Evaluating and selecting innovative ideas in the Front-End of Innovation

Abstract

Background & Purpose The inability to recognize and identify new upcoming innovations cause a great amount of large established firms to get outcompeted within their market. The challenge to identify new innovations in combination with companies’ finite resources makes it crucial for companies to make the right decisions regarding what ideas to select in the Front-End of Innovation. Ideas in the front end of innovation are characterized by an uncertain nature with limited amount of information. An adaptable innovation process is vital to help companies evaluate and select the right ideas. The high amount of uncertainty regarding innovation ideas leads to companies using inconsistent approaches to evaluate innovation ideas. Wrong decisions within the front end of innovation tend to lead to time-consuming and expensive deviations in later phases. Consequently, the aim of this study is to investigate how large established Swedish firms maneuver this challenge. The purpose of this study is to contribute insights regarding how established Swedish firms evaluate and select innovation ideas in the front end of innovation. Theory & Methodology An extensive literature review of scholars highlighting the front end of innovation and different methods to evaluate and select between innovation ideas are included in the study. The research design of the study is based upon an inductive approach. The research design takes the form of a multiple-case study. Furthermore, twelve qualitative semi-structured interviews with respondents from established Swedish firms regarding how the companies evaluate and select between innovation ideas were conducted. Findings & Conclusion Established Swedish firms are employing a front-end innovation process that is divided into different stages. Clustered together, these could be divided into a first, second, and last stage where they throughout the process screened ideas that they could ensure wouldn’t fulfill the firm's predetermined requirements. Apart from the screening within these stages, the firms aimed at throughout the process receive further information regarding the innovation ideas value in different areas. Both the process of gathering information as well as the screening was performed through either intuition or more analytical and often through a mixture of these two called a hybrid approach. As innovation ideas are characterized by an uncertain nature with limited amount of information, the firms commonly performed a lean start-up methodology. This methodology favoured utilizing intuition initially to set up hypotheses which then are analyzed throughout the process with more analytical methods. In other words, the overall trend was that the usage of intuition was mainly performed within the first stage, which then diminished along the process. In contrast, the usage of analytical methods increased along the process and was the main basis of the final last stage evaluation and selection.