Innovation is about progress and development. This is exactly why it has to be carefully tracked and measured. However, measuring innovation is not particularly easy. Banking on innovation takes a great deal of investment which is why it has to be well managed. And the only way to know for certain that the efforts and the investment pay off is to find a way to track the progress every step of the way. This includes determining the right aspects to pay attention to.
There are numerous ways to measure the productivity of innovation. But the toughest part is the selection of proper metrics. It is not about using all metrics businesses can get their hands on and warp their minds around. It is about using the metrics that serve the best interest of the business. Among the innovation metrics that are found to be useful to most businesses across industries are the following. These metrics can be grouped into external, internal as well as people metrics.
External metrics include the effect on the brand itself and public reaction. Since most businesses run and depend on branding and image, it is important to gauge the effect of innovative efforts against them. The business should be aware whether the output of innovation has a significant effect on enhancing the image and the brand itself. Given a positive effect, such will reflect on customer and generally business acquisition.
The opinion of the public specifically the business’ target market matters. To gather information about the public’s reaction, measures such as surveys and feedback including analyst rankings will greatly help in determining whether the innovation efforts is a productive one.
Internal metrics should also be utilized to measure the result of the innovation. And this involves the innovation’s impact on the business growth and revenue. This can be executed in several ways.
For instance, it is a must to know whether the innovation system manages to bring about an increase to the investment opportunities of the businesses which may be deemed viable and profitable for overall growth. It would also help to use the other important financial valuation measures including annual asset valuation.
At the heart of the company’s innovation process is the participation of the people or the employees. This is why people metrics is another important factor to key in the process. The rate of results from the innovation project should be tracked.
Another vital point to look at is the increase in the number of employees participating in the innovation process and efforts. It is not just about quantities though, the quality of the efforts should be paid attention too. More people involved in the innovation means an increase in the generation of great ideas that can ultimately mean something to the business and its growth.
Innovation is vital to the continuous and excellent performance of a business. It is something that owners should spend some time on to either advance or maintain its status as a market leader. And to make sure that the efforts are worthwhile, measurement should be a well thought of factor.