Managing the internal evaluation of the innovation process
Innovation initiatives require ongoing feedback, especially customer-centered initiatives. For example, during an ideation program, the evaluation of the number of quality submissions is as important as evaluating individual idea submissions. Sometimes it is about assessing what isn’t working and then determining the changes needed. The goal is to execute a valuable and repeatable framework for managing innovation and your innovators.
However, the internal evaluation of the innovation process must have a framework that is relevant to your company and its objectives. Your company centric framework can help reduce uncertainty and acquire valuable feedback. In addition, every decision made at each gate should support the change process that your company needs to evolve and be successful.
Why use a Framework?
Each phase of your innovation framework consists of several different activities that your management team must carry out, including cross-functional collaboration. There are basic activities such as gathering information and communicating updates to your innovators to more complex tasks such as reducing risks and consistently analyzing outcomes of the initiative. All of which are then inputs into the next steps of your framework.
While one your framework’s ultimate goals is to guide your decision on whether a product moves forward, various phases within your framework should address three important matters to bring you to that decision. For example, consider the following three analysis points.
- Quality of implementation
- Business rationale
- Action strategy
The quality of your implementation checks the execution of your previous step, whether it was done efficiently or not. Your business rationale looks at the big picture, from an economic and business perspective. Lastly, your action strategy double checks your overall plan for the prioritized project and the resources you have assigned to them.
At each phase, your idea or concept meets a specific gate, which all have a standard structure. They follow three different elements:
Your criteria is a set of questions or metrics that should be set from the beginning, during your strategic planning, even though it can be changed throughout the process to meet demands. Criteria is crucial in order to determine a result and to prioritize concepts. Therefore, it must be effective, operational, realistic and discerning. Your criteria can be:
- Must meet: questions/criteria that must be met
- Should meet: rating trait that are added to a point-count scheme
Some examples of criteria for must meet is strategic alignment, possibility of technical viability, positive return vs. risk. Examples for should meet are rated from 0 to 10 and can be strategic (alignment/importance), product advantage (benefits, better fit for customer needs, value), market (market size, growth, competition), synergies (marketing, technological, manufacturing and processing), technical viability (gap, complexity, uncertainty) and risk vs. return (profitability, return, payback period, certainty of return).
Outputs, on the other hand, are your outcome of the gate review. It’s your final decision at that stage. Here you should also get organized for your next gate, creating a set of deliverables.
What are the most important gates?
The internal evaluation of the innovation process can’t be ignored and an intra-organizational perspective is needed in order to understand all of the challenges you will face. Your strategy and the organization of roles will define your internal system of innovation. Innovation roles can be formal or semi-formal and may be an explicit part of the project, whether related to the innovation team or an ideas management system. However, roles can also be informal, those who voluntarily take on a role.
When managing your internal innovation process there is a lot of uncertainty. It requires the engagement of various stakeholders, a wide-range of internal processes, continuous monitoring of the company and the market, the management of specialized resources and structural agility for continuous reconfiguration within the company. For this reason, effective management of internal communication is fundamental.
Here is a list of innovation gate decisions that you can perform in order to achieve your objectives:
- Identify ideas
- Constructing strategies
- Mobilizing resources
The first process is prospection, which entails monitoring technological tendencies, monitoring consumption tendencies, monitoring competitors and constructing and analysing scenarios. Your team should be carrying out the prospection process, basing research on your objectives. You should look for the current tendencies of technical solutions and benefits to meet the current and future needs of your customers and also understand the progress of your competitors for tactic interaction, also mapping out future scenarios.
At the ideation gate, you should be generating and evaluating ideas internally and with the help of external stakeholders. Group work is key to this phase! These ideas can come about in many ways, for example, in workshops, brainstorming sessions, ideation contests and with the help of an innovation broker. In addition, it is important to frame the idea in an acceptable way in order to communicate it to other and further develop it. Don’t forget to capture your ideas, keeping them organized and stored for future use. The viability of ideas may change depending on the market that’s why it is particularly important to filter your ideas, especially those unaligned with your objectives. It takes time and effort to develop new ideas, therefore, you should develop a filtering process and criteria for this gate.
Next you should construct your strategies, by drawing up a product plan, which should also be aligned with your business model and portfolio. Your team will decide which ideas to explore further. It is also the time to make a roadmap of your products and services for future use. The evolution of these ideas should be met with specific criteria, which play a part in your business model. So, by balancing your portfolio, you will be able to better promote favorable ideas and kill bad ideas, selecting and prioritizing projects to be carried out. Overall, you will maximize value and balance and align your strategic plan.
In addition, it is important to collect, categorize and present information based on:
- Present problems or problem areas in the business
- Customers and markets
- Technologies and company strategies and objectives.
Doing this can also help you and your team to generate more ideas.
At the next gate, you should mobilize your resources, because you need to determine your investments and validate the viability of your product or service. When your idea is developed enough, you can then determine the investment needed to validate its viability. This includes its value proposition, competitive advantage and its possible returns. In particular, you should be searching for internal or external resources in order to carry out the prioritized projects. The allocation of mobilized resources is important at this gate.
Here, your concept should also be clearly defined. You should continue further investigation and collect more information, as well as model and prototype the product or service in order to check its viability. It is a learning experience and you should be open to possible failure at this point in the game. Concept refinement and evaluation can also occur at this stage. At the end, your product will meet the funding gate that will decide whether it should be resourced and further developed.
The implementation gate is a product and technology development process at the heart of the innovation process. The output of your implementation process is are developed concepts. That’s why this stage can also be considered a demo development plan. It is used to provide a proof of concept demonstration to customers and help you to develop and check the product from its conception to launch. If you are a start-up, this could be a product for non-paying customers. This plan will also help you to cut down on investment required to validate key hypotheses with targeted customers.
At the evalution gate, you will evaluate your final results and performance for continuous improvement. The gate could also be use for customer value validation, which allows you to understand the value to the customer, indicated through their interactions with the demo product. If you are able to define and evaluate the successful metrics and define and monitor indicators for the innovation process, you’ll be moving in the right direction. In this way you can prepare a growth plan for your future success.
Innovation management processes are responsible for various activities and functions, therefore, it is important to map out relationships between the functions and develop routines to maximize and speed up the innovation process. In addition, your organizational context is crucial for the people who carry out these processes, because they are important to the innovation process, always connected to other stakeholder, the projects and the company. You should be continuously encouraging and fostering innovation activity. It’s all about creating a culture conducive to innovation: adaptable, diversified and tolerant.
The internal evaluation of the innovation process will uncover the the strengths and weaknesses of your company, resources potential, structure and infrastructure and its core competencies. In order to have on-going success you must adapt to uncertainties and rapid changes in the market. The readjustment of your priorities play a key factor the success of these methods and the effectiveness of your innovation management will ultimately be restricted if your company isn’t continuously learning and developing its decision-making processes.