The good folks at Goldense Group have concluded their biannual survey on Innovation Practices again. Here are some of the first results:

GGI Market Research Survey Questionnaire Benchmarking Productivity Performance Trends for Industrial High-Tech Software Companies

First, a word about the participants:

Research Participants:  About two-thirds of respondents were from public companies, about one-third were from private companies.  Over fifty percent had a title of Director or greater, less than 20% held a title of Manager or lower.  Over eighty-five percent of respondents were from R&D-Product Development and/or Senior Management.  About half of respondents were from companies with sales less than $.5B, forty percent were from $.5B to $5B, and twelve percent were greater than $5B.  All industries were represented, including a number of software-only companies.

Now the meat: what kind of innovation strategies do the respondents pursue: Surprise!

Only 5% of companies follow an "innovator" R&D strategy, the rest of companies follow more risk-averse strategies.  "Platform-Derivative" strategies have been growing for the past thirty years and are now practiced about equally to  "Balanced Portfolio" strategies.  The rest pursue "Follower-Extender" strategies.  Regardless of strategy, management's emphasis on innovation will be greater in the coming five years than it has been in the past.  Management will primarily achieve this emphasis through increased financial investment in physical assets when compared to financial investment in people, processes, and practices.

Platform and Follower/Extender strategies are the most prevalent. Only 5% of the respondents follow a true "innovator" strategy... Hmm, should that be the cause for the profitability distribution, which also runs around 5% of top companies?

Research Conclusions:  It seems that management has a different perception about approaching Innovation than the recent Lean, Six Sigma, and Agile initiatives of the past decade where there was primarily an emphasis on training people and using processes, and practices.  The tangibleness of innovation remains elusive.

Thinking about our own efforts (outlined in "The Elephant in the Lab", it is small wonder that most companies do not have good metrics to define and measure innovation. "Quality" is so much easier to tackle!