Assessing Innovation's ROI

A recent article in the McKinsey Quarterly reports:

    The companies that get the highest returns from innovation do use metrics     well; these organizations tend to assess innovation more comprehensively     than the others.

Makes me think assessing innovation's ROI is as challenging as assessing the ROI for social media. I see the common challenge for measuring both is their results can often be dispersed, manifested initially in small changes reflected in minor metrics.

As they gain momentum...the impact (we assume it's positive) becomes self-sustaining.  There's positive momentum generated from quantifiable metrics and less-quantifiable metrics in the area of intrinsic motivations. the quantifiable metrics satisfy the quants in the organization and insure an uninterrupted flow of resources: time and money and materials. The less-quantifiable metrics with motivations are critical. That's what determines buy-in or engagement from the employees responsible for implementing and leading the change processes with and/or from either social media or innovation.

What's interesting is this tidbit:

    Forty-five percent don’t track the relationship between spending on             innovation and shareholder value.

To that, I just say...huh? What's important gets measured. What's not, doesn't. So...you're investing resources with no idea of its impact on shareholder (or stakeholder) value? What are you doing, then? Why? Do you think this lack of connection with any goal...goes unnoticed by everyone in the company?

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