The typical linear and often siloed mindset that we have for much of our innovation thinking within our business organizations, has to rapidly fall away. We are in the ‘cusp’ of a fundamental change that technology, platforms and connected ecosystems will bring into the mix for connecting and collaborating in dramatically different ways than the past.
One of the implications will be our need in measuring and the metrics within companies. The measurement of inputs, throughout and outputs need to become far more focused on delivering speed and scale potential as the critical points. We are far more needing to focus on the outcomes as our primary point of measurement.
This is a further post on discussing outcomes as the focal point of our innovation measurements, following my recent one of “Shifting to Ultimate Outcomes”
Recognizing the emergence of the outcome economy
The outcome economy which is emerging has many implications within it and how we measure and value these will become increasingly important. Companies will need better data to calculate costs, evaluate its potential value and will be modelling far more the risks and tracking the factors required to deliver within any outcome-based value promised.
Many organizations are struggling with their metrics and ways to measure the progress and success of their business. From this writer’s point of view their innovation activity gets caught up in plenty of unintended consequences, to put it mildly, in wasted debate, discussion & bad decisions through wrong measurement criteria.
Firstly, we are still locked in the old paradigm of thinking this is an industrial economy where we set about measuring inputs to innovation (R&D expenditure, capital investment) and then focused on the intermediate step of throughput and then outputs (publications, production units, patent filing, end products).
We also perceive innovation far too much still as an activity within just one company – viewed as linear, with considerations for services more of an after thought (like ‘bolt-ons’). Production systems still remain far too often the driving force of performance judgement.
There is always a healthy debate on who “owns” innovation within any organization. Often it can boil down to where the innovation concept is along the pipeline is or who has been designated with manoeuvring or piloting the innovation through its different stages.
The reality of lasting ownership is much tougher; there are huge, often yawning gaps, in innovation accountability. The right answer should of course be everyone but making that statement on its own is a little bit of a cop-out, an easy answer to a complicated dilemma. So let me offer a connected way.
Working through the Executive Work Mat , jointly developed with our friends at Ovo Innovation , this Work Mat was designed for many reasons but principally to gain leadership engagement within all things involving innovation. One of its overarching principles was the quest to gain alignment from the top, at board level, through its interconnected structure and their strategic inputs so as to establish and make the critical connections all the way down and throughout the organization.
What we needed also was putting in place a fairly rigorous ‘litmus test‘ to establish if this is achieving the positive reaction required and the Work Mats intent.
In the past few weeks I have outlined the existing gaps at the leadership level on innovation engagement and innovations continued lack of being integrated into an organizations strategy. Time and time again there are new reports, surveys and different comments made on this serious disconnect still going on that needs clear resolution.
It is always pleasing to sometimes be on the same track as the Big Consultants, for working on and moving beyond the trends they are spotting and highlighting, into some clear tangible solutions, to help resolve these. Recently McKinsey Quarterly conducted an on-line survey of just under 3,000 executives on issues surrounding innovation. The report is entitled “Making innovation structures work”- see the link below.
They confirm much that I have seen or gained through my research and point very specifically to the key difficulties organizations are presently having around innovation. Continue reading