Measuring Innovation, Part 2/3: The Criteria for a Good Innovation Index

This article discusses the criteria for a new and effective innovation index that allows for measuring innovation performance. A good innovation metric should be comprehensive, feasible, actionable, timely, comparative, and allow setting targets. The index should allow users to measure current innovation performance with prior years’ performance, as well as with competitors’ performance. The ability to compare innovation performance with competitors will support increasing a company’s competitiveness, market share, revenue, and profitability. Additionally, a metric that allows setting targets and setting clear measurable and quantifiable goals supports company improvement. This article also highlights the importance of a metric that is both feasible and practical to measure, comprehensible, and balanced between revenue-generating and pipeline innovation.