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# How to measure innovation performance
- URL: https://www.pesec.no/how-to-measure-innovation-performance/
- Published: 2021-03-15T08:00:00.000Z
- Updated: 2021-03-15T07:59:59.000Z
- Description: Two types of measures you need to track.
- Author: Bruno Pešec
- Tags: Innovation, Metrics, #Innovation Management, #Innovation Accounting

The key to measuring innovation performance is understanding the difference between [*doing* and *managing* innovation](https://www.pesec.no/doing-and-managing-innovation/):

- Doing innovation is about transforming ideas into businesses.
- Managing innovation is about creating clear directions and making investment decisions.

A common complaint I hear is that since each innovation project is unique it's impossible to measure them consistently.

That's only true if you [set-up innovation projects](https://www.pesec.no/structuring-innovation-projects/) with fuzzy objectives. If it's clear what they are working towards, then you have a clear thing to measure.

*"But their goal is to generate X revenue, and that won't happen until the third year!"*

Good, then work out what would be the leading indicators for that. What would be good measures of a positive market response?

And while you are working on that, make sure to also track how fast are you generating [validated learning](https://www.pesec.no/creating-reusable-knowledge-how-to-design-effective-experiments/).

In order to measure how well you manage innovation you need to answer:

- How many ideas are we investing in?
- How are they distributed according to their type and maturity?
- How much are we spending on them?
- How much are we benefiting from them?
- How do they contribute to the overall strategy?
- At what rate are the teams learning?

When deciding on what to measure I suggest going for the simplest you can. 

After all, you want to measure these in order to make a better decision, not to wow someone with your intricate dashboard.

For more detailed instructions on creating your innovation metrics I suggest:

[A proven system for measuring innovationInnovation accounting book is now available for pre-order.![](https://www.pesec.no/favicon.png)Bruno PešecBruno Pešec![](https://storage.ghost.io/c/72/d5/72d522ba-f2e5-4415-a19c-d8f567c36347/content/images/2020/11/stacked-cover-Innovation-Accounting-1024x585.png)](https://www.pesec.no/innovation-accounting-book/)

[How to design a metric that mattersMeasuring the right things helps us make better decisions.![](https://www.pesec.no/favicon.png)Bruno PešecBruno Pešec![](https://storage.ghost.io/c/72/d5/72d522ba-f2e5-4415-a19c-d8f567c36347/content/images/2021/01/How-to-design-a-metric-that-matters.png)](https://www.pesec.no/how-to-design-a-metric-that-matters/)

[Are you measuring it to feel good or to do better?No room for vanity in business.![](https://www.pesec.no/favicon.png)Bruno PešecBruno Pešec![](https://storage.ghost.io/c/72/d5/72d522ba-f2e5-4415-a19c-d8f567c36347/content/images/2021/01/Are-you-measuring-it-to-feel-good-or-to-do-better.png)](https://www.pesec.no/are-you-measuring-it-to-feel-good-or-to-do-better/)