Beruflich Dokumente
Kultur Dokumente
Benchmarking Innovation:
A Short Report
Zoe Radnor and Judith Robinson
A project is reported that benchmarked `best practice' mature organisations, with a base in
the United Kingdom, on the processes and practices that they perceive underpinned
successful innovation projects. The majority of organisations had director level personnel
involved in the innovation process but only three had active involvement of the top
management. However, the majority saw the greatest level of innovation being obtained
through the use of cross-functional teams. Five key innovation supports were identified
during the benchmarking exercise. These were top management support for, and involve-
ment in the process; the appointment of an innovation champion or sponsor; rewards for
innovative behaviours and ideas; and finally a positive attitude to building on creative ideas,
irrespective of their source. It is suggested that benchmarking can play a role in identifying
best-practice innovation structures and procedures.
# Blackwell Publishers Ltd 2000. 108 Cowley Road, Oxford OX4 1JF
and 350 Main St, Malden, MA 02148, USA. Volume 9 Number 1 March 2000
4 CREATIVITY AND INNOVATION MANAGEMENT
Thus, although these stage models have searches and the use of appropriate databases
high face-validity, Rickards (1996) points out (Mintel, Extel cards, and The creative organ-
that the innovating system remains open to isation database, Rickards 1998). The inten-
information throughout. Ideas, generally of a tion was to gather data and identify potential
more incremental kind, may be regarded as benchmarking partners. A systematic search
thoroughly inter-mingled with implementa- for information was undertaken on compa-
tion activities. Furthermore, the cyclic rep- nies based in both the FTSE Top 100 and Dow
resentation of the models indicates that Jones Top 100.
implementation is always `sandwiched' be-
tween planning-type stages. In other words, Criteria for Admission Included
we must treat stage models as useful guides
to a more complex reality that is always open Large organisations with turnover similar to,
to contextual surprises. This is why bench- or greater than that of the sponsoring organi-
marking can suggest possibilities, but cannot sations' Business Units. Separate innovation
provide a total a priori plan for a specific units associated with large organisations were
future innovation. (Mintzberg 1994). also included, provided their parent organi-
sation matched both the turnover require-
ment and operated within the science-based
Methods or FMCG areas.
research objective was to gain an understand- ward-looking focus for innovation process.
ing of the innovation process and the organ- Furthermore, it demonstrates the importance
isational design features that maximise step- of creating a culture which fosters and
change innovation. The sample were drawn encourages excellent intra company com-
from a diverse range of industries and sectors munication to share knowledge.
as the researchers recognise that best practice The information gleaned from each set of
can be shared across industry boundaries benchmark interviews has been summarised
provided the context is understood. into a series of key features associated with
The results of the survey are discussed in the following topics: people; processes and
the following sections. It should be noted that organisational culture. In this report, the
the exercise was to study `best-practice' following definitions were used.
companies. However, benchmarking is a con- People (see Table 3) essentially summarised
tinual improvement process and as such, who are the key players within the innovation
`best-practice' is an elusive goal. As a con- process. It links into the human side of the
sequence, companies were selected as they innovation process. This includes the role
were recognised as offering good practice in of top management; and the nature of the
certain areas aligned to innovation. Further- leaders of the innovation programme on a
more, companies were selected so that a range day-to-day basis, from where ideas are
of both good practice, and business environ- sourced.
ments, were surveyed to enable learning from Process (see Table 4) is linked to the under-
diverse practices. Table 2 summarises the lying operational aspects which help the
main reasons why each company was organisation develop innovations.
selected for inclusion in this study. Culture (see Table 5) indicates the types of
The use of a mixed qualitative and quan- tools that the organisations have used to
titative interview approach has enabled an embed positive behaviours such as idea
understanding to be developed, of the context sharing, entrepreneurial attitudes and a posi-
in which each organisation operates. For tive attitude to innovation and associated
example, when asked about their definitions cross-functional working within the organis-
of innovation, most noted that innovation was ation. By using two-dimensional tables or
customer focussed (data not shown), the matrices, the direct analysis and comparison
exception being Biotechco who indicated that of organisations becomes possible.
innovation was technological. Innovation is associated with flows of
Clearly, there is wide agreement that any information across organisational boundaries
innovation process has to have a customer- as it is in effect a boundary spanning process. Customer-focussed
focussed approach. A member of the Retailco Table 3 attempts to summarise how the approach
Board noted that `All organisations, and organisations encourage innovative activity
parts of organisations could be described as through the use of human resource. Five key
retailers ± some just don't realise it! Every one features were identified during the bench-
has a customer be it internal or external'. This marking exercise. These included top man-
again reinforces the importance of an out- agement support for, and involvement in the
Clear agenda for Yes Somewhat Yes Yes Yes Yes No Yes
innovation
Hierarchical Yes Yes Yes No No Yes Yes Yes
organisation
Entrepreneurial Yes No No Yes Yes Yes Yes No
culture
Innovation rewards Yes Yes Part of Yes ? Yes Yes ?
appraisal
scheme
What types of Token Bonuses ? Yes Company Options Shares ?
reward? reward Meals out grows Consultant
Leave contracts
Functional silos Yes Yes Yes No No Some No Yes
progress monitoring across functional bound- quotations from each of the partner com-
aries. panies about their organisations' attitudes
When considering innovation, it is difficult towards innovation, provide some support
to avoid an examination of the organisational for issues highlighted in the previous tables
culture (Table 5). A number of representative (see Table 6).
Table 6. Representative Comments from Each Organisation and Its Innovation Procedures
Retailco ``The involvement of top management is responsible for the success of our
process''
``Our suggestion scheme generates 1000 ideas a month''
``Since instigating our innovation process we have increased our project
pipeline and cut our budget by a factor of four''
``A two tier structure enables us to work on risky and less risky projects''
``Everyone can be involved in innovation''
Pharmaco ``We want to be recognised for innovation and leadership in the therapeutic
areas in which we compete.''
``We have established ourselves as a group of internal consultants ± that's truly
innovative for a bunch of statisticians. We can, however, utilise our statistical
expertise to help other parts of the business examine their processes and we can
suggest changes which may make substantial cost savings. Statistics is all about
processes''
``our discovery process is probably very similar to that of other pharma
companies, but we also encourage innovation in other areas, working, process
modifications and to our culture''
Healthco ``each business has an innovation champion, but they may be at different
levels''
``category managers have innovation as part of their appraisal procedure''
``we are hugely advantaged by having access to in-house manufacturing in
terms of R&D costs and development time''
``. . . tend to over analyse leading to both a slow response to competitors and to a
protracted decision making process''
Familyco ``there is a formal process for new product development, matching a flavour
etc, other innovations are processed more informally through the business units
to the M.D.''
Computaco ``we have no process for innovation ± it's against our culture''
``[we are] a metrics driven organisation''
``we have a very flat organisational structure, and are very entrepreneurial''
Uniresorg ``The Academic brings their idea to us we then help in the process of
commercialisation''
``The metrics used for benchmarking research vary depending on the
organisation''
Biotechco ``Research scientists and group leaders must be both creative, and innovative in
order to be successful in their research programmes''
``Researchers have changed ± they are becoming more commercially aware''
``we try to recognise everyone when arranging rewards for commercialisation-
not just those named on the patent ± this is important''
Consumerco ``we use a stage gate system for innovation''
``innovation is about adapting existing products to new markets''
``our cross-cultural and functional teams are a key part of our success''
this analysis it could be concluded that the of innovation being obtained through the
benchmark partners reported that they were use of cross-functional teams.
most concerned to develop strong relation-
All but one company felt the culture of the
ships with their customers often voiced in
organisation reflected a clear agenda for
terms of `relationship marketing' and cus-
innovation. Six companies stated they had a
tomer service.
hierarchical organisation, and five stated they
Finally, within the benchmarking literature
had an entrepreneurial company ± some
there is a substantial body of data relating to
stating they had both.
the use of specific performance measures when
A variety of rewards were given for
documenting innovation. As such it was of
innovation, such as tokens, bonuses, meals
interest to collect some data relating to the
out, and special options.
performance measures reported to be applied
The process for innovation varied across all
within the organisations (Table 9). These data
the benchmark partners. Half of them em-
indicate that each organisation appears to select
phasising the internal processes, and the
those measures that are most appropriate to
others not. However, the majority had a
their organisation, with the results being
process for sharing ideas and used the stage
spread across a wide range of measures.
gate model as a tool for monitoring the actual
process. The use of IT varied amongst the
companies, as did the gatekeepers for the
Discussion stages of innovation. Finally just over half had
a dedicated resource for the innovation, with
This paper has sketched out the findings from
variations in financial appraisal methods
our recent work into benchmarking innova-
deployed.
tion amongst eight organisations. The results
These findings, together with some of the
were presented in terms of three main tables,
qualitative data and the other tables pre-
based on people, culture and process. These
sented can highlight some key issues in
People, culture and
can be summarised as: process
relation to innovation. These key issues, and
The majority of organisations had director questions that can be raised include:
level personnel involved in the innovation
process but only three had active top (1) It is possible to benchmark the innovation
involvement of the management. How- process, provided a clear understanding
ever, the majority saw the greatest level of the organisational context is developed?
(2) Can entrepreneurial activities survive UK. It has been argued that successful inno-
within a hierarchical structure? vation is central to the development of future
competitive strategies of organisations (for
Innovation is complex and multi-dimen- example, see Porter 1985). Critical success
sional in its approach, and therefore contex- factors such as quality, delivery, flexibility and
tual issues will always have to be taken into cost are integral parts which an organisation
account for any innovation requires to operate to survive. In addition,
Lack of resource availability is generally successful innovation may become the factor
regarded as a major block to the innovation that allows the company to grow. By bench-
process marking the practices and processes of inno-
A wide range of performance measures are vation with other organisations, companies may
reported as being used amongst the reporting be able not only ` to adapt' but also `advance'
organisations ± further analysis needs to take in an ever-more competitive marketplace.
place into which are the strategic and value-
added metrics relevant to the success of an
innovation process.
Innovation aims to meet customer require-
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