WHITE PAPER

A NEW FRAMEWORK FOR ASSESSING YOUR INNOVATION PROGRAM:

INTRODUCING THE INNOVATION MANAGEMENT MATURITY MODEL™
BY PLANVIEW

Background
Today, more than ever, product innovation is critical to maintaining competiveness in today’s fast-paced, global market. Yet, as market
studies show, many companies find it hard to assess and advance their ability to innovate across the product portfolio. Tools and methods
for managing product development in organizations abound, yet none really provide a cohesive framework for assessing a company’s
innovation program encompassing the people, processes, and tools needed to speed time to market.

Seeing a way to fulfill this need, Planview created the Innovation Management Maturity Model™. Based on the Capability Maturity
Model Integration (CMMI®) framework developed by Carnegie Mellon University1, the Innovation Management Maturity Model gives
organizations a critical tool for assessing the strength of their innovation program, which is essential to continue improving productivity,
time to market, and commercial success.

This white paper explores the Innovation Management Maturity Model in detail including:

• The rationale behind the model;

• Each element that the model addresses including people, processes and tools;
• The five different levels which companies can score their maturity across people, processes, tools, and the innovation program as
a whole;
• And, applying the model to your organization.

It also provides tips and tricks for leveraging the model within your organization, to empower you on the road to innovation management
maturity success.
A NEW FRAMEWORK FOR ASSESSING YOUR INNOVATION PROGRAM WHITE PAPER

Table of Contents

Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

II. A New Way of Measuring Innovation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

III. Breaking the Innovation Model Down . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

People . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Tools . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

VII. Translating the Levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Levels 1 and 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Levels 4 and 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

VII. Applying the Model to Your Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Bring Objectivity to the Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Establish the Necessary Culture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Determine Where You’re Going . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

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A NEW FRAMEWORK FOR ASSESSING YOUR INNOVATION PROGRAM WHITE PAPER

Introduction
In a recent Tech Clarity Insight white paper, industry analyst Jim Brown asks: “Product innovation is critical to differentiate and remain
competitive in today’s fast-paced, global markets. Bolstering innovation to a core competency helps manufacturers drive higher revenue,
lower cost, and mitigate risk. So why is it so hard for companies to improve innovation performance and drive meaningful business value?”

Why indeed? Best practices and methods for managing product development in organizations abound, yet none really provide a
cohesive way to accurately measure the level of innovation associated with the process – which is key to gaining market share in
today’s increasingly competitive global landscape. So, how then does an organization determine where they stand from an innovation
management perspective and identify ways to take it to the next level?

This is the question we recently addressed at Planview, where we’ve focused on project portfolio management (PPM) for the past 24
years. We wanted to put substance around the concept of innovation and give organizations a critical framework for assessing their
innovation management maturity level, which we believe is essential to continue improving productivity, time to market, and commercial
success.

A New Way of Measuring Innovation

The Innovation Management Maturity Model™ by Planview is based on the Capability Maturity Model Integration (CMMI®) framework
developed by Carnegie Mellon University.1 Designed for product organizations, the Innovation Management Maturity Model includes
three factors which are essential to an effective innovation program: people, processes, and tools. This model encompasses the entire
full product lifecycle from idea to launch and through to end of life. While the industry is hyper-focused on idea to launch, innovation does
not stop there. Being able to manage it once each product is in market is important, as are the processes, effort, and money necessary
to terminate it.

The Innovation Management Maturity Model gives organizations the ability to rank themselves on the strength of their innovation program
in the categories of people, processes, and tools across five levels of maturity. Level 1 represents the lowest level of maturity while Level 5
is the highest, where innovation is highly optimized across people, processes, and tools. Programs can be given an overall ranking as well
as a ranking across each category. The model provides not just a level, but also a way to compare your organization to the characteristics
and best practices of other organizations across the categories.

Strategy People Process Tools

We are in a mature market where revenue is primarily driven  No cross-functional organization focused on innovation  Processes are departmentally focused and not  Manual, decentralized, un-integrated spreadsheets
from existing products and minor line extensions. There is  Decision making about the product portfolio by executive documented and basic project tracking tools
some innovation in process and operations throughout the leadership only, often with less than optimal data  No formal gated process or templates for product  Only one or two centralized applications are in use
Level 1

organization, but it is not required for company success. Our  Informal project leadership; resources assigned verbally development; projects rarely killed  New ideas for innovation captured informally
strategy is focused on conservative investments resulting in  Execution and product launches happen slow and steady  Limited visibility into actuals, forecasts, post-mortem  Reporting inconsistent and roadmapping rare,
gradual and predictable growth.  Unclear connection/hand-offs throughout commercialization assessment, or roadmaps; no portfolio reviews executed via local desktop tools
process  Processes surrounding ideation, roadmap
development, and portfolio reviews do not exist
Delivery of products, mostly line extensions and solid  Individual leaders own day-to-day processes and are  Informal process for innovation and idea flow;  Moving to shared spreadsheets in central location
enhancements to existing products, is growing in consistency, responsible for developing and delivering the product templates in use  Ideation matured to being captured and prioritized
but we typically operate in reaction mode. Our leadership is roadmap  Portfolio reviews are more project status updates  Projects managed via desktop tool but not shared
Level 2

starting to understand the need for investing in innovation.  Project managers not consistently following industry best  Metrics for evaluating innovation are purely financial  Roadmap communicated via static spreadsheet;
Our innovation strategy centers on safe bets with occasional practices  Early realization of silo inefficiency and value of gated rarely updated
calculated risks, resulting in unpredictable outcomes.  Cross-functional project teams not optimized for efficiency processes with cross-functional participation  Reporting and analytics starting to be shared and
 Innovation leaders starting to emerge and introduce change built manually
We are becoming more proactive in seeking innovation as a  Established roles in the commercialization process: process  Documented and validated gated commercialization  Manual portfolio management using spreadsheets
key part of our product portfolio. Our innovation strategy and managers, project manager, resource managers, and gate- process in place based on best practice  Desktop project management tools in use
metrics are not clearly defined and communicated, and as a  Regular portfolio reviews and post-mortems  Soon to automate the commercialization process
Level 3

keepers
result we occasionally miss market windows and margin  Beginning to champion innovation and portfolio conducted  Ideation centralized but not using a purpose built tool
targets. Our leadership team is actively investing in tools, management  Voice of the customer becoming more formalized  Standard library of reports exist; created manually by
processes, and capabilities to operationalize innovation.  Governance workflow not yet consistently repeatable IT
 A few projects being killed, but later than optimal
Our innovation strategy is emerging and we are working to tie  Early formation of a “Center for Process Excellence”  Fully implemented gated process across multiple  Product Portfolio Management (PPM) system in place
it to our strategic objectives for growth. The lack of connection  Process managers and gatekeepers have clear direction, teams with some automation automating the commercialization process
between project execution and product/corporate strategy metrics, and ownership  Gaining courage killing underperforming projects  Resource capacity planning, roadmapping, and
results in an unbalanced portfolio making it difficult to quickly  Formalized portfolio manager positions at business unit and  Portfolio metrics expanded to include resource financial forecasting being piloted within PPM
Level 4

respond to market changes. There is a growing innovation enterprise levels capacity and strategic alignment  Dedicated tool for capturing voice of the customer
pipeline, we are getting to market faster, and we are achieving  Multiple strong champions for innovation  Capturing voice of the customer with caution  Executive and project-level reporting and analytics
many of our performance metrics. Innovation efforts have  Project teams consist of cross-functional team members  Governance process becoming efficient and are available and modifiable
visibility, but it’s not yet embedded in our culture.  Start of open innovation, co-development, and the use of streamlined
external innovation consultants
We have operationalized innovation with well-defined  Executive leadership fosters innovation  Fully automated and standardized processes that are  Highly functioning PPM system integrated to other
processes and formalized tools. Innovation is embedded in our  “Center for Process Excellence and Innovation” is well- easily adaptable enterprise tools
company culture across all functions. We have a well-balanced established and reports to executive team  Portfolio metrics evolved to include competitive and  Ideation collected for collaboration
portfolio with incremental and breakthrough innovation that environmental impact scores  Product roadmap tied to project execution and
Level 5

 Decision making is collaborative and efficient

yields positive revenue growth. We have the ability to launch  Everyone throughout the commercialization process  Projects killed early and often during portfolio reviews corporate strategy via PPM
products as planned and with confidence, meeting time to understands role  Voice of the customer captured on an ongoing basis  Entire product catalog of in-market products,
market targets.  Project managers and scrum masters lead innovation and  Continuous learning loop well established including the Product P&L, managed via PPM
development teams leveraging best practices  Process covers idea to launch, and through to end of  Self-service configurable reports and metrics
life delivered across the organization

Want to learn more about the Innovation Maturity Model and how your organization can increase its maturity over time? Please contact [email protected].
Innovation Management Maturity Model by Planview. Download a copy at Planview.com/InnovationManagementMaturityModel
About Planview – Planview is a portfolio and resource management company that helps organizations maximize business opportunities by optimizing the capacity of their finite people and financial resources. Within Product Development, market leaders rely on
Planview software to collect input from customers, prioritize the best product portfolio, build the product roadmap, and manage the execution of bringing those products to market. Planview’s singular focus on portfolio management and customer-centric culture
fuels a deep commitment to continuous innovation and customer success, and is the reason it is recognized globally as a market leader. Learn more at www.planview.com.
Copyright © 2013 Planview, Inc., All rights reserved.
1
Capability Maturity Model Integration Framework, http://www.sei.cmu.edu/library/abstracts/news-at-sei/featuresept98pdf.cfm
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A NEW FRAMEWORK FOR ASSESSING YOUR INNOVATION PROGRAM WHITE PAPER

The ability to rank each aspect of your organization’s innovation management maturity is important for several reasons. To begin with,
while innovation is on everyone’s mind, there is no clear-cut path of how to manage it because it’s widely believed to be a purely creative
process. While this in large part is true, not having a way to measure and manage it leaves most organizations rudderless, with either
nebulous approaches to drive innovation or a dependency on individual ideas that often turn into pet projects without validation of
their true value in the overall product portfolio strategy. The Innovation Management Maturity Model provides a framework that defines
the level of innovation management across the product portfolio and unifies it with strategy and execution, which is a very powerful
combination. This ability to establish a definition of the true state of innovation management in the organization creates a benchmark of
performance that can potentially unify disparate opinions, against which performance (either departmental or across the organization) can
be monitored and measured. Ultimately, it is a powerful way to operationalize innovation and ensure it is embedded into every aspect of
the product development process and the organizational mindset toward it.

This model has proven to be eye-opening for many organizations. In the Fourth Product Portfolio Management Benchmark Study more
than 700 product development executives and managers were asked to evaluate their organization’s level of innovation maturity. The
majority of organizations, many large, global entities, ranked their innovation maturity between a two and three.

Which of the following best describes the innovation maturity level of your
company in terms of people, processes, tools, and overall?

Yet, when asked to rank where they want to be in terms of innovation maturity, the majority of respondents indicated that they desired to
achieve a Level 4 or 5.

Which of the following best describes your company’s end goal

in terms of desired innovation maturity level?

What also emerged in these findings is that often there is a disparate viewpoint across the organization as to the true state of innovation
management maturity. One global manufacturer shared, “Upper management is thinking we are a Level 4 right now. While the vision and
intention are there, most in our group would look at the description of Level 4 maturity and say we are not there yet. We are very financially
focused but we are not resource and capacity aware.”

The Innovation Management Maturity Model provides a tangible way to gain agreement across the organization of where things stand
today, and what the desired level of innovation management maturity is. For some organizations, it will be important to strive for a Level
5 while others may be comfortable working toward a Level 3. Either way, this model is an effective tool to define goals and measure
progress in a more uniform and more objective manner.

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A NEW FRAMEWORK FOR ASSESSING YOUR INNOVATION PROGRAM WHITE PAPER

HOW DO YOU STACK UP WHEN IT COMES TO INNOVATION MANAGEMENT?

Find out at Planview.com/InnovationMaturity

Breaking the Innovation Management Maturity Model Down

“Our motivation to move up in the maturity model is to increase shareholder value by obtaining and maintaining market share
through innovation and growth which are key to those objectives.” – Consumer Food Manufacturer

To gain an understanding of how the Innovation Management Maturity Model works, let’s examine the individual categories of people,
processes and tools.

People

This is about having an organizational structure that supports innovation, with people whose jobs are to manage the innovation portfolio.
The highest maturity organizations have a Center for Process Excellence that is productive, well established, and well-staffed. They
also have support from executive leadership and department heads who know that innovation is how the business will grow, meet the
corporate strategy, and thrive. Decision-making in the high maturity innovation organization is collaborative and efficient. Everyone
throughout the commercialization process understands their role and part in delivering against the objectives of innovation. Highly trained
project managers and Scrum masters lead innovation and development teams, leveraging industry best practices to meet deliverable and
product launch targets. While this is an ideal scenario, the majority of organizations surveyed in the Fourth Product Portfolio Management
Benchmark Study ranked themselves as a Level 3 or lower.

Which of the following best describes the innovation maturity level of your
company in terms of PEOPLE?

“Our most pressing concern around product portfolio management is getting the organization to manage the people change
management aspect required. The benefit of PPM does not exist at the individual marketing or innovation project manager, but to
the broader organization and the innovation pipeline. In the long term, I believe project managers can become more successful.
However, up front it is perceived to be added work they do not need.” – Fortune 1000 Company Executive

Processes

This refers to the automation of the commercialization process. Organizations at the highest maturity level have dynamic processes that
can easily be adapted as the market changes and the company evolves. They have fully automated and standardized processes that are
in a regular state of continuous improvement, including process deliverables, templates, and reports. Portfolio metrics have evolved from
being focused on product financials to include resource capacity, competitive impact and environmental impact scores. Projects are killed
early and often during portfolio reviews.

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Additionally, the voice of the customer is captured on an ongoing basis, using targeted challenges to drive innovation and maintain brand
loyalty. A continuous learning loop is well established and effectively incorporates post-launch learnings back into the commercialization
process. Similar to the rankings for People, the majority of organizations ranked themselves a Level 3 or lower in terms of Processes.

Which of the following best describes the innovation maturity level of your
company in terms of PROCESSES?

“Some of our brands have a buttoned up innovation processes and others kind of wing it. As a company though, we are going
through a stage gate improvement process to create better adherence to the process and this is driven top-down.” – CPG Food
Manufacturer

Tools

This refers to having a PPM system in place to automate processes, which are rolled out to everyone along the commercialization
process. The PPM application is integrated with other enterprise applications, such as the ERP and the PLM. Ideas are collected via
purpose-built, externally available applications for customer and company-wide collaboration. The product roadmap is tied to corporate
strategy and project execution via the PPM application. What-if analysis is performed against resource capacity to consistently hit launch
windows. The entire product catalog of in-market products, including the product P&L, is managed via the PPM application to leverage
platform components across multiple products. Self-service, configurable reports and metrics are delivered across the organization to
those who need access, in a format and device that works best for each individual user. As with People and Process, most organizations
feel they are a Level 3 or lower when it comes to effective use of Tools in their product portfolio management.

Which of the following best describes the innovation maturity level of your
company in terms of TOOLS?

“We are honing our product innovation pipeline, we are a level 3, absolutely moving to level 4. What’s holding us back right now
is that collectively as a group we are not locked into the key tools to get us there, in fact 25–40% of our cross functional groups
still don’t know about PPM and we need better cross discipline buy-in.” – CPG Food Manufacturer

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A NEW FRAMEWORK FOR ASSESSING YOUR INNOVATION PROGRAM WHITE PAPER

HOW DO YOU STACK UP WHEN IT COMES TO INNOVATION MANAGEMENT?

Find out at Planview.com/InnovationMaturity

Translating the Levels

To bring these categories together, what does an organization look like at each level?

Levels 1 and 2

Organizations at these levels tend to share many concerns, reflective of the fact that both lack, to a greater or lesser extent, the technological
and process support structures that would lessen data, communication, and planning problems. They have also not established resource
roles that ensure inter-team communication, as, in even the best-case scenario, individuals within business units own roadmap definition
and execution.

However, in some cases, innovation management around a particular product is not an internal priority and an organization may
intentionally stay at a Level 1 or 2. This is often seen in products that are considered “cash cows” according to the BCG Matrix, where
innovation is less important than continuing to receive the revenue stream the product generates. This revenue can then be used to fund
other products where a focus on innovation management is key.

Level 3

Organizations at this level have crossed the technology chasm from their lower maturity level colleagues by using technology to plan,
find and leverage information, and keep execution on track. With gated commercialization processes in place and established process,
resource, and project managers breaking down communication silos, these organizations are seeing definite benefits of moving up the
maturity model.

Levels 4 and 5

These organizations have embraced the journey of advancement and, by and large, recognize that innovation maturity is not accidental.
They have invested in planned growth across people, process, and tools to drive faster yet sustainable and repeatable innovation
practices. They have formed cross-functional project teams that support open innovation; their processes are dynamic and adapt to
change; and they leverage product portfolio management solutions to do it all.

Applying the Model to Your Organization

While the Innovation Management Maturity Model provides a method to assess the level of innovation maturity in an organization, there
are some “tips and tricks” for getting the most out of it.

Bring Objectivity to the Process

While the model will help start the conversation in your organization about the level of innovation management maturity within people,
processes, and tools, you will likely discover that there will be discrepancies between where people in the product development organization
think the company is versus where executive leadership thinks it is. Uncovering any disconnects between perceptions of how evolved
innovation is within the organization could present a problem. The model will help everyone take an honest look at each maturity level,
and objectively assess and agree on where they stand and where they want to get to. Gaining agreement across the organization and
establishing the right culture to support changes which enhance the innovation program are critical for this model to be truly effective.

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Establish the Necessary Culture

High maturity companies have innovation embedded in their company cultures from the boardroom to individual contributor levels across
all functions. It’s essential to have a culture that isn’t afraid to fail and, in fact, celebrates failure, learns from it, and moves on quickly. This
necessary culture comes from the top down, which is why you can’t do this on your own. Buy-in and support from executive management
on down is crucial to having an effective innovation program.

Determine Where You’re Going

If you’re going to speed time to market and move quickly, you need to have a clear direction and strategy about where to go and how to
get there. The Innovation Management Maturity Model not only lets you define where you are today, but also helps you decide where
you want to go and develop a strategy for how to get there. And, linking that strategy to investments and execution is the way into the
winner’s circle.

Learn More about the Innovation Management Maturity Model

The Innovation Management Maturity Model by Planview is available at Planview.com/InnovationMaturity.

To see how your company compares to other organizations across the globe and to get more insight into innovation and the product
development discipline as a whole, download the latest version of the Product Portfolio Management Benchmark Study conducted by
Appleseed Partners and Open Sky Research and commissioned by Planview, at Planview.com/Benchmark.

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IX. About the Author

Carrie Nauyalis, New Product Development Solution
Evangelist at Planview, is passionate about establishing
customer partnerships, developing market positioning,
defining field enablement strategies, providing market-based
feedback into Planview product development, and being
an overall evangelist and thought leader for the Product
Development market.

She is an active speaker, MBA guest lecturer, blogger, and vlogger on all things
Product Portfolio Management, with warm places in her heart for the topics of
innovation, Stage-Gate, and Agile.

Planview is a portfolio and resource management

company that helps organizations maximize business
opportunities by optimizing the capacity of their finite
people and financial resources. Market leaders
rely on the company’s solutions to manage a wide
range of portfolios, spanning product development,
IT, services, and corporate finance, resulting in an
enterprise-wide view of resources against demands.
For more information, visit www.planview.com.

© 2013 Planview, Inc. All rights reserved. All

trademarks acknowledged.

WWW.PLANVIEW.COM | [email protected] | 800.856.8600 | +1.512.346.8600 |

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