How Do You Measure Innovation?


Share on LinkedIn

A very interesting post on Blogging Innovation got me thinking today. We measure profits, lead generation, market share, and other vital aspects of growth. But how do we measure innovation?

Saul Kaplan is interested in outcomes as a measurement. He puts it in terms of social value:

… the obvious question is this, if Boston, NYC, and San Francisco are the top U.S. innovation cities why are their poverty rates so high … I thought innovation was about delivering value and solving real world problems.

There is, of course, a metric for invention: the patent. We talk about companies and universities that have x number of patents. But patents won’t do Yoyo patent, 1886as a measure of innovation for two reasons:

  • They’re a trailing indicator – patents take five years on average
  • Patents only address one of the three dimensions of innovation

Inventions – new products or methods that achieve their goal by original means – can be patented. But innovation – creating new value, new opportunities, new ways of solving problems – has 3 dimensions:

  • Product innovation (the aforementioned invention) – designing a better product.
  • Process innovation – improving the process by which value is created
  • Promise innovation – creating new business models that deliver value

It’s much harder to measure all of these dimensions. But it’s a worthwhile challenge, and I’m glad Kaplan has spurred some thinking on the issue.

Rather than go into detail about the three dimensions here, I’ll talk about them in my next post.

Republished with author's permission from original post.

Thompson Morrison
Thompson Morrison has spent the last couple of decades figuring out how companies can listen better. Before co-founding FUSE, Mr. Morrison was Managing Director of AccessMedia International (AP), a consulting firm that provides strategic market analysis for the IT industry. His clients included Hewlett-Packard, Compaq, IBM, and Vignette.


Please use comments to add value to the discussion. Maximum one link to an educational blog post or article. We will NOT PUBLISH brief comments like "good post," comments that mainly promote links, or comments with links to companies, products, or services.

Please enter your comment!
Please enter your name here