Innovation: What’s the measure of success?
Just about every company has its eye on innovation — building designated teams and programs to stimulate disruptive ideas and bring them to market. In fact, about one-third of more mature companies say they have 50 or more people working on innovation, and 47% have a staff of at least 25, according to a new report from Innovation Leader and KPMG.
Today, innovation is non-negotiable. It’s a key ingredient in ensuring an organizations’ ability to compete in the digital age. Businesses must be constantly on the lookout for fresh ideas, from any source, in order to disrupt industries and create opportunities that solve business outcomes for treasured customers. But how does the industry get there faster?
Employees are especially eager to innovate. Regardless of where employees live, their focus and function, or even their level in the company, they are passionate about bringing ideas to life.
They want to make an impact. What they’re looking for is clarity on how to get there. It’s up to leaders to design a comprehensive innovation strategy and roadmap that supports all employees.
The role of metrics in innovation
In creating innovation programs, business leaders should understand the importance of transparently sharing key project metrics with stakeholders. Metrics provide credibility. Demonstrating practical results as proof points inspires employees to innovate and paves the way for executive support.
In addition, metrics authenticate the value of innovation programs, which are often the first to go in budget cuts. This is partially due to resistance to change and short-sightedness, but another factor is the difficulty of measuring and consistently communicating the impact of innovation across organizations.
Some contend innovation cannot be measured. True, innovation is a mindset, but the impact of innovation can and should be measured and the results shared widely and consistently. However, it won’t be as cut and dry as sharing financial data or sales numbers.
Measuring innovation requires a nontraditional approach, using a balanced set of metrics: employee feedback; participation and engagement; brand equity; talent retention and attraction; value and outcomes; and cost of inaction.
Here is what each metric entails and how business leaders should communicate these successes (and even failures), internally and externally.
1. Employee feedback
Employees are the most valuable assets to innovation programs. Their feedback is essential to understanding where businesses are succeeding and they can improve. Listen to them and learn from them.
Solicit employee feedback through listening sessions, surveys, and online communities, and share it transparently across the organization — whether through internal communications (newsletters, social media, intranet sites) or in daily conversations around the water cooler.
Business leaders may learn employees are just as passionate about new business models, value propositions, and technologies as they are about operational or process improvements and corporate social responsibility.
Or, they may learn some employees want to contribute their skills by joining an innovation team or mentoring others but are unsure how to get started. With this feedback, business leaders can set benchmarks while evolving their innovation programs.
2. Participation and engagement
Innovation is a team sport. Whether a program incorporates open innovation (collaboration with external third parties, such as partners, customers, local governments and universities, as defined by KMPG and Innovation Leader), crowd-sourcing employees for ideas, or building an internal network of champions from the C-suite down, none of these tactics will be successful if participants are not engaged and empowered.
As business leaders encourage participation, reach far and wide to all corners of the organization. Here, it’s important to have insight into the number of ideas generated and implemented across an employee base and where they’ve originated. Innovation comes from anyone, anywhere, and everywhere, so keeping tabs on it is critical.
Unleashing game-changing ideas from some of the brightest employees across the globe — and providing the tools to help them execute those ideas — is nothing short of inspirational. And, inspiration drives excitement, engagement, and participation.
3. Brand and talent retention
People want to work for a company where they can make a difference. The number of college graduates looking for employment at larger companies is declining — down to just 14% in 2016, according to Accenture.
To attract and retain the best and brightest talent, companies must consistently showcase an evolving and cutting-edge product philosophy; they must also facilitate a workspace that is flexible, progressive, and open. Reinforcing this through employees and partners, across all functions, is vital.
Take advantage of all the social channels. Employees need to see and hear about internal success and outreach. Encourage them to share their experiences inside the company and as outside ambassadors. Pride enhances the brand and its credibility.
4. Value and outcomes
Everybody wants to hear about successful endings. Most agree that the best metrics are the ones that talk about results. So, be specific. Communicate what worked. Who was involved? Was it a customer? Be clear about what problems were solved and the business value of the outcomes.
Did the solution decrease costs and drive up productivity? Whether it’s the creation of new revenue sources or establishing co-innovation partnerships around product development — be sure to talk about all these types of wins, internally and externally.
5. Cost of inaction
Ongoing investment in employees, partnerships, and new product development are integral to the bigger success of any company. The willingness to disrupt through innovation must be a foundational element of any organization wanting to position itself as an industry leader. History shows that those that don’t will likely fail.
What’s the net-net? Demonstrating support for an innovative employee culture is crucial in today’s business climate. Employees must be empowered and inspired to think and act more like entrepreneurs in a startup-like environment.
They thrive when freed to openly express and develop their passions with C-suite support and without judgment. By encouraging innovation companywide and celebrating individual wins, companies will spark disruptive ideas, team approaches, and an organization capable of leading in the digital age.
This article originally appeared in CIO Dive on September 4, 2018