In this 4-part series, we take a closer look at factors that will help organizations remove barriers to innovation and tap into accelerators that have the potential to unleash transformative growth from our 2022 Innovation Trends Report Card.
Our last installment of the series is Part 4: The Execution Dilemma
In our final blog in this 4-part series, we look at the remaining execution barriers to innovation – no clear process (33%), lack of tools (22%), and no metrics (53%). All at a time when global spending on R&D reached a record high of $1.7 trillion dollars (source: UNESCO).
Let’s start with measurement. A key finding in the survey was that an overwhelming majority (53%) were not aware of any metrics their corporations used to measure innovation. However, if there was a metric, respondents said the most common used was the percentage of revenue generated by innovation (35%).
In our one-on-one interviews with innovators, many shared with us that the financial metric stifled or killed promising innovation more often than helping it to grow:
“I’ve been in a position where I had nine figure businesses and the guy running the $45 billion business would look at me say, you know, if it's not a billion-dollar business in the first year, I don't know if we're really that interested. And my point to him was, well, I hate to tell you this, but PCs weren't a billion-dollar business the first year.”
A second key barrier was lack of process (33%) – digging into this a bit more, it occurred to us that we should be asking about how ideas (innovation) turn into commercialized products that are either sold to generate revenue or put into production by an organization to reduce costs (e.g., IoT or automation). The most common way to drive these efforts are through a phase gate or product development process. Yet, in our survey, 62% of respondents said their company was not using this.
Finally, era of software-as-a-service (SaaS), workflow automation, mobile phone apps, and Customer Relationship Management (CRM), we know there is technology to aid the innovation processes, so we wanted to know what tools organizations are using to manage innovation.
CRM (53%) and project management (44%) topped the list, with idea management (20%) and none (23%) coming in at the bottom of the survey. When asked how well these tools were working, most (38%) felt they “could be better.”
While most corporations have several software or automation tools that can help manage everything from sales to the supply chain, there is nothing in the field of innovation to aid or measure the innovation process. Could it be time for organizations to use purpose-built CRM and project management tools to accelerate and scale innovation?
Final Thoughts
Wrapping up this 4-part blog series, there are three questions that best summarize the 2022 report:
How satisfied are you with your culture to support innovation?
How well is innovation working for you?
How satisfied with are you with the current tools for innovation?
The answers:
Very satisfied (23%)
It sort of works (22%)
They could be better (38%)
Ending this year’s survey on a positive note, despite its challenges, an overwhelming majority of respondents (67%) said that innovation is getting easier within their organization
The final report card – innovation is getting easier but there is an opportunity to fill the gap in execution by focusing on ways to optimize, scale, and measure the process of innovation better – especially in light of the fact that R&D spend at $1.7 trillion broke the global record last year. Perhaps it's time to get smarter about the way we innovate, not just the ideas we generate.