The causes and effects of innovation success are complex. Many of these are difficult to quantify. Questions to be answered are for example
As you can see, innovation is a far-reaching topic that has ramified roots of success on many levels and is also spinning its threads into many other areas. Thus, measuring success becomes a complex challenge. In addition, many effects are time and place shifted. For example, earnings from innovations often only come after a few years of start-up or additional sales are generated by synergies with other products.
Although the measurement of innovation is complex, this is precisely why it is so complex. There are a large number of key figures and they all have their meaningfulness and thus also their ability to control. They provide information, tendencies and transparency in terms of innovation activity and thus impetus where to apply the levers. Strategic orientation is also relevant. There should always be a link between the strategic purpose of innovation and its indicators.
Thus, measuring innovation performance is a very relevant part of innovation management. According to Austrian management pioneer Peter Drucker, "You can't control what you can't measure."
The plane is the place of effect and influence. Either a key figure refers to an individual project and thus to a single innovation, i. e. a product or a service. Or the key figure applies to the entire company. This results in a measurement on
Another classification is based on the type of measurement, which distinguishes the measurement from
Key figures for measuring individual projects or innovations are closely linked to project management and the financial benefit calculation. Here is a selection of possible key figures:
The challenge here is that the individual projects are not comparable. In comparison to production, where each piece is exactly the same and thus comparable, each innovation is individual and therefore has different requirements. For example, it is difficult to compare the lead times of individual projects with each other in order to carry out a meaningful analysis.
The innovation indicators at company level cover all projects and activities and relate to innovation performance as a whole. Here are examples of possible key figures:
These key figures are used for portfolio and multi-project management and, above all, provide information about planning reliability and the resources used.
The measurement of the key figures usually refers to a time frame. The financial year is taken into account.
The determination of the key figures requires extensive documentation systems in order to have all the data available for calculating the figures. The responsible innovation manager must ensure that the basic figures are correct and that the documentation is meticulous and thorough. A mistake can make all the numbers wrong.
Many of the key figures can also be used for external benchmarking. For example, many companies disclose their spending on innovation, according to which interesting comparisons can be made. However, the peculiarities of companies and industries must always be considered and to what extent one can thus compete with other companies.
Innovation indicators are an extremely important measurement and control tool in innovation management. But the figures must also always be taken with caution, because innovation is a complex and interlinked topic. The innovation success is based on various causes in the system and has multiple positive effects in many other areas. These are facts that have to be considered individually for the definition and measurement of innovation indicators.