Tracking Innovation Progress

A guide to Adaptive Innovation: Part 3 of 3

In the previous part, we introduced an approach to systematically define innovation objectives and then laid out how to generate innovation models for them.

Now it’s time to put everything together and give innovators a practical day-to-day tool to document all their efforts throughout the entire innovation journey.

We encourage innovators to maintain an innovation journal for:

• actively illustrating the flow of information that drives the validation process, maximizing transparency with regard to assumptions and insights;

• providing a source for retrospective analysis, making it easy to spot possible blind spots of past validation efforts and avoiding unwanted biases in the future;

• documenting the innovation journey for new joiners and other colleagues to provide a quick understanding of how an organization arrived at its current level of understanding.

The Innovation Model in Practice

Validating Assumptions

At its core, this canvas is driven by assumptions moving from the strategy level through the priority level downwards to the activity level. Likewise, insights move up from the activity level through the priority level to the strategy level. When innovators sketch out this flow of information and add communication activities to it, they simultaneously describe a communication model.

Ideally, every cycle starts by creating full transparency about everything that goes into the creation of strategy and priority. What is the train of thought that leads to a given strategy? What is the narrative behind a priority? How are they based on prior validation uncovered during an activity?

The left-hand side of the cycle is centered around assumption generation and exploration while the right-hand side is connected to activities for describing and processing insights generated during that exploration.

Communicating Insights

Further, this canvas is supposed to provide visibility about all contributing tools, linking to raw results. By describing how the validation process generates insights, trust around conclusions is built with all recipients, giving them an opportunity to challenge and revalidate them.

The innovation model and the innovation journal both highlight why it matters that two kinds of people should be in regular conversation with each other: those with deep insights about how things materialize in reality and those who can explain the reasoning behind strategy and priority.

This conversation can only be fruitful with a solid understanding of relevant assumptions on one side and the appreciation of insights on the other side. Moreover, critical insights are regularly generated without anyone looking for them. It’s crucial that those who have these insights at hand through their role, understand when and how to communicate them.

Learning Systematically

Structuring the validation process along assumptions and insights is the foundation of learning systematically. When the input behind strategies and priorities are framed as assumptions, everyone down the line is invited to challenge them. More specifically:

Strategy needs to make assumptions about both the presence and the future of an innovation environment, in order to explain how it will overcome the challenges ahead. In a product company, these challenges are often framed as problems and desires and the general approach to address them is usually connected to distinct competitive advantages. These assumptions must be made explicit, or otherwise new insights cannot systematically correct strategy when reality unfolds in other ways than assumed.

Priorities will be based on assumptions about invested resources and expected results of activities. And just like at the strategy level, every new insight is relevant to prioritization when it corrects an assumption that the prioritization was based on. At the same time, one common principle applies to all methods of prioritization: priorities should remain stable until the point an organization either achieves an objective or learns something new and relevant that suggests reprioritization.

Activities and everyone involved in operational roles can only make effective contributions to insight generation when they are aware of the assumptions at the foundation of strategy and priorities. Further, they will only proactively share insights when their contributions are regularly incentivized, valued and acted upon.This conversation can only be fruitful with a solid understanding of relevant assumptions on one side and the appreciation of insights on the other side.

Fostering Validation

Combining this structure for the validation process with concise innovation objectives is what makes innovation processes systematically effective. When the general direction is clear and the methods of validation are appropriate to constantly adjust the path, innovators might still make some detours, but will eventually arrive at their destination.

There will be plenty of factors that determine the speed of that journey, like individual experience, communication structure, and available resources, but as long as validation is applied throughout the process, detours are less frequent, shorter, and less expensive - hence valuable learning experiences. Overall, the innovation journey will feel to be one of growing confidence to generate the desired impact.

With validation generating increasingly concise insights and therefore progress being made towards meeting innovation objectives, the connected innovation model will require modification on a regular basis and we therefore recommend revisiting it after every innovation cycle.

Overcoming Organizational Barriers

Here it also becomes obvious why startups and sheltered innovation teams are so often successfully innovating during the early stages of their existence: as long as a reasonable innovation model is in place, communication in small groups easily keeps everyone in the loop ensuring a constant flow of assumptions to insights.

Despite their naturally lean size, early-stage startups can still benefit from explicitly stating and following an innovation model and maintaining an innovation journal for two reasons:

1. First, they might detect unwanted biases and social dynamics in their current way of working that hold them back from achieving their full potential. Explicitly reflecting on learning and communication helps resolve tensions and supports the appreciation of each other's perspectives.

2. Second, when successful, startups will almost always grow their team and at a point will also benefit from consciously formalizing their innovation models. Otherwise, they will often fall into one of the most prominent traps of rapid growth: expanding while losing the spirit and pace that made the startup a successful innovator in the first place.

However, downsizing teams and providing them with autonomy is not always a viable answer. Large organizations need to exist and innovate as such for various reasons. As long as they find ways to keep their innovation models functioning through healthy communication models, they are equally as able to reliably cultivate innovation success as lean startups.

The previously introduced levels of validation are also going to structure our understanding of systematic learning in the innovation journal. Also, we are going to continue to keep track of how tools & activities contribute to reaching an innovation objective.

We intend for innovators to populate this canvas once per innovation objective, as the validation process and the tools involved are going to be fundamentally different for the substantially different objectives.

Innovation Cycles

In the innovation journal, we structure the steps toward an innovation objective in the form of validation cycles. These cycles represent an organization’s rhythm of validation and information exchange. Cycles can be of variable length and don’t necessarily need to match the rhythm of the established collaboration cadences.

For every validation cycle, innovators need to define a validation goal. This goal should directly relate to the guiding indicator that was defined on the Innovation Model Canvas. Such a goal should target open-ended outcomes as opposed to well-defined outputs. Output metrics are vanity metrics and should be avoided. What we want to encourage is the use of success-related metrics like user satisfaction, engagement, revenue per customer, etc.

Here are a couple of examples of targets for an indicator like “user adoption rate”:

• find a valid quantitative expression of user adoption

• benchmark our adoption rate against top competitors

• understand the top reason for failed user adoption

• identify properties that distinguish adopting users

• test if measure X increases or decreases the adoption rate

Each validation cycle represents a set of validation activities that turn assumptions into insights. The designated space at the bottom provides room for capturing assumptions related to the guiding indicator at the start of a cycle as well as for documenting insights generated during a cycle.

When innovators link the outcomes of these activities (notes, reports, statistics, visualizations, prototypes, etc.), this canvas becomes a semantic description of how tools and activities shape validation over time. Consequently, it documents how innovators arrived at their current understanding and conclusions.

Conclusion

The Innovation Journal rounds up our guide to building effective innovation frameworks with an instrument for communicating, monitoring, and documenting the validation process.

We hope this guide helps innovators with diverse backgrounds to professionalize their innovation journey and look forward to hearing your stories and feedback.