Other parts of this series:
- Surveying innovation in government
- Five must-haves of government innovation
- The secret lives of government innovation leaders
- Do you make space for government innovation?
- Government innovation starts with steady stream of ideas
- Ideas to action: Executing on government innovation
- Quantifying the impact of government innovation: The proof is in the pudding
- Weaving government innovation into your strategy
- Lead with Innovation. (Your Culture Will Follow.)
- Remember the “Why” of government innovation
When it comes to investing in innovation ROI is a key consideration. But, what are the right metrics for measuring the success—and maximizing the benefits and impact—of government innovation?
Previously, we’ve explored the importance of generating a steady stream of ideas (see the Ideation pillar of the Accenture Innovation Framework) and how to turn government innovation ideas into reality.
(see the Execution pillar). Here we cover the Impacts & Benefits pillar—that is, the ways in which agencies quantify—and maximize—the value of government innovation projects.
This is the “pudding” of government innovation: where the proof is.
When we surveyed nearly 600 government leaders across 10 countries, we found broad—but far from universal—use of evaluation frameworks and business cases for innovation. More than half (58 percent) of all respondents reported using some type of framework to evaluate ROI and other impacts of government innovation. While that is certainly heartening, we further found that virtually all of the government innovation leaders (96 percent) reported creating a business case for every innovation project. This would appear to be a clear leading practice.
We also uncovered some interesting features in how agencies measure the outcomes of government innovation. Almost everyone (95 percent) indicated that they use some type of metrics—though, admittedly, many of those are “soft” (satisfaction levels, engagement or perceptions). Forty-two percent use only soft metrics; 15 percent rely on both soft and “hard” metrics (such as reduced cost, improved policy outcomes and improved productivity per employee) to evaluate efforts.
Based on our survey findings, 2/3 of agencies (66 percent) aren’t integrating hard metrics into evaluation frameworks. While there are a variety of reasons why that could be, we see lots of room for improvement. After all, government innovation leaders that report using hard metrics also report higher results across key outcomes:
- attracting and retaining talent (55 percent success among those using hard metrics, 37 percent among the rest of the leaders) and
- achieving better outcomes in citizen-facing programs (58 percent vs. 43 percent).
Beyond quantifying success lies the question of what to do with the resulting “innovation dividends.” Agency leaders often express concern that productivity and efficiency improvements will simply be swept back to general funds. And yet, our study suggests otherwise, with 59 percent of agencies reinvesting their own time and/or money saved into other priorities. Much like those that use hard metrics, those that reinvest innovation dividends report consistently higher rates of various benefits—including attracting and retaining top talent, automating processes, achieving better outcomes in citizen-facing programs, improving shared services efficiency across agencies, and developing a positive agency image with citizens. It appears to us keeping innovation dividends in the agency is another leading practice.
In our full analysis of the Impact & Benefits pillar, we share what we learned about the specific benefits that agencies are working to deliver through government innovation. We also outline three tips for more effective management of Impacts & Benefits: Create a solid business case for each innovative idea. Hard metrics are important— but soft metrics can be beneficial as well. Determine what you will do with the benefits achieved (time, money, image and/or morale).
I encourage you to review the full report and check back soon for my post on the Strategy pillar of the Accenture Innovation Framework. In the meantime, please share your thoughts and questions about measuring and tracking the benefits of government innovation. What metrics does your agency use? How do you quantify results—and how do you use the resulting “dividends”?