The idea that it is the organizational perception, not the measured reality, that drives next year's budget, levels of commitment, and all those "sr. mangement support" intangibles is (possibly?) discouraging, but very realistic, from my observations. Many companies talk about measuring innovation, or benchmarking the few that do, but end up with a "we'll know it when we see it" attitude.

Which is more depressing to the non-senior managers in innovation:
1. Not measuring
2. Measuring, but not making decisions based on the measurements

One reason for declining executive satisfaction may be that innovation cycles (the time and cost it takes to conceive and develop a new product) is not declining to match the shorter market lifespan of those same products i.e. the payback period is steadily declining but the innovation investment is at best stable or may be increasing! This is very apparent in some sectors I know such as consumer electronics or telecoms where there is a need for a fundamental review of how they innovate and radical improvement in innovation capability. Getting R&D and others to pause and make the connection between internal innovation capabilities and external results and then to focus on improving that capability is not easy but it can be done and the benefits are likely to be sustainable and a platform for a whole new wave of product innovation in the future.

Brendan - thanks for the comment. I couldn't agree with you more: the connection between internal capability and external results that you mention is, in my opinion, the critical missing piece to many firms' innovation programs.

There is a fallacy that I've encountered that sometimes prevents this connection from being made, and I wonder if you have any thoughts on where it originates. It says that a structured innovation program that can be directly linked to external results is one that stifles creativity. It's an ironic argument, I've always thought, in that the most creative people the world has ever produced (I'm referencing the great painters, novelists, etc.) typically were champions of a particular structure that was used in their approach to their work. They understood that structure doesn't stifle creativity, it actually enables it.

Cass- structure might enable creativity as you mention, but I think it depends on what kind of structure is being imposed. Referring to your example of painters, novelists etc, what if the structure imposed upon a novelist the number of pages a novel can occupy or the number of colors a painter can use?
But in the case of organisations who exist to make profit, a structure like the above will be a reality.
As Brendan rightly says its not easy to "make the connection between internal innovation capabilities and external results". This is where a good insight into the requirements of the targeted consumer becomes critical in a case of implementing pragmatic innovation

Shyam - great point. The type of structure makes all the difference. Do you think, then, that the folks who are against structuring their innovation programs have seen the results of poorly designed structure (i.e. a page limit on a novelist) and are loathe to repeat the mistake? Structure, of course, can be as simple or as restrictive as it is designed to be, so I would still argue against rejecting a structured approach to innovation due to fears of being overly restrictive. I would encourage organizations to design a structure that is informed by those fears.

Cass-Thanks for your comment. I agree that the page limit on a novelist case is pretty extreme but I'm sure you see different shades of restrictions in whatever you do in the corporate world. I think we should differentiate between the 'structure' in terms of the externally imposed restrictions on the process or product of innovation(eg:- cost targets, RoI) and the internal 'structure' of the methods used to achieve innovation.(eg:- brainstorming, TRIZ). I believe the structure you talked about initially is the latter. And I totally agree with you on the fact that this type of structure can be beneficial for innovation.
But in the corporate world, theres no living without the 'external' structure. So theres a need to leverage the structured methodology within the imposed restrictions to achieve pragmatic innovation.
The need of the hour is not to write a novel that just gets critical literary acclaim, but one which will sell (JK Rowling?). The new breed of successful innovator companies will be looking for are the ones with this insight

Shyam - great discussion. I love the distinction between between structure imposed by organizational need (i.e. cost targets, ROI) and those "chosen structures" that innovators utilize to achieve their results (i.e. brainstorming, TRIZ). I think we're in agreement in saying that both structures are a reality that we need to work within. The challenge, as always, is to choose the right structures (those that are best positioned to drive the results your organization is attempting to achieve).

One last word on structure, as a general observation. I've often been reminded that far from being restrictive, structure of nearly any type actually drives innovation. The greater the restriction, the more creativity is required to meet a goal. Not by any means an intended argument for extremely limiting structure, just a point of interest to mull.