, relationship-building, and non-aggressive - an example would be a light-hearted comment about a shared work experience or a playful observation that brings a moment of levity to a team meeting.

What is organisational ambidexterity?

Organisational ambidexterity refers to a company’s ability to simultaneously pursue exploration (radical innovation, like developing new technologies) and exploitation (incremental innovation, like refining existing products). While this balance is crucial for long-term success, it’s notoriously difficult to achieve because these two types of innovation often seem at odds.

The Role of CEO affiliative humour

The study found that CEOs who use affiliative humour create an environment where leaders can more effectively navigate the tensions between exploration and exploitation. Here’s how it works:

1. Easing tension - humour helps diffuse the stress and tension that often arise when discussing conflicting priorities, making it easier for teams to engage in open, productive dialogue.
2. Facilitating bonding - affiliative humour fosters stronger relationships among top leaders, enhancing collaboration and decision-making.
3. Encouraging open discussion - by using humour to address incongruities, CEOs can keep conversations about innovation strategies open and constructive, rather than shutting them down.

Key Takeaways for CEOs

1. Humour is a leadership tool - far from being frivolous, humour can be a strategic asset. CEOs who use affiliative humour can create a more cohesive, innovative leadership team.
2. Balance is key - the study highlights the importance of balancing radical and incremental innovation. Humour can help CEOs and their teams navigate this balance more effectively.
3. Context matters - the impact of humour is amplified when CEOs work with boards that have longer shared tenure (directors who have worked together for a long time) and when directors are less busy (not overcommitted with multiple board roles).

In a world where innovation is the lifeblood of success, CEOs who can skilfully use affiliative humour to navigate the complexities of organisational ambidexterity will have a distinct advantage. By fostering an environment of openness, collaboration, and creativity, humour can be more than just a laugh - it can be a catalyst for growth.

Reference: Campbell, R. J., Short, C. E., & Graffin, S. D. (2025). Balancing the radical and the incremental: CEO affiliative humour and organizational ambidexterity. Research Policy, 54(1). Read more.