Information without structure is a hurricane. It is random debris flying about, power lines down — there goes a cow flying by — total chaos. If the data, analysis, and feedback surrounding your innovation strategy is whirling around in turbulent circles, progress, let alone success, is extremely challenging. For today's innovation managers, organized, accessible, and accurate reporting is what calms the winds. It flows from and back to the whole team and serves as the barometer for the goal that matters most: closing revenue gaps.
Reporting is the discipline of tracking key performance indicators (KPIs) and relaying that information to the relevant parties. It’s a critical innovation function that benefits a wide range of stakeholders, including executives, department heads, and innovation team members. Reporting takes raw data and transforms it into actionable intelligence that:
- Enables timely and informed decisions
- Allows stakeholders to monitor progress and performance
- Fosters a culture of improvement
- Optimizes innovation processes to function at their highest levels
It’s one of the six innovation disciplines, which also includes prioritization, roadmapping, governance, methodology, and enablement.
We want to explore how growth innovation is driving changes in reporting, how data integration is transforming the metrics used to compile those reports, and how reporting needs to evolve in the future.
But we’ll start by taking a moment to define growth innovation.
What is growth innovation?
Growth innovation is an innovation management philosophy that sets growth as the single most important innovation outcome and manages every step of the innovation process accordingly. It accomplishes this by treating the entire innovation portfolio as a single business unit that scales up to create growth.
Growth innovation happens when an enterprise radically commits to three principles:
Growth:
The growth innovation process starts by identifying your enterprise’s growth objectives and revenue gaps. All innovation activities are then prioritized to address at least one growth objective and close these gaps.
Visibility:
The growth innovation enterprise unifies all its innovation management data, both historical and current. This guarantees that every stakeholder has access to the information necessary to make informed and timely decisions. This also enables managers to use the data to set useful metrics, ensuring pipeline throughput and effective governance in the event of issues.
Orchestration:
All decisions are made within the context of an interdependent innovation portfolio, so the entire ecosystem is working in tandem to meet enterprise objectives. The projects in the pipeline are all prioritized based on their ability to contribute to these goals and close existing gaps. Consistent, cross-functional portfolio reviews ensure that everything stays on track.
Growth innovation represents the next evolutionary shift for innovation. It’s also critical to examine how reporting needs to evolve alongside it. However, before we do so, we’ll take a brief look at previous iterations of enterprise innovation and the changes to reporting that have already occurred.
How Growth Innovation Is Prompting Reporting to Evolve
In the first generation of innovation (1940s–1980s), research and development (R&D) often reported to executive steering committees. This direct communication was efficient, but came bundled with an inherent challenge: engineers and scientists had to present their findings and activities to executives. This meant both parties had to bridge a significant gap in knowledge and expertise: STEM experts needed to communicate their progress to business managers, and business managers needed to interpret the reports of scientists. The boardroom and the R&D department spoke different languages, but since innovation was generating substantial income, R&D was given a long leash.
How Reporting Changed in Innovation’s Second Generation
The next generation of innovation began in the mid-1980s, kicked off by a shift toward maximizing shareholder profits. This change in corporate philosophy led to a profound change in how every department functioned and reported on its activities. Performance metrics became the dominant language of the enterprise, including R&D, manufacturing, and commercial teams.
This emphasis meant that every department was held accountable for its contribution to the bottom line. The prevailing wisdom of the day became, “you can only manage what you can measure,” meaning that without detailed reporting, it was impossible for managers to adequately oversee, optimize, or improve their areas of responsibility.
However, the very nature of innovation presented a challenge to this metric-centric shift. A lot of the work of innovation is difficult to measure and quantify. The process of discovering and developing new products and technologies, and the market demand for new concepts was challenging to assign metrics to.
So innovation teams focused on what they could measure: progress through the innovation pipeline. This meant reporting on milestones, timelines, and budgets while omitting significant insights into performance, value, and potential impact. And while reporting on pipeline progression offered some sense of control and accountability, it began rewarding incremental, predictable advancements.
This propelled a shift in innovation development toward more easily measurable downstream innovation. This manifested in a couple of ways:
- Iterating on existing technologies
Rather than investing in the high-risk, high-reward innovations of the past, the focus shifted toward refining, enhancing, and optimizing existing products and services. This offered more predictable outcomes, shorter timelines, and more measurable processes. - Pushing existing products into new markets
The next focus was to adapt existing technologies for all-new markets. This tended to require less risk and allowed for more traditional business case analysis, rather than the more ambiguous long-term investments associated with developing game-changing new technologies.
Reporting Needs to Experience a Major Shift
This focus on second-generation innovation reporting introduced a problem that growth innovation is solving. Knowing the number of projects at various phases in your Stage-Gate pipeline doesn’t really tell you how you’re going to close the gaps between the revenue you’re making now and the revenue you need to make in the future.
Under growth innovation, innovation KPIs are designed to indicate a project’s potential (and, post-launch, actual) contribution to reaching enterprise objectives. This means that growth-innovation KPIs aren’t simply process-oriented; they’re focused on outcomes, directly linking innovation efforts to the organization’s operational goals.
Reporting’s Relationship With Other Disciplines Under Growth Innovation
As a discipline, reporting is critical to the enterprise’s innovation activities, offering a view into the processes and establishing necessary feedback loops. Within the context of growth innovation, this means you’re relaying meaningful information to innovation stakeholders — information they can use to improve the disciplines that make up their responsibilities.
The impact that growth innovation has on the other disciplines also enhances innovation reporting.
Let’s examine some of the benefits that other disciplines receive from enhanced reporting.
Reinforced Prioritization
Prioritization within a growth innovation context ensures that every greenlit project is aligned with at least one of the organization’s growth objectives and ranked accordingly. Instead of simply monitoring the progression of those projects, regular reporting assures that they have stayed aligned with those objectives throughout development.
Augmented Roadmapping
Your reporting becomes historical data, which, in turn, becomes a powerful tool for planning. This collected data greatly enhances roadmapping, helping you create more accurate timelines and milestones and improve predictability.
Enhanced Enablement
The data generation through growth-innovation reporting is fed into your innovation management software, strengthening your enablement system and providing an up-to-date and comprehensive view of your entire innovation portfolio.
The benefits of growth innovation impact other disciplines through reporting, but the adverse is also true. Reporting is strengthened by growth innovation’s effect on the other disciplines, creating a rising tide that continuously lifts all the disciplines that innovation relies on. Here are a few of the critical ways that growth innovation boosts reporting:
Clarity in Reporting
Under growth innovation, every initiative and project is directly linked to one or more enterprise growth objectives, and innovation leaders set KPIs that measure their contribution to those objectives. By defining the goals and KPIs from the outset, reporting expectations become clearer, eliminating ambiguity and ensuring that the activities you’re reporting on are more aligned with how you report on them.
Ease in Reporting
Growth innovation governance socializes and enforces the policies for decision making and course correction. This helps projects stay on track, making the reporting process less burdensome. Instead of scrambling to put together reactive analyses for initiatives veering off the rails, you can focus on generating reports that reflect genuine progress and highlight areas for optimization within a well-defined structure.
Accuracy in Reporting
At the heart of growth innovation enablement is an innovation management software that tracks and syncs every change across the entire portfolio, intuitively accounting for interdependencies. This means that any changes made are automatically accounted for in your reports. This means that you never have to wonder if another party neglected to inform you of something important, and it eliminates the risk of reporting against outdated goals or using obsolete information.
Transitioning to Growth Innovation Reporting Hinges on Two Critical Factors
Growth innovation boosts the effectiveness of the disciplines that contribute to innovation activities. But adopting growth innovation requires more than a shift in priorities and paradigms. It relies on two vital elements:
1. Effective Change Management
Growth innovation enterprises enjoy comprehensive visibility of their entire innovation portfolio. This allows them to generate accurate, real-time reports on demand, and more importantly, it enables stakeholders to report on KPIs that actually show how projects are contributing to the enterprise’s growth goals.
However, this visibility only happens when all your innovation management data is stored and accessible in a single system. Unifying and restructuring your data is no small task, and nobody can do it alone.
This is why change management is vital to the growth innovation transition. Leaders need to get buy-in from across the organization: all your teams on board with the growth innovation vision. Then you need to get them to actually migrate their data into the new unified system.
It’s a tall order, but the benefits on the other side are worth it.
2. Effective Innovation Management Software
A dynamic IM software sits at the center of growth innovation. Your various activities shouldn’t rely on multiple digital platforms spread out across departments. Growth innovation requires a single hub for all innovation data and governance.
When you’re compiling reports, you shouldn’t have to track down the latest information or weed through pages of superfluous data. The data should be readily available and easily filterable for the information you need when you need it.
The same software that houses all your current and historical innovation data should facilitate your prioritization, roadmapping, pipeline monitoring, and reporting. This ensures that your objectives, activities, and governance are all informed by timely and accurate data.
Upgrade How You’re Measuring Innovation
Reporting is crucial for innovation enterprises, providing valuable insights into the effectiveness of initiatives and guiding strategic decision-making. It helps secure buy-in throughout the organization, informs investment decisions, and ensures that projects are aligned with your organization’s highest goals.
Growth innovation supercharges this invaluable discipline.
First it simplifies report compiling because all the data from your entire portfolio is stored in one place. You don’t have to ask others to email you that last analysis or wonder which drive it’s on. The comprehensive and up-to-the-minute data you need is available with a quick query.
Next, it ties your reporting to clear KPIs that align innovation activities with the organizational targets you’ve set. You don’t have to cobble together a handful of vanity metrics or simply offer input about where projects are in the pipeline. Your reports will offer clearly defined measurements about the performance of the entire portfolio, which leads to more predictable, successful innovation in the long term.
If you’re looking for an IM software that you can trust to be the hub for your transition to growth innovation, Accolade is the answer, providing you with the data visibility and transparency you need for more productive reports so you can make more informed and strategic decisions.
Get a hands-on look at how Accolade can transform innovation for you, book a demo.