It may or may
not have occurred to you how important it is to measure the innovation of your
own business. However, if you do not
look into the efficacy and processes within your company, there is no way for
you to know how well your organization is truly running, and in which areas
improvement is needed. Of course, if you
want to measure the innovation of your business, you will need to have a
technique to use to gauge the different elements to be considered.
Traditionally,
these elements have consisted of counting defects, measuring costs, and
tracking cycle times. Today, as we
understand businesses processes better, it has become a bit more involved but
no less achievable.
With
improvement strategies such as Six Sigma – a set of techniques developed by
Motorola that focuses on the process of improvement within a business – there
are ample measures available to recognize if your business is achieving its
potential, or if it is lacking on one or many levels.
There are
primarily five areas of measure for innovation, which include:
1.
Performance
– your company’s ability to provide a total solution in relation to its
requirements and its competition
2.
Quality
– the number of defects and the number and rate of delay
3.
Timing
– its speed to the market, including its schedule for internal development
(also known as cycle time) and its external market timing.
4.
Finances
– revenue expectations, costs, margins
5.
Development
costs – for specific projects
Additionally,
there are a number of sub-categories for measuring innovation within your
business. These include:
·
Turnover
of personnel
·
Percentage
of product and/or service tests passed
·
Percentage
of reuse (the number of tested items that were borrowed)
·
Number
of specification or requirement changes needed
·
Percentage
of new parts (the number of items that are untested)
·
Percentage
of unique parts (potential areas for difficulty in integration)
·
Percentage
of new vendors
·
Percentage
of staffed to plan (including times of over-staffing and under-staffing)
·
Percentage
of designated time lost to undesignated projects
As you can see,
there is quite a bit to consider when you wish to measure the innovation of
your business. This often explains the
inclination for businesspeople to put off such measurements. However, by doing so, you are only holding
back from the ideas, changes, and potential that you could be offered from the
result of these measurements. The best time for you to measure the innovation
your business is today.