How do you effectively measure the impact of innovation on sustainable growth?
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Measuring the impact of innovation is not easy, but it's crucial to tie it to outcomes. When we look at various innovation opportunities, we consider what we're trying to achieve, what our goal is, what our current state is, and what the delta state we're trying to achieve is. This becomes part of our measurement criteria.
In our case, we look at rates of graduations, student retention, and other aspects of student life. We're currently innovating in this area to enhance our students' mental and physical state and ensure they have the right support. We're experimenting with new services and measuring how many students we can give access to these services. It's not always clear how you're going to measure innovation, but it needs to be part of your process, and you'll start seeing positive outcomes sooner rather than later.
The key is to link innovation to business outcomes. Innovation isn't just a feel-good exercise in creativity; it's done with an end goal in mind, whether that's revenue growth, market expansion, customer satisfaction, or operational efficiency. Once you've tied innovation to a business outcome, it lends itself to measurement. This could be a reduction in R&D spending, an increase in patent applications, cost savings, production time, or an improvement in NPS or customer retention. Other measures could include sustainability, social impact, or employee engagement.
You can also measure the overall effectiveness of innovation by tracking all your innovations and seeing how good you are at ideation and maturing ideas through the pipeline. However, we're not quite there yet.
You need to tie innovation to some sort of outcome. However, in universities, we do a lot of fundamental research that may not lead to any product for many years. So, we need to be careful about what we mean by innovation.
One of the things we're working on right now is using technology to help triage our student population and ensure our advisors can pay most attention to the students in the most need. We're in the ideation stage of creating a student tutor that can provide 24/7 assistance. Some studies have shown that this type of technology can increase retention and graduation rates by as much as 7 to 9%, which is significant. It also saves students money by helping them graduate earlier.
We're currently looking at how we can harness AI to be not only innovative but also impactful.