Temper, Temper!

Rice University researchers have found that good and bad moods can work side by side to generate creativity and spur innovation. "When people are in good moods all the time, it can lead to complacency," says Jennifer M. George, professor of management and psychology at Rice University and co-author of the study. "A negative mood can give you that push to put forth more effort."

Managers, however, need to be able to navigate employees' daily dispositions. Here are a few tips for guiding employee moods to encourage creativity:

• Provide development feedback. Keep conversations focused on learning and improvement. This will help happy employees think more expansively and will encourage employees in bad moods to think about solutions.
• Share your knowledge. Telling employees how you're making decisions will make them more likely to take risks, which are at the heart of creative thinking.
• Establish trust with employees. Inspiring confidence is especially important when employees are in a bad mood. They need to feel comfortable giving negative feedback that could eventually mean positive, innovative change for the entire company.

This article was originally published in the July 2007 print edition of Entrepreneur with the headline: Temper, Temper!.