Peter Drucker believed that each organization needs one core competence: innovation. The approach is to develop a way to record and appraise its innovative performance.
Most people would probably start by looking at the organization’s own performance, but that might not be sufficient.
It needs to be a careful assessment of the innovations in the entire field during a given period.
Drucker suggested some probing questions to ask:
Which of them were truly successful?
How many of them were ours?
Is our performance commensurate with our objectives? With the direction of the market? With our market standing? With our research spending?
Are our successful innovations in the areas of greatest growth and opportunity?
How many of the truly important innovation opportunities did we miss? Why? Because we did not see them? Or because we saw them but dismissed them? Or because we botched them?
How well do we do in converting an innovation into a commercial product?
Throughout the exercise, it will likely raise more questions rather than answers.
Even more likely, those will be the right questions for the organization to ask over and over again.