As a follow-up to my recent post, where I mentioned that organizations that formally manage innovation are more successful, I wanted to probe further into the question “How do we know if our innovation process is successful?”
For one thing, instead of focusing on the number of new products and services you bring to market, measure the percentage of revenue those new products and services represent. An innovation can only be successful if it has commercial viability, otherwise why innovate? An organization can only say that it has a culture of innovation if a large percentage of its’ revenues come from products and services that didn’t exist three or four years ago.
If you want to know whether or not your organization is successful at creating innovation, look at the breakdown of your revenue. How much of that revenue is represented by products and services that did not exist five years ago? If the answer is less than 30% then you are not an innovative company. You may be a successful company (and there’s nothing wrong with that), but you’re not an innovative company.
How will you ensure a culture of innovation in your organization?