essentials guide how to develop an innovation strategy:...

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Essentials GuideHow to Develop an Innovation Strategy:Workbook

Essentials GuideInnovation Strategy Workbook

Innovation Simplified | [email protected] | P 646-257-5737 | © Future Think LLC. All rights reserved 1

As you’re learning from the accompanying Guide, a powerful innovation strategy comprises 3 core elements:

1. Defining Innovation2. Managing Innovation3. Measuring Innovation Success

For each of the above elements, the scorecards on the following pages list 3 characteristics related to the element. The team in charge of innovation should use this scorecard to evaluate and rank your organization (or the innovation team itself) according to its actual activity around each characteristic.

Once you identify benchmarks based on your scorecard results, share these with senior management and possibly the larger group to validate your findings, gain consensus, and plan your efforts.

Strategy Scorecard: Analyze Your Innovation Strategy + Prioritize Efforts



Total out of 9

2. Managing Innovation

At least one senior leader in our organization is focused on driving our innovation efforts.

We have a core and full-time individual/team assigned to innovation that ensures innovation efforts are consistent and effective.

When innovation guidance is needed, everyone in our organization knows exactly who the go-to person is.

Strongly Disagree

Disagree Agree Strongly Agree

0 1 2 3

0 1 2 3

0 1 2 3

3. Measuring Innovation Success

We have created a holistic set of metrics that measures input (number of ideas, amount of investment), development (time to market), and output (percentage of revenue).

Metrics function in our organization as a tool for improving and adjusting our innovation efforts, not assigning blame or failure.

Strongly Disagree


0 1 2 3

0 1 2 3

0 1 2 3

Total out of 9

1. Defining Innovation

We’ve communicated a vision for innovation that is clear, inspirational, and galvanizes employees around our innovation goals.

We’ve clearly identified issues that have blocked innovation in the past and outlined how we’ll overcome them.

Consistent language surrounding innovation is used across our entire organization.

Strongly Disagree


0 1 2 3

0 1 2 3

0 1 2 3

Total out of 9

Total Strategy Score out of 27

GO TO NEXT PAGE


Circle the numeral that most accurately describes your organization’s position on each characteristic.

We consistently use this set of metrics as our innovation dashboard for tracking our innovation activities.



Total Score Range Assessment

Weak: Your innovation strategy is haphazard or serendipitous, and you’re not reaching your intended goals. You need to cultivate strategy elements in all three areas.

Moderate: Some aspects of an innovative strategy are in place, but improvement is needed.

Strong: Your organization demonstrates a results-oriented strategy, so sustain your efforts on all three fronts.

0–15

16–30

31–45

Now that you have an accurate sense of your organization’s strategy, let’s return to page 7 of the Guide.

Total Strategy ScoreReview your total strategy score from page 2 and compare it to the ranges below to see how your innovative your strategy is...or isn’t.

Scores for Each ElementRefer to page 2 and transfer your total score for each behavior into column 2:

Element Score Range Assessment

0–3

4–6

7–9

Weak: This behavior is missing from your climate and should be addressed immediately.

Moderate: Some aspects of this element are present in your organization, so review the attributes in which you scored low to identify where to focus improvement.

Strong: This element is clearly represented across your organization and all related activity/support should be maintained.


Element Your Score

Defining Innovation

Weak, Moderate, or Strong?

Compare each of your element scores above to the ranges below. According to your score, rank each element as weak/moderate/strong and write on line provided in column 3 above.

Managing Innovation

Measuring Innovation Success

Total =



The worksheets on pages 9–12 provide a clear method for developing an effective strategy for innovation. Our 5-step approach is summarized below.

Step #1.Challenges: Start by identifying the challenges that hold you back from being a leading innovator.

Step #2. Opportunities: After listing the factors that block innovation in your organization, you’ll plot out opportunities by answering the question of what your organization can do to address each of those challenges.

Step #3. Prioritize Opportunities: To focus your energy on your most fertile opportunities, you’ll identify 3 areas with the most potential to impact your innovation process.

Step #4. Define Direction for Innovation: This is where you’ll deep-dive into your 3 most important opportunities to identify how you will direct your innovation effort.

Step #5. Draft + Craft an Innovation Vision: The final step is to develop a vision for innovation. How does your future organization look and behave? Thought-starters are provided to direct your thinking toward an effective vision.

Who doesn’t love an example? Before diving into Step #1, review the next 4 pages to see how an automotive company completed these worksheets.

1. Defining Innovation:

What’s Your Vision for Innovation?



Sam

ple

✓ ✓

✓ ✓

✓ ✓ ✓

✓ ✓

✓✓✓

We’

re n

ot a

gile

. O

ur p

roce

ss fo

r br

ingi

ng in

nova

tions

to m

arke

t is

pai

nful

ly s

low

.

We

are

too

regi

men

ted

and

depa

rtm

enta

lized

. A

lack

of o

pen

com

mun

icat

ion

acro

ss th

e or

gani

zatio

n pr

even

ts u

s fr

om in

nova

ting

effe

ctiv

ely.

Inno

vati

on is

not

dem

ocra

tize

d.

Inno

vatio

n ha

s be

en r

eleg

ated

to a

n el

ite c

orne

r of

ou

r or

gani

zatio

n.

We

lack

cus

tom

er f

ocus

. W

e’ve

lost

sig

ht o

f our

cus

tom

ers’

nee

ds.

We

lack

the

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lls t

o in

nova

te.

Our

em

ploy

ees

do n

ot th

ink

or a

ct li

ke in

nova

tors

.

We’

re e

xtre

mel

y fo

cuse

d on

the

sho

rt-t

erm

. W

e ne

ver

crea

te lo

ng-t

erm

pla

ns fo

r in

nova

tion.

We

will

bec

ome

the

mos

t agi

le in

nova

tor

in th

e w

orld

by

decr

easi

ng o

ur ti

mel

ine

from

idea

sub

mis

sion

to la

unch

.

We

will

cru

sh s

ilos

and

fost

er a

n en

viro

nmen

t with

act

ive

dial

og b

etw

een

depa

rtm

ents

, lev

els,

and

func

tions

.

Inno

vatio

n is

now

the

resp

onsi

bilit

y of

eve

ry e

mpl

oyee

, an

d w

e ar

e co

mm

itted

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ublic

ly r

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ding

inno

vativ

e be

havi

or a

nd a

ctiv

ity.

We

will

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ome

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cuse

d on

con

sum

ers’

late

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nd

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ant n

eeds

.

We

will

mak

e in

nova

tion

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ng

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le w

hose

trac

k re

cord

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udes

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vatio

n an

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trep

rene

ursh

ip.

We

will

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mit

to c

reat

ing

a lo

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pla

n fo

r in

nova

tion

guid

ed b

y a

long

-vie

w o

f our

mar

kets

and

cus

tom

ers.

Ste

p #1: C

halle

nges

Wha

t’s s

topp

ing

your

org

aniz

atio

n fr

om b

eing

a le

adin

g in

nova

tor?

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heck

the

boxe

s be

low

that

spe

ak to

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r in

nova

tion

obst

acle

s, a

nd

use

the

empt

y sp

ace

to w

rite

in a

cha

lleng

e th

at is

n’t a

lread

y lis

ted.

Step

#2:

Opp

ortu

nitie

sN

ow id

entif

y a

way

to o

verc

ome

each

cha

lleng

e—no

mat

ter

how

rea

listic

the

solu

tion.

Pus

h yo

ur th

inki

ng to

the

extr

eme

by a

skin

g w

hat c

ould

be

chan

ged

to r

ende

r th

e ch

alle

nge

a no

n-is

sue?

We

don’

t hav

e a

pass

iona

te g

roup

of c

usto

mer

s w

ho v

iew

ou

r veh

icle

s as

a li

fest

yle

stat

emen

t.W

e’ll

iden

tify

and

attra

ct a

new

dem

ogra

phic

of

influ

ence

rs w

ho w

ill re

plic

ate

the

fan

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win

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our

go

lden

era

.


Completed Sample



Sam

pleOur #1 opportunity is:

Our #2 opportunity is:

Our #3 opportunity is:

Our #1 Direction is:



Step #3: Prioritize OpportunitiesReview your opportunities from Step #2 on the previous page, and choose 3 opportunities with the most potential to impact your innovation process.

Step #4: Define Direction for Innovation

Become the most agile innovator in the world by decreasing our timeline from idea submission to launch.

Become laser-focused on consumers’ latent and blatant needs.

Identify and attract a new demographic of influencers who will replicate the fan following of our golden era.

Launch innovations—groundbreaking and incremental—faster than our competition.

Expand and market our online collaboration portal and In-novation Lab to increase interaction, feedback and consumer loyalty from target demographic.

Capitalize on the passion and disposable income of Millen-nials by designing and marketing products and services for the short- and long-term needs of this demographic.


Completed Sample

Dive deeply into each of your 3 opportunities and articulate the specific actions needed to make them a reality. For ex-ample, if your Opportunity is “Identify and attract a new de-mographic of influencers who will replicate the fan following of our golden era,” then its corresponding Direction could be “Capitalize on the passion and disposable income of Mil-lennials by designing and marketing products and services for the short- and long-term needs of this demographic.”



Sam

ple

Which statements on the left should be included in your innovation vision? Jot these below:

Your vision should clearly communicate how innovation will transform your organization—but without using jargon. To start shaping your thinking into a meaningful and succinct vision, fill in the blanks below:

We are a _________________________ (descriptor) company

that offers _____________________________ (products and

services) to ________________________(customers).

Unlike our competitors, we do __________________________

better than anyone else in the world.

We will be the world’s #1 provider of _____________________

in the world.

Our future: we will be the ___________________ (descriptor)

within 5 to 10 years.

From now on, we’ll stop being _________________________

______________________________ (obstacles/present state)

and start being ______________________________________

(aspirational/future state.)

We will do _________________________ better than anyone

else in the world.

We will transform into a _______________________________

(descriptor) company that focuses on ___________________

____________ (markets/objectives).

Our products/services will make a difference in our custom-

ers’ lives by ______________________________.

We will make a difference by __________________________. It’s time to finalize the vision for your innovation strategy on the following page.

Step #5: Draft + Craft an Innovation Vision

Notes for our Innovation Vision


Completed Sample

• Transform into > tomorrow’s

most iconic car company.

• We need to do hybrids

better than everyone else!

• Make a difference…through

sustainable, alternative fuel

options.

• We already do (technology)

better than the competition.

• 5 -10 years from now =

be the car company of the

Millennial generation



Sam

pleTransfer your top 3 Directions from P. 7 into the box below. Use these and

your notes from P. 7 to inform your vision for innovation:


Completed Sample

(Step #4)Top 3 Directions for Innovation

(Step #5)Our Innovation Vision

1.

2.

3.

Launch innovations—groundbreaking and incremental—

faster than our competition.

Expand and market our online collaboration portal and

Innovation Lab to increase interaction, feedback, and

consumer loyalty from target demographic.

Capitalize on the passion and disposable income of Millen-

nials by designing and marketing products and services for

the short- and long-term needs of this demographic.

We will recapture our former glory by providing the most

iconic, environmentally conscious, and technologically ad-

vanced cars in the world.



We’

re n

ot a

gile

. O

ur p

roce

ss fo

r br

ingi

ng in

nova

tions

to m

arke

t is

pai

nful

ly s

low

.

We

are

too

regi

men

ted

and

depa

rtm

enta

lized

. A

lack

of o

pen

com

mun

icat

ion

acro

ss th

e or

gani

zatio

n pr

even

ts u

s fr

om in

nova

ting

effe

ctiv

ely.

Inno

vati

on is

not

dem

ocra

tize

d.

Inno

vatio

n ha

s be

en r

eleg

ated

to a

n el

ite c

orne

r of

ou

r or

gani

zatio

n.

We

lack

cus

tom

er f

ocus

. W

e’ve

lost

sig

ht o

f our

cus

tom

ers’

nee

ds.

We

lack

the

ski

lls t

o in

nova

te.

Our

em

ploy

ees

do n

ot th

ink

or a

ct li

ke in

nova

tors

.

We’

re e

xtre

mel

y fo

cuse

d on

the

sho

rt-t

erm

. W

e ne

ver

crea

te lo

ng-t

erm

pla

ns fo

r in

nova

tion.

We

will

bec

ome

the

mos

t agi

le in

nova

tor

in th

e w

orld

by

decr

easi

ng o

ur ti

mel

ine

from

idea

sub

mis

sion

to la

unch

.

We

will

cru

sh s

ilos

and

fost

er a

n en

viro

nmen

t with

act

ive

dial

og b

etw

een

depa

rtm

ents

, lev

els,

and

func

tions

.

Inno

vatio

n is

now

the

resp

onsi

bilit

y of

eve

ry e

mpl

oyee

, an

d w

e ar

e co

mm

itted

to p

ublic

ly r

ewar

ding

inno

vativ

e be

havi

or a

nd a

ctiv

ity.

We

will

bec

ome

lase

r-fo

cuse

d on

con

sum

ers’

late

nt a

nd

blat

ant n

eeds

.

We

will

mak

e in

nova

tion

a to

p pr

iorit

y by

hiri

ng

peop

le w

hose

trac

k re

cord

incl

udes

inno

vatio

n an

d en

trep

rene

ursh

ip.

We

will

com

mit

to c

reat

ing

a lo

ng-t

erm

pla

n fo

r in

nova

tion

guid

ed b

y a

long

-vie

w o

f our

mar

kets

and

cus

tom

ers.

Ste

p #1: C

halle

nges

Wha

t’s s

topp

ing

your

org

aniz

atio

n fr

om b

eing

a le

adin

g in

nova

tor?

C

heck

the

boxe

s be

low

that

spe

ak to

you

r in

nova

tion

obst

acle

s, a

nd

use

the

empt

y sp

ace

to w

rite

in a

cha

lleng

e th

at is

n’t a

lread

y lis

ted.

Step

#2:

Opp

ortu

nitie

sN

ow id

entif

y a

way

to o

verc

ome

each

cha

lleng

e—no

mat

ter

how

rea

listic

the

solu

tion.

Pus

h yo

ur th

inki

ng to

the

extr

eme

by a

skin

g w

hat c

ould

be

chan

ged

to r

ende

r th

e ch

alle

nge

a no

n-is

sue?


Challenges + Opportunities



Our #1 Opportunity is:



Step #3: Prioritize OpportunitiesReview your opportunities from Step #2 on the previous page, and choose 3 opportunities with the most potential to impact your innovation process.

Dive deeply into each of your three opportunities and articulate the specific actions needed to make them a reality. For example, if your Opportunity is “Identify and attract a new demographic of influencers who will replicate the fan following of our golden era,” then its corresponding Direction could be “Capitalize on the pas-sion and disposable income of Millennials by designing and mar-keting products and services for the short- and long-term needs of this demographic.”

Step #4: Define Direction for Innovation


Prioritize Opportunities + Define Direction






Your vision should clearly communicate how innovation will transform your organization—but without using jargon. To start shaping your thinking into a meaningful and succinct vision, fill in the blanks below:

It’s time to finalize the vision for your innovation strategy on the following page.

Step #5: Draft + Craft an Innovation Viwsion



Draft Your Innovation Vision

Which statements on the left should be included in your innovation vision? Jot these below:

We are a _________________________ (descriptor) company

that offers _____________________________ (products and

services) to ________________________(customers).

Unlike our competitors, we do __________________________

better than anyone else in the world.

We will be the world’s #1 provider of _____________________

in the world.

Our future: we will be the ___________________ (descriptor)

within 5 to 10 years.

From now on, we’ll stop being _________________________

______________________________ (obstacles/present state)

and start being ______________________________________

(aspirational/future state.)

We will do _________________________ better than anyone

else in the world.

We will transform into a _______________________________

(descriptor) company that focuses on ___________________

____________ (markets/objectives).

Our products/services will make a difference in our custom-

ers’ lives by ______________________________.

We will make a difference by __________________________.




(Step #4)Top 3 Directions for Innovation

(Step #5)Our Innovation Vision

1.

Transfer your top 3 Directions from page 10 into the box below. Use these and your notes from page 11 to inform your vision for innovation:


Craft Your Innovation Vision

2.

3.

Congrats on crafting your innovation vision. To confirm that you’ve articulated a winning strategy, use the checklist on the next page.



Review the criteria on this checklist and check off the boxes accomplished by your Innovation Vision. The more criteria that you meet, the more powerful and effective your Vision will be for the organization.

It is absolutely free from jargon.

It sounds lofty, grand, and ambi-tious—but not unrealistic.

It is simple enough for everyone to understand.

It signals a refreshing or new direction for our organization.

It is authentic and we strongly believe in it.

It clearly signals a break from the past, and how we used to do things.

It will energize, excite, and inspire our employees.

It fills us with hope, confidence, and ambition.

It gives us a sense of purpose and direction.

If your innovation vision didn’t meet the criteria on this page, keep revising until it does, and then move on to the next

1. Defining Innovation:Test Your Innovation Vision



Without a communications plan, your Innovation Vision and Direction can’t gain momentum and support. Review our tactics below for spreading innovation news internally and externally, and check the ones relevant to your organization. Use the space provided for ideas not included here.

Design an internal marketing plan. Internal communications are crucial to shifting employee mindsets and educating the entire organization about the new innovation effort. Develop a formally phased marketing plan that includes channels like the company intranet, blog, and newsletter to sell the innovation Vision and Direction.

Develop C-Suite talking points. Provide the Vision and 3 Directions as a cheat sheet to all senior managers. Remind them to always refer to it when discussing innovation—internally and externally.

Create an ambassador program. Identify respected employees who are known for embracing change and crown them as innovation ambassadors. These individuals should spread enthusiasm for the new innovation direction to their teams; communicate ideas and news around innovation; and get support from key players within the organization.

Communicate externally. Your Vision and Direction will become the public face of your innovation efforts, so create an external positioning plan for your website, advertising, and PR to ensure that the message is well received. You’ve now completed

the first element of your innovation strategy. Return to page 13 of the Guide.


Rolling Out the Innovation Vision



Step A. Role: Should you designate your innovation team as an Incubator, Facilitator, or a hybrid model of both? Innovation teams that take on the Incubator role are developing breakthrough ideas from start to finish. Teams acting as Facilitators assist other groups to improve their innovation efforts. While the hybrid model is a reality for many companies, most strive to be clearly one or the other so innovation responsibilities are crystal clear. Through this worksheet exercise, your answers will steer you either toward “Incubator” or “Facilitator,” which will guide how you shape the team’s role.

The role that’s best for your organization depends on your goals for innovation, timelines, budgets, and current levels of innovation activity.

Steps B + C. Location and Responsibilities: Now that you’ve decided on role, where will the innovation team sit within your organization and what’s on their to-do list?

Step D. Profile: Lastly, who should be appointed to the innovation team?

The Guide presented examples of how leading innovators choose to assign innovation ownership within their organizations. On the next 4 worksheets, you’ll make the same decisions using the 4 steps below.

2. Managing Innovation:

Assigning Ownership to Innovation

Turn the page to make the decision upon which your ownership decisions will be based. (No pressure.)



Adequate vs. Little Innovation Activity

Existing vs. Non-Existing Capabilities

Existing vs. Separate Budgets

Long vs. Short Timeframes

We want to make teams at the lowest level in our organization accountable and responsible for innovation.

Our business units currently have a base level of innovative activity.

Our business units demonstrate the skills and capabilities to innovate, and will respond to encouragement and our new innovation directions.

We want innovation projects funded with our existing R&D/New Product/New Service development budgets.

We can afford the long timeframes required to spread the spirit of inno-vation widely across the organization.

We want to localize our innovation efforts so the rest of the business can focus on business-as-usual and incremental in-novations.

Our business units conduct little or no innovation activity.

Our business units do not demonstrate the skills or capabilities to produce breakthrough innovations.

We have the ability to earmark separate funds devoted to developing breakthrough innovations all the way to launch.

We need to quickly start launching groundbreaking ideas.

Recommended Role: Facilitator

Recommended Role: Incubator

Democratize vs. Localize

Review your organization’s ratings above: Do answers lean toward one end of the scale? If so, this indicates the role your innova-tion team will play. If your answers are all over the scale, ask yourself which of the factors above are most important? Based on your answer for that specific factor, check off one of the roles below.

Check the box that most accurately describes where your organization stands along the scale.

Facilitator Incubator


Choosing a Role for Your Innovation Team



Step B. Location: Where will this team sit?

Check one of the boxes. Use the blank space to customize your own.

Step C. Responsibilities: What is the team’s Charter of Responsibilities?


Make our innovation efforts more consis-tent by guiding teams with the direction and resources needed to move their projects forward.

Be the go-to team when team when busi-ness units need ad-vice, training, or other innovation resources.

Ensure that our portfolio of innovation projects is aligned with corporate strategy.

Evaluate and review projects/ideas through-out the development process and ensure that they are truly in-novative.

Facilitator

Step B. Location: Where will this team sit?


Step C. Responsibilities: What is the team’s Charter of Responsibilities?


Incubator

Generate and gather the best and most groundbreaking ideas.

Exercise creativity and resourcefulness needed to bring ideas to market quickly.

Meet market and bud-get requirements as projects are developed for launch.

According to the role you selected, answer the questions related to either Incubator or Facilitator to determine location and responsibilities of the innovation team.

Central team at corporate level

Hub-and-spoke

Other

Central team at corporate level

Hub-and-spoke

Other

Other

Other


Innovation Team Location + Responsibilities



Identify individuals who understand the organization and know whom to tap for support and resources. Seek people who embody best practices and are known for pro-viding good direction and advice. Bonus points for employees who are trained facilitators, coaches, or mentors. Use the space below to name people to the innovation team.

Assemble a cross-functional (R&D, Legal, Marketing, and Sales) and self-sufficient team with track records in commercializing ideas. From that pool, identify people who function well in unpredictable, high-risk environments. Bonus points for employees with entrepreneurial backgrounds who demonstrate a tendency to question existing rules and conventions. Use the space below to name people to the innovation team.

You’re almost there! Turn the page to summarize your decisions about owning your innovation strategy.

Facilitator Incubator

Assemble your innovation team for Step D. Add employee names below to either the Facilitator or Incubator model you chose in Step A.


Assembling Your Innovation Team

Team Member(s):1. _________________2. _________________3. _________________4. _________________

Team Member(s):1. _________________2. _________________3. _________________4. _________________



(Step A) Role:

(Step B) Location:

(Step C) Responsibilities:

(Step D) Profile:

You’ve now completed decisions surrounding management of your innovation strategy. Return to page 18 of the Guide.


Summarize Your Ownership Decisions

Summarize all 4 areas of your Innovation Ownership Model below:



As you’ve seen in the Guide, organizations use metrics to determine whether their innovation efforts are on track with their goals. The worksheets on the next 6 pages present a simple approach to choosing metrics across your entire innovation process.

3. Measuring Innovation Success:

How Will You Measure Innovation?

Step #1. Select Input MetricsStep #2. Select Development MetricsStep #3. Select Output MetricsStep #4. Summarize Your MetricsStep #5. Set Goals

You’ll be selecting a total of 5 to 8 metrics across three categories of input, development, and output. Once you’re done, you’ll prioritize and set goals. Let’s do this.



Input metrics refer to what you put into your innovation effort. Choose metrics that help you monitor current challenges and encourage innovative behaviors that you want employees to adopt. Use the blank spaces to cus-tomize your own input metrics.

Inputs Metrics

Frequency of senior management meetings to discuss innovation

Amount of time senior team spends on innovation

Number of customer needs (blatant or latent) addressed through new ideas

Percentage of employees for whom innovation is included in performance evaluation

Number of customers involved in beta testing an idea

Amount of capital allocated for innovation projects

Number of external/internal communications about innovation from senior management

Number of ideas generated/requested by customers

Number of ideas generated outside R&D or New Product teams

Number of ideas generated per employee

Number of innovation tools/ methodologies available to employees and the actual number used

Number of customers contacted

Number of current employees who have received innovation training

Percentage of time spent by employees on innovation activities


Select Input Metrics



Development MetricsDevelopment metrics refer to what’s happening across your innovation effort right now. Choose metrics that help you monitor current challenges and encourage innovative behaviors that you want employees to adopt. Use the blank spaces to customize your own development metrics.


Select Development Metrics

Percentage of ideas funded

Average time to market

Amount of collaboration with external partners (academia, scientific labs, etc.)

Adoption rate of new technologies to enhance productivity and innovation

Time spent on each phase of an idea, from submission to launch

Productivity growth (in value of goods/services produced, or efficiency in production)

R&D spend at each stage of development

Number of ideas killed after entering pipeline but prior to launch

Number of ideas/projects in innovation pipeline

Average investment per stage of idea- management process

Projected vs. actual staffing of current innovation projects



Number of new products/services developed annually

Percentage of revenuefrom newproducts/services

ROI on innovation projects

Market share of new products/ services

Number of groundbreaking innovations launched vs. incremental improvements

Number of projects that failed after launch

Number of satisfied employees

Customer satisfaction rate

Current value of intellectual property

New customers’ adoption rate

Total shareholder return (rise of stock prices + dividends)

Percentage of reduced costs (quarterly, annually,

Number of industry firsts launched (quarterly, annually, etc.)

Value of innovation portfolio (present/ 3 yrs/5 yrs)

Total shareholder return (gain that shareholders will experience with rise in stock prices + dividends)

R&D spending per number of engineers, scientists, and technicians employed

Outputs MetricsOutput metrics refer to what you got out of your innovation effort. Choose metrics that help you monitor current challenges and encourage innovative behaviors that you want employees to adopt. Use the blank spaces to cus-tomize your own output metrics.


Select Output Metrics

Number of new markets penetrated through innovation efforts

Number of patents currently held

Number of product mentions online and in traditional media



Finalize 5 to 8 metrics. From the previous 3 pages, list 5 to 8 of your selected metrics in the columns below. Be sure to include a mix of input, development, and output metrics.

Inputs Developments Outputs

Now that you’ve selected your metrics, let’s define your goals and objectives for each one.


Finalize Your Metrics



METRIC CURRENT BASELINE

GOAL TIMELINE

Write each of your 5 - 8 selected metrics below.

Where does your organization stand on this metric today? If one of your metrics is “number of ideas/projects in innovation pipeline” and your current number is 10, that’s your baseline. Define the current state of each metric below.

Do you want to increase or decrease this metric? Express your goal for each metric as a percentage or an absolute number.

When do you want to achieve each goal? Do you need to accomplish it in 6 months? 1 year? 3 years from now? Specify your timeline for each metric.

Inputs:

Metrics are useless without an accurate baseline or future goals. Use this worksheet to set tangible goals that will motivate teams—not set people up for failure. Keep yourself and others accountable by sharing these goals and timelines across the organization, and revisiting them often.

What are best practices for managing metrics? Check out the following page.


Set Goals

Developments:

Outputs:



Get the most out of your metrics by utilizing the pro tips below. Check the ones that are scaleable, and use the blank space to customize your own.

Operationalize your metrics. For every metric, create a simple process for how data is collected. If you’re tracking “number of ideas generated per employee” and your organization has a history of holding spontaneous brainstorms, this could be hard to measure. Avoid underreporting by establishing a system (or a point person) that channels data back to one metric.

Develop an executive dashboard. In advance of every senior management meeting, assign creation of a one-sheet of your current metrics to your innovation team. By providing data that is succinctly organized, leadership can easily make decisions that guide innovation in real-time.

Decide how often you want to measure. How often do you need to track and report metrics to management? Monthly? Quarterly? Measure frequently enough to course-correct if needed but without requiring teams to gather overwhelming amounts of information.

Metrics require maintenance. Beyond setting metrics and goals, it’s important to monitor the movement of your metrics. Where are the upward trends? Are timelines being met? Where are the improvements in your organization? Which innovation challenges remain problematic? Prior to the quarterly or 6-month mark, assess whether your goals and timelines have been realistic and if necessary, make adjustments.

The Softer Side of MetricsWhile many aspects of innovation can be measured by the 5 to 8 metrics you’ve selected, a less tangible but equally powerful indicator of change can be observed in “soft,” qualitative metrics. Examples of these include:

• Teams at all levels are actively finding new solutions to old problems

• Development teams have fewer major over-hauls and more minor tweaks.

• The quality of ideas and/or execution is improving

• Observable sense of excitement about innovation among teams

Use your hard metrics to tangibly demonstrate results, but keep your ears and eyes open for more subtle corollaries of innovation (and encourage others to do the same).

Congratulations! You’ve completed all the elements of your innovation strategy. Return to page 24 of the Guide for a few final tips.

Other


Manage Your Metrics

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