Innovation Basics: The Stages of Determining Innovation ROI

By Michael Watkins

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Changing the world, one idea at a time has to start somewhere. Even the organizations that regularly bring about revolutionary change had a first step to take on their journey. In the Innovation Basics series, we focus exclusively on what that first step could look like for newcomers to the innovation world. Follow this guidance to achieve faster, better innovation.

In today’s fast-paced business landscape, innovation is more important than ever. It’s the driving force behind progress and growth, allowing companies to stay competitive and adapt to market shifts. We know that, for innovation to truly make a lasting impact, it needs to be aligned to overall business strategic objectives.

Wazoku’s Challenge Driven Innovation® methodology is proven to help companies in doing just this. The methodology that underpins our market-leading, configurable platform, Challenge Driven Innovation® allows you to maximize the return on your innovation investment.

In this blog, we’re going to look at how you can quantify that value. The ability to communicate this to stakeholders is often what makes or breaks a program’s ability to secure the resources necessary to create long-term success.

Stage One: Define What to Measure

You cannot judge what you don’t define: plain and simple. The first step in determining the impact and the relative success of your program is deciding what success looks like. It is obvious to assume that, for many, the key thing to measure is monetary.

However, change takes different forms depending on the goals you’re aligning with, so don’t be afraid to question if that is really what you want to measure the success of your program against.

Stage Two: Transition from Activity to Impact

Once you’ve laid those foundations, and you’ve run your initial Challenges, the metrics you started out with will need a review. Starting off with ‘Activity Metrics’ which measure things like engagement is advisable, but soon you also need to look at ‘Impact Metrics’. For a brief overview on what defines these two sets of metrics, check out this blog!

Stage Three: Demonstrate Progress

A great reason for reviewing these metrics (Stage Two) is that it makes it easier to demonstrate the progress of the program. It builds the outline of the story you want to be able to relay to key stakeholders, showing the initial take-up of the program and the quick wins you can prove.

This shows that the program is having a positive effect which, broadly speaking, is what those who sign off on resource – whether that be monetary, personnel, or time – want to see.

Stage Four: Determine the Right Frequency

The first three stages almost feel like a cycle in itself, but as with everything else in innovation, your approach to ROI never really ends. Once you’ve demonstrated the progress of your program to date, it then becomes vital to decide the right frequency with which you report on your program.

Do this too frequently, and you lose the ability to tell an accurate story of the program’s impact. Too infrequently, and you risk missing out on opportunities to resolve issues with the program, as they get lost in the weeds.

In this blog, we’ve shown how Challenge Driven Innovation® helps companies convert innovation intention into regular impact. We’ve then discussed how to assess the ROI that your program is delivering and shared some advice on how to get that right.

This brings to an end the Innovation Basics series that discusses how companies can organize for innovation. For more details on any of these topics, check out our series of guides here!

By Michael Watkins

Michael is Wazoku's Product and Brand Marketing lead. Away from the office, he's our resident film buff, so if you want some recommendations for a night in front of Netflix or a trip to your local cinema, get in touch with him!