Measuring the impact of any business innovation has split companies. But now two metrics have been discovered, which when combined can give the perfect indication of this effect. These metrics have traditionally focused only on Research and Development (R & D). In reality, the quality of research can only be backed up by reasonable adoption levels by the organization. Companies do not easily publish their data on the business research and development conducted by them, so it is often difficult to deduce the actual impact. The first of these two metrics is the percentage conversion of this R & D to new product development. The other is the product to margin conversion. It is beneficial to categorize the innovations as per portfolios, as it will be easier to extract insights individually for projects. These metrics however must account for the usual innovation cycle, so quick failures need not be consigned to the bin.

Source:https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/how-to-take-the-measure-of-innovation

Uploaded Date:12 June 2019