Strategic and tactical innovation management

Different layers of the organisation have different tasks when it comes to innovation.

Executives worry about funding, returns, and strategy. Managers focus on orchestration, matchmaking, and collaboration. Front line generates, tests, and develops ideas.

Each layer requires different tools and measures to efficiently manage their work.

At the executive layer we ought to be measuring portfolio of all innovation investments, keeping track of portfolio distribution, new product vitality index, efficiency of innovation investment, innovation profitability ratio, and similar.

At the managerial layer we should be focused on measuring the innovation funnel, looking at aggregate metrics such as number of ideas per stage, average cost indicators, average time spent per stage, average estimated value-to-cost ratio, and similar.

At the operational layer we have dual set of measures, one of the idea itself and one for the team so we know we are on the right track. Risk-adjusted value-to-cost ratio and AARRR are good example for the former, while learning velocity and time spent are fine examples of the latter.

A healthy innovation ecosystem will tend to all of the above, allowing everyone to meaningfully contribute to organsiation's innovation efforts.