Harry West of Continuum in his HBR Blog talks about Three Rules of Innovation. Though I think the format of the post is in line with the HBR format.
The important take away is that to innovate in teams, there must be an open dialogues, a free flowing communication which is never personal or personality impacted, and is always focussed on the creative output required from the job at hand. This is important when you are doing a focussed creative work that is expected to generate some output in a given time and with given resources. When you are debating the idea, it is very important be open and transparent and keep your individual egos away in the interest of the work at hand.
He talks about separate space or a room for project teams, which I think is not really required in all environments, it is probably required in his kind of work where it is all about being creative in each and every project. Also I believe in being frugal and not spending over the head to be creative. Creativity should come from you internally, you should feel the urge to do something creative and not expect the whole environment to turn upside down to help you be creative. Unless you have an urge from inside to crack a problem, no amount of environment setting is going to help.