Innovation scorecard design: Process innovation case study in red hat software

The purpose of this paper is to transfer outcomes from a primary research project, namely a management control framework for innovations called Innovation Scorecard, in information technology (IT) businesses. Few recent studies develop a balanced framework for innovation. Thus the core of this conceptual framework is based on the Balanced Scorecard (measures company performance using four balance perspectives- financial, customer, internal business processes, and potential (Kaplan & Norton, 1992; Horvath & Partners, 2002)), the input–process–output–outcomes model (Brown & Svenson, 1988; Cardenas et al., 2011; Cooper, 1993), and the Stage Gate approach ((Cooper 1993; 1998b; 2008) divides the innovation process into different stages and gates). The Innovation Scorecard divides the innovation process into five distinct stages separated by management decision gates: (i) idea screening, (ii) project selection, (iii) innovation preparation, (iv) innovation launching, and (v) post implementation review.

The paper presents the Innovation Scorecard design for process innovation which will be performed in Red Hat (www.redhat.com) PnT DevOps section. An overview about projects in process, costs, who is working on what, and available or missing capacity is crucial since PnT DevOps is currently expanding. Senior leadership asked for suggestions regarding "delivery framework" and creating the first version for capacity planning policies. It was decided to implement the Innovation Scorecard within this essential process innovation in order to support it. First, innovation goals are set. Relationships between cause and effect among individual goals are represented by a strategy map. Innovation metrics for each decision-making gate are chosen and proper target values established. Concrete financial and non-financial metrics for each gate are presented. Next specific characteristics of each one are cataloged in an Innovation Scorecard Data Sheet. The data sheet template is presented because it provides background for a metric choice, ensuring that metrics are clearly defined and based on an explicitly defined formula and data source.

Major implications relevant to academics and practitioners stem from this case study. From a managerial viewpoint, the Innovation Scorecard may provide useful guidelines for focusing attention and expending resources during the entire innovation process. It is argued that the informed use of evaluation metrics as guideposts for increased managerial attention and identification of problems may help management prevent drop-and-go-errors in their innovation efforts. Managers may compare and contrast findings from this study with their own innovation practices and in doing so, enrich the knowledge pool upon which they draw to make well-informed decisions.