Participation Leads to Innovation

Spigit is a leading innovation management software company.  They recently published a research paper entitled ‘Quantifying a Culture of Innovation.’  Northwestern University’s Kellogg School of Management carried out a study of data from 154 corporate customers of Spigit over a five year period.  The findings are instructive.  They report a significant correlation between ideation rates (generating good ideas) and profit growth.  They found that four factors were particularly important for success with innovation and growth.

1. Scale of activity – the more people who participated and the more ideas the better.

2. Frequency – the more brainstorm and ideation events the better.

3. Engagement – the more active participation by people the better.

4. Diversity – the more diverse the participants in terms of roles and departments the better.

They use a metric called Ideation Rate which they define as the ration of winning ideas to active participants.  A winning idea is an idea submitted for a specific challenge which is voted upon by colleagues and rated as promising by evaluators.  The study found a significant correlation between Ideation Rate and profit growth.  They give a good Ideation Rate as 500 ideas per 1000 users per year.

They measured engagement by the level of peer voting on ideas – on average this is about 5 votes per user per year.  In the top 10 most successful companies there were 10 votes per user.

Another finding was that higher concentration of ideas – from a small active group – was much less effective than broad participation from diverse fields.

They found that focusing on process or product innovation or between sustaining and disruptive innovation made little difference.  The most important factor was that the more people who actively participate the more valuable the ideas that emerge.

The paper is 14 pages long and contains brief case studies from AT&T, United Health Group, Pfizer and EDF Energy.

Quantifying a Culture of Innovation.

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This post was previously published on Destination Innovation.

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