In the 21st century world-class universities will need to be much more focused on innovation, rather than on stability and standardization. An innovative organization is different from a stable one. It requires different skills from its participants, and it functions in a different way from a stable organization. A focus on innovation will necessitate a different kind of university from what exists at most institutions today. Those who want to create and maintain a world class university will need to develop a culture of innovation in their organizations. In this report, William Tierney first outlines an organization's barriers to innovation that retard creativity. He then considers seven topics central for an innovative organization: (1) risk-taking; (2) personal autonomy; (3) goal-setting; (4) decision-making; (5) teamwork; (6) fiscal and temporal resources; and (7) organizational excitement.