Measure Innovation NOT InnovationS

March 24, 2009  

Measuring innovation is very different than measuring innovationS (“s” capitalized for emphasis). Let me explain.

In our goal-obsessed society, we want to measure everything that moves. In doing so, we feel as though it gives us a grasp of the real world. But is this true? Do measures really provide a lens into reality?

A colleague of mine used to say, “You’ll get what you measure, but will you get what you want?”

This poses a very interesting question. What should you measure in order to get the insights you want and the behaviors you desire?

In the past I wrote a few blog entries on this topic.

In “How Do You Measure Success?”  I talk about how quantitative measures can be misleading indicators as many factors impact the numbers. Maybe qualitative measures provide more accurate insights. But how do you accurately capture this information?

In one of my favorite blog entries, “Innovation Lessons from the Apprentice,” I discuss how measuring hot dog sales, stopped one team from being creative. As a result, their competitor, who was not constrained by the numbers, made three times the profits of the numbers-driven team. Read this article. I suspect most companies are measuring hot dogs, not results.

When companies try to measure innovation, they are really measuring innovationS.

InnovationS have a start and end. You can measure the amount of effort put into developing these ideas and the value they produce. Some common measures are:

  • Number of ideas generated
  • Number of people who contribute ideas
  • Number of ideas selected and implemented
  • Economic value generated from implemented ideas
  • % of revenue from products introduced in the last year

The big question is: How do you know if your organization is innovative enough? How do you measure innovation (without the “s”)?

The answer: When your business achieves its overall performance targets. This is real innovation – innovation as a capability – and not just an innovation pipeline. This is embedded innovation that happens real time, and, as a result, is much more difficult to directly measure. The only real measures for this are business results.

At the end of the day, these are the only measures that really matter.

Are you measuring innovations or innovation? Or, in other words, are you measuring hot dogs or results?

P.S. Be sure to read my blog entry entitled “Is Your Organization Anorexic?” It explains why I chose the picture I did. In short, companies are obsessed with measures which causes them to get poor results. People too can become obsessed with numbers (e.g., weight) and miss out on what matter most (e.g., health).

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3 Responses to “Measure Innovation NOT InnovationS”

  1. Brad on March 25th, 2009 10:01 am

    Hey Steve,

    Great point – people get too distracted trying to measure innovation as an end to itself. I wrote a similar blog entry, “Want to be innovative? Stop trying to innovate and start solving problems” (http://leaderquest.blogspot.com/2008/03/what-to-innovate-stop-trying-to-be.html).

    It’s amazing how innovative you can become when you have a real business problem with real constraints to overcome.

  2. Steve Shapiro on March 27th, 2009 8:47 am

    As always Brad, you provide a great perspective. Thanks!

  3. Kan innovatie echt gemeten worden? « directeursagenda.nl on June 1st, 2010 3:12 am

    [...] denk zelf van niet. Het meten van innovatieS is, zoals Stephen Shapiro het in zijn column van vorige week zegt, heel anders dan het meten van innovatie. Innovatie komt per definitie voort [...]