With any digital innovation project, as a chief executive, a board member, or an investor – whatever you’re trialing, whether it’s a new operating model, a new product or new services – you naturally want to see a clear outcome to decide whether to press ahead. But with the pace of today’s technological change, you’ll rarely have the detailed technical knowledge to be able to judge if this is the next big thing, or the next big flop.
In a time of rapid change, you need to be checking in to judge progress more often than simply quarterly or yearly. You need to de-couple innovation evaluation from the annual budgeting cycle and adopt a mentality more like that of agile project management, which has been used so effectively by so many disruptive tech companies to drive their successes.
Rather than focus on arbitrary metrics, based on set targets, timeframes, and projections of profits, businesses instead need to change their focus to understandable outcomes.
If you have clear, outcome-focused milestones, then you’ll be able to make more effective decisions: you can stop a project quickly, help it course-correct, or give it more funding to help it deliver on its promise as quickly as possible.
Some outcomes could be demonstrated in weeks, some in months, some may take over a year. Some outcomes can be measured in hard dollars against the bottom line, some can’t. And every innovation project’s desired outcomes are likely to be different.