Understanding how to measure innovation is important in order to improve as an innovator. The value of innovation can be assessed through four types of value including: knowledge, recognition, economic value, and social value. Knowledge refers to acquired facts and skills, and can be measured through indicators such as scientific papers and patents. Recognition, the diffusion and visibility of an idea, can be measured using tools like social media interactions. Economic value is measured through indicators like sales and revenue. Lastly, there is a growing focus on social value, which considers the number of people benefiting from an idea's implementation, including its impact on the planet. The challenge is in measuring innovation beyond economic factors, knowledge, and recognition, and prioritizing conscious policies that benefit society and the environment.
To understand how to improve as an innovator or an innovation, we must learn how to measure and capture value.
After reviewing the beliefs of some of the most significant authors of our time, I have determined four types of value and ways in which it can be calculated as follows :
First, The value of knowledge. All facts, information, and skills acquired by a person or entity through experience or education and the sum of what they know is understood as knowledge. By measuring their know-how, we can demonstrate the value of innovation.
KPIs could be the number of scientific papers, review articles, and patents, among others. These are distributed by universities, research centers, laboratories, or companies, so knowledge is a value we can measure and capture.
Innovation is also about the diffusion of an idea and how recognizable it is to the public.
In the past, recognition was measured by conducting market studies. However, over time and through new technological developments, we have gained access to many tools that allow us to measure the impact of a person, idea, or product.
For example, it can be measured by the number of "likes" on a social network, the number of followers, the number of visit interactions, and so on!
We also need to be aware of the difference between fame and prestige. While the first one means how everyone recognizes someone or something, prestige is measured by being identified only by those who you care about
KPI’s can be established not just as likes or followers but as the relevance of local or international prizes, certificates, and distinctions, such as the Nobel Prize, the Pulitzer, or the Oscar.
Most of the literature on innovation refers to capturing economic value; after all, today's definition has been framed by developing ideas into the market, and innovations are often measured by the economic impact and how deeply the idea reaches into the market.
Innovation not only thrives through capital investment, but in most cases is framed by it; some KPIs to measure innovation would be shares, financial statements, sales, and revenue.
Finally, more and more we are focusing on innovations that benefit people and the planet. So the most important value to be captured is the social one!
Social value is understood as the number of people who can benefit from implementing an idea, including the planet, so now we can start to talk about social value and environmental innovation, among others.
The challenge of innovating today is to capture more than just economic value, knowledge, or recognition. It is imperative that we manage conscious politics to benefit human people and the planet, for we need to guarantee that we can implement ideas that improve our chances to coexist on the earth sustainably.
Ultimately, the sum of all these types of values, and how they impact each other, determines the degree to which an institution or person could be considered less or more innovative.