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Additional Innovation Metrics / Accounting

To increase the rewards from innovation, structure tasks into “ Layers “ and identify what needs to be measured –

                Layer       What is Measured
Strategic InnovationMeasuring outcomes and the innovation ecosystem
Managing Innovation ProcessesMeasuring the innovation funnel
Innovation CompetenciesMeasuring the innovation team(s)
Culture, Leadership, MindsetMeasuring culture, skills and capabilities

…where each layer is measured by the following criteria –

Measuring the Innovation Ecosystem

  1. Revenue
  2. Portfolio distribution
  3. Investment distribution
  4. New product vitality index
  5. Portfolio fade
  6. Efficiency of innovation investment
  7. Cost of innovation
  8. New-to-existing profitability index
  9. Innovation profitability ratio
  10. Average funnel conversion rate
  11. Average time to sustain

Measuring the Innovation Funnel

  1. Number of ideas in stage
  2. Number of ideas stopped per stage
  3. Number of ideas progressed per stage
  4. Average cost indicators
  5. Average time spent per stage
  6. Average estimated value-to-cost ratio

Measuring the Innovation Team(s)

  1. Learning velocity
  2. Maturity specific indicators
  3. Confidence of key success factors
  4. Holistic confidence in venture
  5. Cost of the venture
  6. Time spent in stage
  7. Value-to-cost ratio
  8. Risk-adjusted value-to-cost ratio

Measuring Culture, Capabilities, and Mindset

  1. Culture traits measures
  2. HR capability traits measures
  3. Open minded, exploring, willingness to try, etc.
  4. Entrepreneurial, collaborative environment
  5. Rewards for successes and learnings

Next Step  –  To Increase the rewards from innovation :

  1. Gain additional insights on innovation in other articles at and other sources
  2. Get the Innovation Accounting book to learn more about each measure, including practical tools and advice on how to create your own innovation accounting system
  3. Contact CAIL at to discuss innovation metrics, opportunities, developing the mindset to innovate for impact, strategies to meaningfully improve outcomes from innovation, etc.

Nov 2, 2021   –  by Bruno Pesec / CAIL           Innovation Insights                   905-940-9000