Innovation management is a big buzz word in the business world these days. Everything seems to hinge on innovation, and so everybody is always looking for ways to get more innovative ideas from their team members.
Innovation itself is an intangible asset, so how can you truly measure the success of your innovation management program? Here are 4 key factors you should examine to determine the success or failure of your current innovation efforts.
Number of projects brought to fruitionOne of the first statistics you should examine is the number of projects that your program has successfully generated and guided to completion. While you might think that simply looking at the number of ideas generated is measure enough, this is not the case. Even the barest of innovation efforts can collect ideas, but a truly successful innovation management program gathers those ideas, pinpoints the ones with the most potential, and provides a path for those ideas to be brought to life.Often, this process is best facilitated through the use of innovation management software, which can help to track the progress of each idea submitted. The more often an idea is put into action within your business, the more successful your innovation management program is.
Impact on employee productivity
A successful innovation management program always improves the productivity of the employees involved. One study conducted within a Malaysia-based utility company examined the impact of different types of innovation on employee performance and found that they had a significant impact on employee performance in numerous areas, including productivity.Depending on the size of your business and the resources available to you, you may have a difficult time precisely measuring employee productivity. However, an innovation management program that encourages employee participation improves worker engagement, and studies have shown time and time again that high levels of engagement lead directly to improved productivity and higher rates of job satisfaction among workers. So, if you notice happier, more productive employees, then your innovation management efforts are working.
Customer satisfaction and turnover rates
Customer turnover can be a major drain on a company, but a successful innovation management can reduce the number of customers that are leaving your business. Front-line employees work directly with your consumers, and thus, they have a better idea of what complaints and suggestions your customers have. In a successful innovation management program, your employees will be able to take their knowledge of common customer concerns and offer suggestions on how your business can improve – thereby, solving the common problems and improving customer satisfaction.One example of this was found among ten cosmetics companies in Iran. The study examined the impact of innovation on customer satisfaction and found that innovation in product presentation alone had an immediate positive effect on the satisfaction of customers. So, if your customer satisfaction ratings have gone up, and you’re seeing lower rates of customer turnover, odds are you have a successful idea management program in your business.
Growing profits or net income
Researchers at MIT conducted a study of 28 public companies, examining data that spanned from 2014 to 2016. The data that they examined showed a significant correlation between the number of employee ideas selected for implementation, and the rate of growth in profit or net come. The more ideas that were put into action within the company, the more their profits grew. This was a heavy indication that more employee-driven innovation has a direct impact on driving up a company’s profits.While there can be many factors that influence your company’s profits, steady growth can be a good indicator that your current innovation management program is working. This is especially true if the other statistics mentioned in this list are yielding positive results for your business.
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If you’re trying to measure whether your current idea management efforts are successful or not, try examining these 4 statistics. If you’re getting positive results in all 4 of these categories, then you’re doing something right. On the other hand, if you find more than one of these areas to be lacking, consider revamping your innovation management program.