Is an "Innovation Index" even possible?
Mark Adkins at the Product Development & Management Association (PDMA) recently suggested creating an "innovation index" to catalog innovation stories and provide a benchmarking tool. The model it would be based on is the Purchasing Managers’ Index (PMI), which has been around some 60 years.
From the PDMI blog:
Let me propose that PDMA spearhead the design and launch of the Product & Service Index (PSI IndexTM) along the same lines as the PMI. In it we would survey a number of companies on a monthly basis, but rather than asking questions on production levels or new orders, we would probe the following five areas:
• Number of new projects initiated
• Number of active projects
• Number of projects terminated or halted
• Number of people employed on NPD teams
• Number of new product or services launched
The project could prove worthwhile, provided companies buy in - and they get the right people involved. Cutting-edge businesses know that true innovation is not the sole responsibility of R&D - it requires a culture change, and can include every level and department in an organization.
The PMI reports on data from a 40,000-member network of professionals engaged in the supply management and purchasing fields. It appears the PDMI plans to limit its report's scope to new product innovation, though that is a small element of what an enterprise innovation system can do for a business. It might be useful to broaden it out, but problems arise: How do you keep people accountable, especially if a business wants to keep its "smarts" secret to maintain competitive advantage/market share?
The index could be a good tool, provided the reporting's solid. But would such a tool be useful to companies who are using an innovation platform for more than new product development? Would they require a different reporting mechanism to benchmark themselves, and could such a tool exist?