How do you know that the improvement goals you’re setting for your organisation are realistic & sustainable?
As business leaders, we are incredibly focused on driving ambitious growth as fast as possible, but moving too quickly in capability-building often backfires and can slow innovation, frustrate teams, and erode trust. Just as every marathon runner needed to start with a 5km, your business may need to target smaller wins first.
New product development processes are often formalised only once an organisation has steady day-to-day operations and a wide range of offerings. This means that incumbent product development is ad-hoc, siloed, and often bespoke to the specific department or team that developed it. At the point of consolidating and looking to mature these processes, it is easy to overload the team with advanced tools, metrics, and governance that creates more problems than it solves.
Too much too quickly creates several parallel risks in your organisation:
A lack of experience & deep understanding in numerous new tools will likely lead to all tools be used poorly.
Too many metrics dilutes focus, and actionable insights get buried in a sea of unhelpful information
The process can become bureaucratic and stifling, rather than enabling
Teams will resist practices that they can’t operationalise
Improvement targets should exist as a roadmap, rather than trying to achieve the idealised future state all at once. A good understanding of your innovation process maturity helps to build a foundation for which improvements are realistic for your organisation’s immediate future. For example:
From Initial (Ad-hoc) to Managed (Repeatable): Here, your focus should be on simplicity & adoption. Guide your teams to formalise their development activities, draft learnings for each process step and apply those to future projects and keep a handful of outcome-oriented metrics like Product Development Cycle Time, Overall Product Development Costs, and Product Success Rates.
From Managed to Defined (Standardised): Your organisation will have some change-resistance as you attempt to move different departments from fragmented innovation activities into a central, standardised approach. However, as you move to work in the same manner, management becomes simpler, and measurement can become slightly more complex. Introduce measures that monitor process adherence such as Assumptions per Stage, Learning Efficiency, Confidence in Stage-Specific
From Standardised to Quantitatively Managed (Predictable): At this point, you have enough repeatability to introduce internal benchmarking to monitor your existing portfolio against the performance of previous efforts. Here, you start to introduce efficiency measures such as Stage-Specific Times & Costs, Resource Utilisation Rates, Portfolio Balance, and Funnel Conversion Rates (i.e. % of ideas that reach final product launch)
From Quantitatively Managed to Optimised: From here, you are looking to extract the optimal benefits from your otherwise consistent, high-quality, and beneficial process. At this point, you introduce advanced concepts & metrics such as multi-dimensional confidence rubrics, experiment selection & design optimisation, innovation profitability ratio, new product viability index and key capability utilisation.
Whilst it is valuable to hold an idealised state of business in your mind, understanding your current NPD maturity is key to setting realistic improvement goals for your organisation. By gradually building discipline in your process, you will equip your teams to grow naturally. You do not necessarily need a formal evaluation to get started though. Map out your existing NPD process, with inputs from a variety of innovation team members. Compare the complexity of the process to that of the metrics and compare both to the degree of success achieved. This will help you understand your starting point, and what’s realistic to target next.
For a comprehensive look at how to design & curate innovation metrics that match your own level of progress, join us for the upcoming Innovation Measurement Workshop, where we dive into detail on development frameworks, multi-layered metrics, and best practices for innovation.
