The degree of innovation defines how "original" an innovation is. This KPI from idea and innovation management makes it possible to classify an idea by novelty and diffusion speed. The higher the degree of innovation, the greater the disruption potential of your idea.

Many ideas circulate in a typical company. The question of which ones to focus on can be answered with the help of measuring the degree of innovation.

Calculating the degree of innovation

The degree of innovation is primarily important for companies that want to address and create new markets beyond their existing core business. The KPI is calculated as follows:

Novelty of the idea x Diffusion speed of the idea = Degree of innovation

The novelty of the idea can be rated, for example, on a scale of 1 to 10. Scores of 1–5 indicate ideas that are already old for the industry but new for the company. Scores of 6–10 cover ideas that are new to the industry or represent entirely new technologies for the company.

On the diffusion speed scale, we recommend using an equivalent grid of 1 to 10. The word "diffusion" derives from the Latin "diffundere" – "to pour out", "to scatter", "to spread". The estimate of the idea here concerns two factors: the application and the distribution. Is the use case known or unknown to the user? Are the distribution channels already in place for the innovating company or do they have to be newly built? The higher you rate the diffusion speed, the more unfamiliar the terrain in which you are innovating.

Types of innovation

The degree of innovation distinguishes between incremental, semi-radical and disruptive innovations.

Classifying the degree of innovation:

• Incremental innovations are further developments and optimizations of existing products or services. This type of innovation is very important for a company’s competitiveness. They are usually relatively easy to implement, since they can be carried out on existing systems and processes. The analysis of customer insights or customer surveys is a valuable source of incremental innovation.
• Semi-radical innovations significantly change companies or processes. They are often driven by ideas for entirely new solutions to customer problems, new organizational forms or technological breakthroughs.
• Disruptive innovations can completely replace established business models or technologies. They are very rare, but for that reason all the more "superlative".

Increase the degree of innovation of ideas by systematically frontloading methods such as scenario development or innovation fields. They serve as guardrails in the idea phase and ensure from the outset that ideas are developed only in the truly value-creating areas.

Conclusion: Measuring the degree of innovation

Determining the degree of innovation of your idea is an important basis for decision-making for your innovation project, because the higher the degree of innovation, the greater the uncertainties for the innovating company. As the degree of innovation rises, so do the time and resources required, and at the same time the risk of failure grows. Companies should therefore carefully consider which idea they actually pursue all the way to a market-ready innovation.

With systematic trend management and the creation of innovation fields, the Fuzzy Front End of Innovation shows you not only the opportunities and possibility spaces for your business area. It also provides the decision-making basis you need to execute your innovation projects. From the openness and flexibility – the "fuzziness" – of a constantly shifting trend landscape, you ultimately derive a clear focus for your innovation strategy that pays off in business terms.

Whitepaper: Innovation Is Measurable

The TRENDONE whitepaper "Innovation Is Measurable" reveals the 10 most important KPIs in trend and innovation management.

Innovation KPIs help you assess your success, serve as a strong communication tool, and underline the importance of trends and innovation within your company.