2.1.1 What is an "Innovation Audit" and why use it

The Innovation Audit is a method for identifying the major company’s needs, possible weaknesses and strengths as well as the relative opportunities and threats of all factors affecting innovative performance. It is a fact-finding technique, which identifies how the company performs as well as the strong indications of what the company really needs.
The objective of an Innovation Audit is initially to develop a suitable set of metrics to better address the particular organisational context, which affects the innovative performance of a company, and then to obtain some quantitative and qualitative results by surveying all the suitable stakeholders involved in the innovation process. The overall objective is to analyse the results and provide a clear identification of company’s first priority needs as well as the strengths and opportunities that should be taken into consideration. It also assists the company to prioritise and identify the more significant actions that it should adopt. The innovation audit provides an opportunity for managers to determine whether the organisation has the required resources, infrastructure, culture, and processes to seriously consider either focusing on or improving the current state of innovation.

Among others, some of the more specific innovation audit’s objectives are to:

  • Understand current innovation performance in the main areas of strategy, process and the organisation
  • Benchmark this performance against best practice, both within sector and overall at a cross sector level
  • Assess your current capabilities before making expensive changes
  • Learn how to improve the use of all resources involved in the innovation process
  • Develop an action plan or roadmap to implement for future development.

Only with a reliable, validated and integrated Innovation Audit that encompasses the appropriate assessments and brings together in a coherent manner, can organisations establish the basis for moving forward and achieving their mission and vision.1 The objective is not only to perform the audit but also to develop the program to correct the problems and progress with new opportunities.

Content of an innovation Audit
An innovation audit is a diagnostic tool and should include questions or statements covering all areas affecting innovation. While preparing an innovation audit managers should think that there is no such thing as an absolute innovation audit recipe for all organisations. Nonetheless, it is possible to develop a number of metrics and indicators, which give some indication of the innovation capability of a company. The following indicative list contains the most important areas should be included in an innovation audit list and it can help you begin the process of auditing innovation.

Indicative list of areas should be investigated during an innovation audit

Source 2

Please stop and think for a while, which of the above-mentioned areas play an important role in your company’s innovation capacity.

  • Which do not appear to cooperate with your innovation needs?
  • Are there important problems or important margins for improvement?
  • Is it the current culture, the current level of bureaucracy or something else which you should analyse more in an innovation audit?
  • Are there enough indications that current leadership is positive in relation to innovative thinking and innovative behaviour?
  • To what extent is the current decision making policy hindering or supporting innovation?
  • Are the majority of employees satisfied with the quality of their work?

Don’t you think that in order to start a suitable innovation policy the above mentioned questions should be somehow answered or at least addressed?

1  www.innovaro.com/inno_updates/Innovation%20Briefing%2007-07.pdf
2 Ibid