Australian software firm Atlassian has developed a novel method to give its employees enough "slack time" to develop new ideas, and it's gone viral.

By Polly LaBarre, contributor

(TheMIX) -- What leader today doesn't want more innovation? Yet, producing more (of anything) inside an organization generally leads to more process, which smothers individual creativity and all-too-often kills organizational innovation.

Innovation isn't about structuring a process to lead to an outcome so much as it's about creating space -- both elbow room, the space to roam free of bureaucratic rules and red tape, and head room, the freedom to see differently, think wildly, and aim higher.

The leaders who generate more creative energy and innovation are always wrestling with the question: How do we design in more slack? Or, how do we create an environment and support work that enlists people to invent their company's future?

Those questions are the beating heart of nine-year-old Australian enterprise software company Atlassian. Founded with the intent to become "a different kind of software company," Atlassian has also dedicated itself to developing a different way of working. The result: the company stands out as much for its approach to engaging people as it does for its software and collaboration tools. And it's grown to $100 million in sales (with no salespeople) and 18,000 customers around the world (including Citigroup (C), Nike (NKE), NASA, Facebook, and Zappos) on the basis of that approach.

Atlassian is constantly inventing and refining practices to unleash its people. One of those practices has gone viral. It's called FedEx Day, a quarterly, 24-hour innovation blitz of hacking, prototyping, and presenting that involves almost everybody in Atlassian's three offices around the world. Launched seven years ago by co-founder Mike Cannon-Brookes as an effort to retain the creative vigor of a startup even as the company expanded rapidly, FedEx Day is an experiment in structuring the kind of slack that not only gives new ideas room to grow but also pushes them forward.

The two pillars of the practice address that tension between opening up space to explore and driving to produce. First, participants must work on something that is explicitly not their day job -- a passion project, a personal itch you're dying to scratch, or an organizational pain point. Second, they must deliver something in 24 hours -- hence FedEx (FDX), "when it absolutely, positively has to be there overnight." In the course of 18 FedEx Days, Atlassian has done just that, with 550 projects shipped and 47 features or products delivered to the company's customers. More