measuring return on research and innovation
DESCRIPTION
My talk on metrics on research and (open) innovation during the GPAC (chemical companies) conference in Dubai.TRANSCRIPT
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Measuring Return on Research and Innovation
What should we measure?
How should we do it?
Number of innovation-related rewards and recognitions
Numbers from various feedback mechanisms, showing employee acceptance and understanding of the initiative
Results from the innovation self assessment capability maturity framework (survey measuring five levels of maturity related to innovation behavior)
Percentage of our budget dedicated to innovation, research, and exploration of emerging technologies
Shareholder value created from innovation activities. (Shareholder Value = IT Efficiencies + Business Value provided to the IT customers)
# of ideas generated in specific innovation harvesting campaigns
# of ideas harvested from campaigns, turned into implementable projects# of Intel patent submissions
#Number of white papers published
1) Focus on engagement, training and participation of individuals. Get critical mass
2) Shift / add focus on innovation pipeline (active projects by stage, flow of projects, development, launch and kill)
3) Shift / add focus on end goals (ROI, successful products/services, revenue/savings from new launches, optimized processes)
Hundreds of potential metrics, but not more than 8-10
Jeff Murphy, former Executive Director
Lag indicator: Results are historic and can’t be changed (rewards, number of patents)
Current indicator: Results are present, indicators can be changed (# of ideas, ongoing projects)
Lead indicator: Results are predictive for future and can be changed to high degree (hard to identify)
Jimm Feldborg, Director Global Projects
What should we measure?
How should we do it?
Why you should NOT pay too much attention to this?
Faster pace, shrinking window of opportunity, less time for cash cows
Driven by global megatrends: faster, more open, more transparent and more connected
We need a more holistic approach to innovation!
What is open innovation?
“…a philosophy or a mindset that they should embrace within their organization.
This mindset should enable their organization to work with external input to the innovation
process just as naturally as it does with internal input”
Open innovation as a term will disappear in 5-7 years!
Employees SuppliersManagers Academics / institutions
Executives VCsAlumni Startups
Business unit / function
Users / consumers
Government
Competitors Inventors
P&G PHARMAMEDTECH
Cycle time, money, IPR, conservatism and internal readiness
CHEMICALS
A new paradigm for innovation changes the perspectives and approaches for metrics
on research and innovation
A CFO is wary about investing in the training and education of the employees.
He asks the CEO: ”What happens if we invest in developing our people and then they leave the
company?”
The CEO is a bright person and replies: ”What happens if we don’t and they stay?”
Get in touch!
www.15inno.com
15inno by Stefan Lindegaard at LinkedIn Groups
Twitter: @lindegaard
Hey! Free books on 15inno.com!
A recent comment on 15inno.com
KPI = Kill Potential Innovation