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.
At present we are seemingly in a state of flux, we are learning to move from linear innovation models into more dynamic ones that are increasingly forming around innovation ecosystems.
Our whole understanding of innovation is changing; we are evaluating and changing our existing focus from closed (internal orientation) into open (external orientation) thinking for accelerating and improving our innovation performances.
Regretfully we are not yet fully equipped to manage within these new innovation ecosystems. We need to give the factors an increasing focus and lead into a better emerging theory of leading or good practice.
Measuring innovation in different ways is becoming important