Innovation measurement in a strategy context -How to increase innovativeness through measurement

Issue of study Recent innovation measurement literature recognizes the need for uniqueness and suitability in a company’s innovation activities. Previous contributions construct a measurement framework with examples of metrics for the intended company to choose from. But recommendations are sparse on how to select which to use and how they will affect the organization. It is here a gap is identified in the current literature; no real attempts have been made to relate innovation measurement against innovation strategy. The importance of linking strategy and performance measurement has been stressed by many authors and it can be said to be an agreement that the internal innovation process should look differently depending on what type of innovation that is intended i.e. incremental or radical. With this in mind, it follows by logic that measurement should be fitted to the intended innovation outcome accordingly. The aim with a mapping like this is not to create predefined sets of metrics for practitioners to choose from, but rather to outline guidelines for how to select metrics contingent on innovation strategy. Purpose The purpose of the thesis is to outline guidelines for how to work with innovation measurement contingent on innovation strategy. Methodology First, a literature review was conducted to gain insight into the theoretical areas of innovation, innovation strategy and performance measurement. This was followed by semi- structured interviews with representatives from four case study companies, to understand the hurdles they were facing with innovation measurement. Further interviews were conducted with experts with experience of innovation measurement, which was used as a condensed complement to the theoretical areas studied. The knowledge gained through theory and interviews were then synthesized into a set of guidelines, a framework and a tool, all which are intended to aid practitioners in their innovation measurement effort. Conclusion The biggest hurdle for measuring innovation identified through the study, was that the inherent complexity of the innovation process leads to uncertainty of what and how to measure. Practitioners struggle when trying to implement an all-inclusive measurement system, which leads to the attempts being futile. It is argued that a better approach is to start small and focus on adding attention to the weakest part of the innovation process by using only a small set of metrics related to that area. This approach is not a way to monitor the innovativeness of an organization but aims to strengthen its innovation process from the core.