How well do we manage innovation?

This simple self-assessment tool focuses attention on some of the important areas of
innovation management. Below you will find statements which describe 'the way we do
things around here' - the pattern of behaviour which describes how the organization
handles the question of innovation. For each statement simply put a score between 1 (=
not true at all) to 7 (=very true).

Around here..

Statement Score 1= Not true

at all to 7 = Very
true
1 People have a clear idea of how innovation can help us
compete

2 We have processes in place to help us manage new

product development effectively from idea to launch

3 Our organization structure does not stifle innovation but

helps it to happen

4 We have good 'win-win' relationships with our suppliers

5 There is a strong commitment to training and

development of people

6 Our innovation strategy is clearly communicated so

everyone knows the targets for improvement

7 Our innovation projects are usually completed on time

and within budget

8 People work well together across departmental

boundaries

9 We are good at understanding the needs of our

customers/end-users

10 We take time to review our projects to improve our

performance next time

11 People know what our distinctive competence is - what

gives us a competitive edge
12 We have effective mechanisms to make sure everyone
(not just Marketing) understands customer needs)

13 People are involved in suggesting ideas for

improvements to products or processes

14 We work well with universities and other research

centres to help us develop our knowledge

15 We learn from our mistakes

16 We look ahead in a structured way (using forecasting

tools and techniques) to try and imagine future threats
and opportunities

17 We have effective mechanisms for managing process

change from idea through to successful implementation

18 Our structure helps us to take decisions rapidly

19 We work closely with our customers in exploring and

developing new concepts

20 We systematically compare our products and processes

with other firms

21 Our top team have a shared vision of how the company

will develop through innovation

22 We systematically search for new product ideas

23 Communication is effective and works top down, bottom

up and across the organization

24 We collaborate with other firms to develop new products

or processes

25 We meet and share experiences with other firms to help

us learn

26 There is top management commitment and support for

innovation

27 We have mechanisms in place to ensure early

involvement of all departments in developing new
 products/processes
28 Our reward and recognition system supports innovation

29 We try to develop external networks of people who can

help us - for example, with specialist knowledge

30 We are good at capturing what we have learned so that

others in the organization can make use of it

31 We have processes in place to review new technological

or market developments and what they mean for our
firm's strategy

32 We have a clear system for choosing innovation projects

33 We have a supportive climate for new ideas - people

don't have to leave the organization to make them happen

34 We work closely with the local and national education

system to communicate our needs for skills

35 We are good at learning from other organisations

36 There is a clear link between the innovation projects we

carry out and the overall strategy of the business

37 There is sufficient flexibility in our system for product

development to allow small 'fast track' projects to happen

38 We work well in teams

39 We work closely with 'lead users' to develop innovative

new products and services

40 We use measurement to help identify where and when we

can improve our innovation management
When you have finished, add the totals for the questions in the following way:

Questions Total Score (= Total

divided by 8)
1,6,11,16,21,26,31,36 Strategy =
2,7,12,17,22,27,32,37 Processes =
3,8,13,18,23,28,33,38 Organization =
4,9,14,19,24,29,34,39 Linkages =
5,10,15,20,25,30,35,40 Learning =

Now plot a profile for the five dimensions.

Using the innovation audit

Below you will find the audit questions together with a brief explanation of what a low
score might mean and what steps you might take to improve that situation.

Around here..

Statement What does a low score What can I do about
here mean? it?
1 People have a clear idea of Lack of a clear innovation Develop a strategy a
how innovation can help us strategy or failure to clear statement of
compete communicate it effectively where and how
innovation will take
In the first case the issue the organization
may be that there is a forward.
general recognition of its
importance but no clear Use policy deployment
understanding of how tools to communicate
innovation will take the and build buy-in to
business forward. What the strategy
are the targets for change?
Which projects will be
undertaken and why?
Whats the balance
between simple
incremental improvements
(do better innovations),
and more radical (and
higher risk) do different
projects? Is the focus on
product, process or other
kinds of innovation?
Exploring, discussing and
making explicit the
underlying strategy is
strongly linked to
innovation success.

Alternatively the problem is
that there is a strategy but
it is not communicated
effectively. People dont
know where and how
innovation can help the
 business move forward.
They see change, if and
when it happens, as
something which happens
but which they do not
contribute to (although it
may often affect them,
especially if it concerns
changes to working
processes). This can have
an impact on morale and
it also misses out on a
major opportunity to
mobilize the creativity and
knowledge of the staff to
contribute ideas and
energy to support
innovation efforts


2 We have processes in place There is a risk that projects These may be
to help us manage new will overrun in cost and symptoms of a lack of
product/service time, resources may be enough discipline and
development effectively poorly utilized and structure to the
from idea to launch innovation becomes process of innovation.
something of a gamble To improve this:
rather than a managed risk
Implement a
stage gate
system

Put in place
good practice
tools and
techniques for
project
management
and review

Ensure early
involvement
and concurrent
working across
the different
 groups
involved

Create cross-
functional
teams to
ensure the
relevant
knowledge and
skills are
available to the
project

Use post-
project reviews
to map the
innovation
process and
identify where
it could be
improved



3 Our organization structure The culture the way we Organizational
does not stifle innovation do things around here is development
but helps it to happen not supportive of enabling structures,
innovation people feel training, facilitation,
constrained. May be seen new routes for ideas
as too bureaucratic, too flow,
structured, too rigid, etc. Is reward/recognition
there space for innovation? linked to innovation,
Specific time allocated? etc.
Where do people take
innovative ideas? Is
innovation recognized and
rewarded?

4 There is a strong People dont feel they are Increase investment in
commitment to training and valued and may withhold training, improve its
development of people their innovative ideas. Or effectiveness.
they may be limited in Develop a training
what they can achieve by strategy. Use
the lack of skills or frameworks to guide
 knowledge the process for
example, Investors in
people
5 We have good 'win-win' Overall performance Introduce a supplier
relationships with our weakened the whole is development
suppliers less than the sum of its programme to build
parts. Failure to capitalize partnerships.
on their role as innovation Share vision about
sources and failure to overall strategy and
deploy process encourage their input
improvements in their to delivering this.
world to upgrade overall Share or provide
system effectiveness. resources to help
Open innovation training, guest
opportunity missed engineers, etc.




6 Our innovation strategy is People dont know where Policy deployment of a
clearly communicated so or how to focus their clear strategy
everyone knows the targets innovative efforts
for improvement innovation is just a slogan.
The risk is they wont
bother or else they will
innovate but in random
fashion which may not help
the organization move
forward

7 Our innovation projects are Overruns on time and/or Stage gate and other
usually completed on time budget usually mean there project management
and within budget are weak or no processes in inputs. Deploy good
place to manage projects practice tools and
systematically and techniques early
appropriately involvement,
concurrent working,
cross-functional
teams, etc.




8 People work well together Silo mentality, failures of Review and change co-
 across departmental communication key ordination
boundaries information not being arrangements. Use
shared or shared too late. secondment, cross-
Conflicts between different functional teams, early
parts of the organization involvement, quality
the whole is less than the function deployment,
sum of the parts etc.
Teambuilding and
training across the
innovation process

9 We take time to review our Without some way of Deploy post-project
projects to improve our capturing and holding on to reviews and other
performance next time learning about what works learning capture
and what doesnt work devices. Link to
the organization risks standard operating
making the same mistakes procedures and other
again and again. There is ratchets to capture
no organizational memory and preserve and
and success becomes a hit share. Codify tacit
and miss affair. experiences.

10 We are good at Products/services which Review and extend
understanding the needs of people dont buy! Missed your market research
our customers/end-users opportunities in terms of tools, especially those
their design ideas. Risk aimed at getting close
that we offer the better to the voice of the
mousetrap that no-one customer (VOC).
wants! Explore tools and
techniques which
bring in users at the
fuzzy front end of the
innovation process.
Use quality function
deployment (QFD) to
ensure the VOC gets
heard throughout the
organization.

11 People know what our If we dont know what we Develop and share an
distinctive competence is - know and more understanding of core
what gives us a competitive important, what do we competencies and
edge know which is unique or how we can leverage
hard to imitate then we these in products,
 dont really understand services and
how we will compete. processes. What are
Building an awareness of our distinctive
the things we know about strengths? And how
and can do well- means do we protect and
that innovation is not a exploit our intellectual
random set of ideas but property (IP)?
linked to areas of strength.

12 We have effective Successful innovators Deploy approaches
mechanisms to make sure understand their customers like quality function
everyone (not just needs thats a key deployment (QFD) - to
Marketing) understands message from countless ensure everyone
customer needs) studies. But it is important understands customer
that the understanding gets needs and how their
through to everyone in the innovation activity can
organization otherwise contribute to meeting
they may put their ideas these. Engage people
and energies into creating from other functions
products/services which no not just Marketing in
one wants! customer visits,
market research, etc

13 People are involved in Is innovation seen as Develop and
suggesting ideas for something confined to the implement a
improvements to licensed few and do you formalized high
products/services or risk losing potential ideas involvement
processes and input from everyone programme training,
else? The danger is also tools, process,
that ideas for new enablers
processes ways of
working may be resisted
because people werent
involved in their
development

14 We work well with Your knowledge net may Develop an open
universities and other be spread too thinly and innovation strategy
research centres to help us you could be failing to build identify key needs and
develop our knowledge the rich links needed in where to find them.
open innovation world. Develop mechanisms
Possibly reinventing to form and manage
wheels because you arent knowledge supply
aware of or using what is relationships for
 available in the wider example, through
knowledge environment Knowledge Transfer
Partnerships with
universities.


15 We learn from our mistakes Reinventing wheels, Learning and review
making the same mistakes mechanisms
again reflection tools and
aids, learning cycle

16 We look ahead in a Being surprised by Deploy futures tools
structured way (using unexpected developments and techniques
forecasting tools and not on the current forecasting, scenarios,
techniques) to try and trajectory. Too little time horizon scanning, etc.
imagine future threats and to react because not aware
opportunities until the crisis hits

17 We have effective Resistance to change, lack Deploy change
mechanisms for managing of buy in or maybe direct management
process change from idea hostile action. Lack of user
approaches which
through to successful input means weaker design ensure buy-in
implementation and lack of ownership communicate, share
visions, training, user
involvement in design,
etc.

18 Our structure helps us to Slow decisions which affect Optimize decision
take decisions rapidly the speed and flexibility of routes for example
innovative response too multi-track for big and
late for opportunities, small innovation
overruns on time and projects. Cross-
budget etc. functional teams,
concurrent working,
early involvement and
other time
compression
techniques
Lean thinking applied

19 We work closely with our Loss of important ideas Deploy user-led
customers in exploring and which can shape a better innovation tools
developing new concepts product / service. Missing crowdsourcing,
out on smoothing the user prototyping, etc. Web
 acceptance path through 2.0 approaches.
engaging early adopters, in Customization toolkit.
prototyping, Lead user workshops
recommendation and viral and methods.
marketing, etc.

20 We systematically compare Unawareness of where the Deploy approaches to
our products/services and frontier is, or what best enable benchmarking
processes with other firms practice is. You may risk of products, process
being surprised by faster, and services
cheaper or other
performance advantages.
Or you may find that all you
have are me too
products/services or
processes which are only at
or even below the
industry average.

21 Our top team have a shared No clear sense of direction Develop and share a
vision of how the company or complacent and strategic vision
will develop through comfortable without a
innovation sense of stretch

22 We systematically search Innovation is a random hit Product strategy
for new product or service and miss activity with no linked to portfolio
ideas product/service strategy. analysis
No steady source of ideas Structured search
for new products/services methods
risk of pipeline running dry benchmarking,
profiling, reverse
engineering, etc

23 Communication is effective Slow information flow, Communications
and works top down, missing elements, conflicts review and strategy
bottom up and across the and other friction affects
organization time and costs of
innovation
24 We collaborate with other Missing key source of Develop an open
firms to develop new insights and chance to innovation strategy
products or processes leverage someone elses careful understanding
competencies. Costs of of our competencies
growing your own and and what we need
reinventing wheels. Open from others. Strategic
 innovation not all the alliances and managed
smart guys work for us if relationships
we believe they do we
carry the costs of that

25 We meet and share Insulated view of the world Commitment to
experiences with other and belief in home grown learning networks and
firms to help us learn solutions. Risks being clubs. Building
surprised by other informal and formal
developments and misses networks to enable
out on learning this. Use
opportunities opportunities offered
by 3rd parties trade
associations, regional
organizations, support
agencies, etc

26 There is top management No leadership and no Explicit support and
commitment and support resources - key factor in clear resource and
for innovation innovation success and other expressions of
absence linked with failure commitment e.g.
time, godfather roles,
etc.

27 We have mechanisms in Delays and overruns in Early involvement,
place to ensure early cost, failure to meet cross functional team
involvement of all technical specs, etc. working. Project team
departments in developing Downstream fixes and their deisgn and training
new associated costs pre-project
products/services/processes

28 Our reward and recognition People wont contribute Review/develop
system supports innovation because they dont feel reward and
recognized and rewarded recognition system
linked to innovation
Build innovation goals
into appraisal
processes

29 We try to develop external Limited input and insulated Open innovation
networks of people who can view of the knowledge strategy
help us - for example, with world the closed commitment to
specialist knowledge innovation problem. developing networks.
Missing key source of Sending out scouts,
 insights and chance to using other channels
leverage someone elses web 2.0, etc. to help
competencies. Costs of build them
growing your own and
reinventing wheels. Open
innovation not all the
smart guys work for us if
we believe they do we
carry the costs of that

30 We are good at capturing Mistakes are repeated and Deploy post-project
what we have learned so loss of organizational reviews and other
that others in the memory. Problems of learning capture
organization can make use delays and overruns persist devices. Link to
of it standard operating
procedures and other
ratchets to capture
and preserve and
share. Codify and
share across the
organization

31 We have processes in place Risk of being surprised by Peripheral vision and
to review new technological external developments external environment
or market developments open to disruption scanning approaches.
and what they mean for our SWOT/ PEST etc.
firm's strategy

32 We have a clear system for Spreading resources too Deploy portfolio
choosing innovation thinly. Picking wrong management linked to
projects projects which dont match stage gate review
competencies or with poor
market potential. Conflicts
downstream over reasons
for choice politics etc
around pet projects

33 We have a supportive Entrepreneurial ideas and Create opportunities
climate for new ideas - enthusiasm are blocked for intrapreneurship
people don't have to leave through lack of channels, routes through the
the organization to make through lack of resources, system idea
them happen through lack of contests, innovation
commitment, through lack challenges, seed
of time and other space to funding, etc. cf 3M,
 take forward. Google and others
Entrepreneurial players
keep their heads down or
become so dissatisfied that
they leave Consequent loss
of creativity and energy.

34 We work closely with the Lack of key skills to support Develop a clear skills
local and national education new developments and strategy and close
system to communicate our inability to exploit links with external
needs for skills opportunities as a result agencies in the system

35 We are good at learning Insular view can lead to Develop networks and
from other organisations being surprised by events, structured approaches
or complacent assumptions to learn
about performance and benchmarking.
portfolio. Not learning Develop absorptive
form others may create capacity how to
vulnerabilities assimilate ideas from
outside.


36 There is a clear link between Innovation activity which Clear strategic
the innovation projects we does not move the planning process and
carry out and the overall organization forward and linkage between
strategy of the business may even represent an innovation and other
opportunity cost, starving components.
other projects of resources.
Lack of commitment or
support for innovation
projects.

37 There is sufficient flexibility Projects get slowed or Use multiple tracks
in our system for product starved of resources and idea management
development to allow small because they need to wait system
'fast track' projects to for the heavy hand of
happen stage gate and other major
project management
systems. May even cost
more than the innovation
idea will create. People get
turned off because the wait
is too long or the process is
seen as too bureaucratic

38 We work well in teams Conflicts and failure to get Team building and
the whole to be greater appropriate project
than the sum of the parts management
leads to delays, cost structures
overruns, sub optimal
technical solutions etc,

39 We work closely with 'lead Missing out on key user Use lead user methods
users' to develop innovative perspectives and in find them, engage
new products and services particular the shaping and them, deploy them in
development which lead co-creation but also in
users with tolerance for diffusion
failure can bring. Co-
creation means they have
buy-in and ownership and
become not only good test
beds abut also powerful
advocates

40 We use measurement to Operating an informal or Regular review of how
help identify where and sub-optimal innovation the innovation process
when we can improve our process missing the is working. Deploy
innovation management chance to enhance innovation audit
performance. Attempts to approaches surveys,
improve are poorly interviews, etc. Link
targeted so the momentum to explicit models and
falls away and there may frameworks
be little apparent benefit