22 Metrics for Managing Innovation: Lessons From Growth Leaders ^Top Pitfall One: Emphasizing Results Over Diagnostic Insights There was a strong bias towards the use of performance outcome measures. Five of the seven most popular innovation metrics measured either financial results or customer satisfaction. Outputs like revenue and profit growth due to innovations and the return on investment in innovation matter, for the promise of these results is used to justify investments in innovation. Customer satisfaction reveals the ability of the firm to create compelling offerings and please customers. Suppose customer satisfaction is poor and the financial returns are disappointing? Without process effectiveness or input metrics there is no gauge on the dashboard that will show the reason for these problems. Outcome measures are also hard to interpret because they are the result of a lengthy chain of decisions. As we noted earlier performance outcomes are lagging indicators. Conversely, metrics that precede and influence performance have several benefits. Managers can get signals of their progress towards growth goals well before the financial verdict is pronounced and the soundness of their investment decisions becomes moot. Employees can get more usable infor- mation on the actions needed to achieve the objectives, and can be incented to take those actions. Given the unclear signals from outcome measures, why are they the most often used? The usual answer is that they are familiar, and readily available from the management information or accounting systems. The underlying pitfall is not investing enough to find metrics that will provide diagnostic insights into the end-to-end process of converting innovation inputs into The best performers in our study were much better at making connections and relating their innovation investments to shareholder value creation.