This week the Wall Street Journal released its Management Top 250, based on the Drucker Institute's company rankings. These rankings also lean on Drucker to define the essence of innovation at the core of this ranking system: "innovation [endows] human and material resources with new and greater wealth-producing capacity." In short, as the introductory article aptly noted, "Novelty is a side effect of innovation, not its essence."
Measuring innovation is often relegated to soft measures or what could be defined as "novelty." These metrics might include patents--an arena often dominated by IBM but having limited impact on stock price--or an array of corporate and/or marketing initiatives meant to elevate the brand. Commendably, these rankings avoid the squishy novelties and PR initiatives. Instead the Management Top 250 relies on four principles derivative of Drucker's work that best capture how innovation should be measured, and that is the extent to which they:
-
introduce new systems for continuous improvement
-
leverage the success of their innovation
-
toss what stops generating value
-
replace successful products/services and consequently, redefine the future.
In reviewing the introduction to the rankings, I was most struck by its decision to use consumer perception of innovation as a measure of innovation. The writer justified this decision by noting, "...because no innovation metric can be complete without the voices of the ultimate judges...." I completely agree and salute the Management Top 250 rankings and the Drucker Institute for making this call. Kaptivate firmly believes that public engagement lies at the heart of innovation. For any enterprise to center is strategy on innovation, it needs to invite its stakeholders to be a part of this value-creating exercise. Practically, that means building awareness of your initiatives, engaging communities of experts and your customers in crowdsourcing solutions for improvement, and inviting your stakeholders to provide ongoing feedback on how you're doing.
We're witnessing more private and public sector enterprises rallying to this intersection of innovation and public engagement. And we're glad to see it. This movement towards inviting the public in, and cultivating communities that can support enterprise innovation, is the essence of what we mean by Pivot + Thrive. We're looking forward to a 2022 when this movement builds momentum and replaces novelty with measurable value.
