from creative ideas to innovation performance: the role of ... · that the challenge is not to come...

From Creative Ideas to InnovationPerformance: The Role ofAssessment Criteria

Marianne Harbo Frederiksen andMette Præst Knudsen

This article aims to make idea screening studies even more relevant to innovation managementby coupling a set of assessment criteria so that they can be used for identifying early productideas with innovation potential. We develop a framework, which integrates the complementarytheoretical perspectives from the creativity and innovation literatures. The approach drawsnovelty and usefulness insights from the creativity literature and combines these with noveltyand market potential insights from the innovation literature. The resulting framework encom-passes novelty of a product idea and its usefulness to the intended recipients, but with a distinctfocus on the value to the firm that can be created through market potential. This set of criteriamakes it possible to couple creative ideas for new products directly to potential innovationperformance. For the study, industry and market experts made assessments of 106 student-generated projects; these assessments underline the distinctiveness of the three criteria andsupport the value of each criterionˈs independent role in assessing the innovation potential.Two student project cases particularly shed light on the relevance of each criterion and on itsunique relationship within the framework.

Motivating the Research

Firms pursue product innovation because itmay allow them to conquer the best market

spots for commercial success (Tushman &Nadler, 1986). Seeing market opportunitiesand meeting these with the most appropriateproduct offerings are core challenges for everyindustrial firm, especially as they must performin the face of increased competition. Manyefforts to introduce new products fail(Markham & Lee, 2013) and, as a consequence,the risk of investing in new product develop-ment growswhile resources available for pursu-ing a targeted innovation strategy often arelimited. This makes the appropriate handlingof activities in the front end of the innovationprocess crucial (Poskela & Martinsuo, 2009). Inthis regard, selecting ideas that have a higherlikelihood of delivering future performance canreduce risk, focus the development efforts, andultimately enhance competitiveness by enablingthe firm to provide faster market delivery ofdesired products. Such front-end activitiesencompass, among other things, the early

identification of product ideas with the highestexpected innovation performance in terms ofpayoff to the firm.

Innovation types other than new and qualita-tively better products exist, including processinnovation, organizational innovation,administrative innovation (Damanpour, 1987),marketing innovation (Oslo Manual, 2005) andbusiness model innovation (Birkinshaw,Bouquet, & Barsoux, 2011). This article,however, focuses on product innovation andspecifically conceptualizes a set of criteria forensuring that assessment processes related tothe early selection of product ideas entail a focuson potential innovation performance.

Inspiration for this can be found in thecreativity literature where it is vehementlyargued that creative ideas are precursors of inno-vation (e.g., George, 2007; Baer, 2012). For anidea to be creative it must be novel, useful andseen as having the potential to create value tothe firm (George, 2007). However, the creativityliterature (e.g., Bissola & Imperatori, 2011;Cropley, Kaufman, & Cropley, 2011) conceptu-alizes useful ideas only as value to the users

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60 CREATIVITY AND INNOVATION MANAGEMENT

and not as value to the firm that markets theproduct. Accordingly, this article argues thatthe creativity literature can be only partiallysuccessful in advising firms about how to seekand ensure innovation performance of productideas.

In contrast with the creativity literatureˈsevaluation of product ideas from the userperspective, the mainstream innovation litera-turebrings inafirm-relevantmarketperspectiveand argues for novel ideas and commercializa-tion as the pathways to firm success. Theinnovation literature traces back to the influen-tial work of Schumpeter (1983 [1934]), whoemphasized that innovation is the result of aninvention being developed into something newto themarket and that is then exploited econom-ically. Therefore, by broadly connecting the newproduct with market potential and successfulcommercialization, the innovation literature isconcernedwith innovation performance as seenfrom a firm perspective. Some of the innovationliterature further refines the definition of inno-vation and claims that to be novel a producthas to create a change of practice, i.e., it has tolead to a newway of doing things. The implica-tion is that there is no innovation until the newproduct is put into use (Damanpour, 1987) andadopted by the recipients (Denning &Dunham,2010). However, if a new product is to beadoptedand to changeexistingpractices, itmustbe perceived as useful by the recipients. Thisentails that the user-centric usefulness criterionfrom the creativity literature should also beconsidered when assessing the innovationpotential of product ideas.

The purpose of this article is two-fold: (1) todevelop a framework which integrates thetheoretical perspectives from the creativity andinnovation literatures; and (2) to apply anempirical methodology to define and verifythe criteria for assessing potential innovationperformance of early ideas for new products.In this way, the article contributes to creativityand innovation management research by bring-ing the literatures together with respect to front-end product innovation activities. In particular,the article argues that innovation performanceis achievable if new product ideas are novel(from the creativity literature and the innova-tion literature alike), useful (from the creativityliterature and implied in some parts of the inno-vation literature), and have market potential (asargued in the innovation literature). The logicis that novelty is needed for some degree ofdifferentiation to be achieved compared toexisting products; usefulness is needed forcreating value to the recipients and makingthem adopt the change of practice that a newproduct implies; and sufficient market potentialis needed for expected economic exploitation of

a new product and, thus, generating value tothe firm. Through this integrative approach,the article reveals that although a novel and use-ful product may lead to innovation because it isadopted by the market (Denning & Dunham,2010) and entails a change of practice(Damanpour, 1987), an additional requirementfor arriving at innovation performance is the exis-tence and later exploitation of sufficient marketpotential.

Thus, the article adds a critical conceptual in-put to the discussion about what is required togo from no innovation through innovationand, ultimately, to innovation performance.We question whether criteria and measure-ments used by creativity researchers are suffi-cient and adequate to inform firms about ideaswith the potential to lead to innovationperformance. In the same way, we questionthe mainstream innovation literatureˈs focuson novelty and commercialization as sufficientand adequate by themselves for living up tothe innovation requirement for adoption andchange. We find each view to be individuallytoo narrow and suggest expanding the notionof creative ideas as not simply precursors ofinnovation but as precursors of innovationperformance.

Theoretical Exposition

Ideas are not the sole ingredient of innovation(Flynn&Chatman, 2001; Denning, 2011). None-theless, they are important, as a firm pursuing aproduct innovation strategy needs ideas fornew products. Fleming (2007, p. 69) in his workon the ‘long tail’ of innovation forcefully arguesthat the challenge is not to come up with ideasbut that the distribution of the value of ideas ishighly skewed and almost ‘all inventions areuseless’. Therefore, firms need to considerwhich ideas – from amongst a large pool ofoptions – are the ones with higher potentialinnovation performance, and which ideas areat best mediocre. Ideas for new products thatare expected to have the highest potential tolead to payoff to the firm should be prioritizedand receive investment, whereas the remainingideas should be discarded with a minimum ofresource investment.

It is widely demonstrated in the new productdevelopment literature that firms seek toidentify new product performance alreadywhen screening the first ideas for new offerings(e.g., Hart et al., 2003; Carbonell-Foulquié,Munuera-Alemán, & Rodríguez-Escudero,2004; Schmidt, Sarangee, & Montoya, 2009).This is a relevant approach, as assessments ofideas, especially in the front end of innovation,impact whether the final product will become

FROM CREATIVE IDEAS TO INNOVATION 61

© 2017 John Wiley & Sons Ltd Volume 26 Number 1 2017

a success in the marketplace (Bacon et al., 1994;Poskela & Martinsuo, 2009). Moreover, there isvalue to be gained in terms of saved time, focusof resources, as well as higher success rates(Cooper, 1985). It is certainly not an easy taskto ensure the early identification of the mostpromising product ideas, also because existingresearch points to a large number of assessmentcriteria, including technical feasibility, strategicfit, and financial issues, to mention a few. How-ever, the chances of new product successincrease by keeping the goal of product innova-tion in sight (Markham & Lee, 2013). Thisspeaks in favour of considering a few butdistinct criteria for assessing new product ideas.But what are they?

Keeping the Goal in Sight

Although creativity and innovation scholarsagree that ideas are crucial to innovation (e.g.,Amabile et al., 1996; Day, 2007; Bledow et al.,2009; Artz et al., 2010; Baer, 2012), there areapparent differences within and across the twostreams of literature in terms of what character-izes the best ideas. Table 1 displays referencesfrom the creativity and innovation researchselected to show the variety of viewpoints thateach emphasizes as prerequisite(s) forinnovation.

Innovation is basically about change(Damanpour, 1987), and the innovation and cre-ativity literatures alike agree that novelty is aprerequisite for change. Novelty is both concep-tualized as absolute (something new) and inrelative terms (adegree of uniqueness comparedto existing alternatives). However, according tothe creativity literature where creative ideas areseen as precursors of innovation (e.g., George,2007; Baer, 2012), novelty alone is insufficient:ideas must also be useful (e.g., Flynn &Chatman, 2001). In particular, Amabile (1997,p. 40) stresses that ideas ‘canˈt be simply bizarre;they must be appropriate to the problem oropportunity presented’ in order to be imple-mented successfully and create value to thefirm.Even though value creation to the firm ismentioned by her and other creativity scholars(e.g., George, 2007), this firm focus is neitherexplicitly researched nor linked to the ideaassessments. There are important benefits ofincluding novelty and usefulness as criteria forassessing the innovation potential of ideas. First,some degree of novelty makes a product standout in the marketplace (Rogers, 1983). Second,the usefulness criterion will focus the assess-menton the appropriateness, orvalue, of aprod-uct idea (Amabile, 1997). However, novelty andusefulness are almost always measured as oneconstruct in the creativity literature (see thereview by Sullivan & Ford, 2010), which makes

it difficult, if not impossible, to detect whetherand how also the value to the firm is taken intoconsideration. Therefore, one may ask: ‘usefulor valuable to whom, and for what?’ (Bilton,2007, p. 4). The assumption could be that if usersare happy with the product offering and adoptthe product, then, seen from the firmˈsperspective, the product may also provide theexpected commercialization and subsequentincome. We question this automatic impliedcausality between arousing usersˈ interest bymeeting their needs with a novel and usefulproduct, and innovation performance in termsof successful commercialization and value tothe firm.

The usefulness-to-the-recipients requirementis rarely found in the innovation literature. Infact, ‘useful’ is not mentioned in any of the 60definitions of innovation reviewed byBaregheh, Rowley, & Sambrook (2009). Asshown in Table 1, one recent exception is,however, Bledow et al. (2009) who include ‘use-ful’ in their definition. The Oslo Manual (2005)offers one of themostwidespread and used def-initions of product innovation but emphasizessolely novelty OR significant improvements asneeded for product innovation. Although theconcept of ‘significant improvements’ may berelated to ‘usefulness’, such interpretation can-not be directly inferred from the manualˈs defi-nition. Rather, the innovation literaturegenerally emphasizes commercialization, alongwith novelty, as the important prerequisites forinnovation (e.g., Utterback & Abernathy, 1975;Schumpeter, 1983 [1934]). With this focus, theinnovation literature raises attention to theability of new products to create value forthe innovating firm which, in a businesscontext, is also the ultimate reason for focusingon product innovation.

Interestingly, Denning (2011, p. 22) empha-sizes that ‘the key to success is adoption ofpractices, not the invention of ideas’. Asmentioned, novelty is needed for capturing theattention of the potential recipients of a newoffering; but, if the users do not value thenovelty nor perceive the change as useful, thenthey may not adopt the new product. And eventhough some people are stimulated to buy aproduct simply based on its newness, themajor-ity of users expect more (Rogers, 1983). Forinstance, if a novel product is purchased impul-sively based on its immediate desirability or awish to follow a trend and it turns out not tobe useful, then it will most likely not be adoptedby the users. However, if the new product isalso perceived as useful compared to existingalternatives, it might satisfy users sufficientlyto lead to their change of practice.

This perspective lengthens the time perspec-tive of the innovation process, because it takes


Volume 26 Number 1 2017 © 2017 John Wiley & Sons Ltd

Table1.

PrerequisitesforInnovatio

nas

Identifi

edin

theCreativity

andInnovatio

nLiteratures

Referen

cePrerequisite(s)

forInnov

ation

Nov

elty

Usefulness

(Successful)

Com

mercialization

Adop

tion

/utilization

TheCreativity

Literature

Amab

ile(1997,p.

40)

‘The

successful

implem

entatio

nof

(tho

se)n

ovel,

approp

riateideas.’

••

(•)

(•)

OˈQ

uinan

dBe

semer

(2006,p.

35)

Novelty

(new

materials,

new

processes,ne

wconcep

ts,etc.),

resolutio

n(peoplecan

unde

rstand

how

touse

it),a

ndelaboration

andsynthesis(how

the

prod

uctp

resentsitself

tothecu

stom

er)o

fideas.

••

Cropley

and

Cropley

(2012,p.

35)

‘sellin

gtheresultof

the

creativ

eprocessto

othe

rpe

ople.’

••

•

TheInnov

ation

Literature

Schu

mpe

ter

(1983[1934])

Aninve

ntionbeing

deve

lope

dinto

something

new

tothe

marke

tand

then

being

exploitedecon

omically.

••

Utterba

ckan

dAbe

rnathy

(1975,p.

642)

‘ane

wtechno

logy

orcombina

tionof

techno

logies

introd

uced

commercially

tomeeta

user

ormarketn

eed.’

•(•)

•

Dam

anpo

ur(1987,p.

676)

‘ane

widea

[is]p

utinto

use[...]whe

nits

•(•)

•

(Contin

ues)



Table1.

(Contin

ued)

Referen

cePrerequisite(s)

forInnov

ation

Nov

elty

Usefulness

(Successful)

Com

mercialization

Adop

tion

/utilization

actual

utilizatio

n...

hasbe

gun.’

OsloMan

ual

(2005,p.

48)

‘theintrod

uctio

nof

ago

odor

servicethat

isne

wor

sign

ificantly

improv

edwith

respect

toits

characteristicsor

intend

eduses.’

•(•)

(•)

Bled

owet

al.

(2009,pp

.305

and308)

‘thede

velopm

enta

ndintentiona

lintrodu

ction

ofne

wan

duseful

ideas.’

••

(•)

Den

ning

and

Dun

ham

(2010,p.

6)

‘thead

optio

nof

ane

wpractic

ein

acommun

ity.’

••



time for adoption to occur with newly intro-duced products to the market. It is far fromtrivial to get users to adopt a new product andalter their practice in using it. The process ofadoption starts with passive acceptance which,after a persuasion period, may or may not leadto active acceptance and later to the intentionto adopt the new product. The process of adop-tion may end in failure, either due to immediatepassive resistance to novelty or due to laterrejection of the product (Talke & Heidenreich,2014). There is a risk that the user getsdisappointed as they encounter challenges orunsolvable problems in use, which may poten-tially lead to dismissal of the product and evenbad word of mouth. The latter could easilyand negatively impact the success rate ofcommercialization (Talke & Heidenreich, 2014)as the potential market diminishes.

Figure 1 illustrates how we define the inno-vation process as a multi-stage process with aset of activities starting from the preliminaryexamination of the idea and into the actualproduct development process. After develop-ment and market introduction of a new prod-uct, the process of adoption (or rejection) ofthe product by the recipients will impact theextent of commercialization, i.e., whether it willbe successful or not, and ultimately the innova-tion performance. Additionally, the adoptionpatterns of the users may serve as input forimproving the product towards the next gener-ation (illustrated by the dotted line going backinto the new product development process).

Thus, Figure 1 serves to illustrate the funda-mental basis of the article and shows the overallprogression during an innovation process. Themainly linear sequential illustration is not to betaken literally, as the process of innovationconsists of iterations of inseparable and simulta-neously coupled stages (Galbraith, 1982). More-over, the stage-gate new product developmentprocess, which is indicated by the grey andwhite rhombuses, is only to be regarded as anexample of how firms can apportion activitiesrelating to the process of new product

development. Product ideas are screened atthe ‘Idea selection’ gate in order to establishtheir potential and decide whether to com-mence new product development. Cooper andKleinschmidt (1993) suggest that more, minorgates can precede this point: first, an initialscreen based on a set of ‘must meet’ and ‘shouldmeet’ criteria; second, a rough assessment ofmarket, technical, financial, legal and otherorganizational aspects based on an inexpensive,preliminary investigation; and, finally, afterinvestigating the idea thoroughly and buildinga business case including, for example, detailedmarket studies, a competitive analysis,manufacturing assessments and a financialanalysis, it is decidedwhether tomove to actualnew product development. Thus, idea screen-ing can be made in more steps, with the list ofcriteria being tougher from gate to gate (Cooper& Kleinschmidt, 1993). However, in order toemphasize that firms spendmore time on actualnew product development than on initial inves-tigations, our division and naming of stages inFigure 1 is different from that of Cooper andKleinschmidt (1993).

Judging from the differing viewpoints thatare listed in Table 1, product innovation canoccur at three different points in time: (1) whenthe product is introduced on the market; (2)when the product is put into use and adoptedby the recipients; or (3) when the product isexploited economically. The definition as illus-trated in Figure 1 is clearly aligned with thesecond view. We infer that a novel product –an invention – that is introduced on the marketdoes not in itself change existing practices.Rather, ‘inventions become innovations onlywhen they are adopted into practice’ (Denning& Dunham, 2010, p. 6). This points to potentialshortcomings in the mainstream innovationliterature as it does not focus on adoptiondriven by the usefulness of a new product as aprerequisite of innovation. We suggest that forinnovation to happen, a product must be bothnovel and useful so that it meets the needs andwishes of the recipients and has the potential

Figure 1. A Simplified Illustration of an Innovation Process



to be adopted by them. However, we also inferthat for arriving at innovation performance as seenfrom a firm perspective, the product has to beexploited economically.

Interestingly, the most important determi-nants of new product success are (apart fromdedicated human resources and qualityexecution of key new product developmentactivities): product advantage, meetingcustomer needs and market potential (Cooper& Kleinschmidt, 1993; Henard & Szymanski,2001). The first two determinants clearly relateto novelty and usefulness, and the latterconfirms the need to also consider the potentialmarket.

Based on the above, we suggest three criteriaconsisting of novelty, usefulness andmarket poten-tial for assessing the innovation potential ofearly new product proposals. Apart fromreflecting the most important determinants ofnew product success, the criterion-concept alsosupports that both the user perspective andthe firm perspective are taken into accountwhen assessing early product ideas. Therefore,while we criticize the mainstream innovationliterature for not addressing the usefulness of anew product, we also urge the creativity litera-ture, when assessing new product proposals,to focus on firms by considering specific com-mercialization aspects in relation to the product.

Different New Product Strategies

We suggest that different combinations ofnovelty, usefulness and market potential ofnew product proposals will lead to differentoutcomes.

Chasing product innovation by introducingproducts that live up to the three criteria isjust one of many pathways that, dependingon the firm strategy, may be consideredsuccessful. Although it is seldom legal, firmscan also choose to stake on imitated goods,such as copies of a popular bag or a watch,i.e., products that are known as being bothuseful and desirable and have marketpotential because they are cheaper than theoriginal (illustrated as U + MP in Figure 2).Owing to their imitative nature, these arenot characterized as novel.

Another path to successful commercializa-tion could be to introduce a one-day wonder,i.e., a novel and immediately desirable productwhich, however, is not useful but sells well dueto an intensive marketing push strategy(illustrated as N + MP in Figure 2). Importantlythough, neither imitated goods nor one-daywonders can be regarded as product innova-tion. A one-day wonder may be novel andimmediately interesting and, based on this,lead to a sufficient number of people acquiringit as an impulse buy, but if it is useless it willneither be adopted nor change user behaviour.An imitated good may be just as useful as theoriginal (yet cheaper) and therefore be boughtby a sufficient number of people, but it is notnovel and so it does not qualify as innovation.Rather, we argue that for innovation to occura product has to be both novel and useful(N + U) in the sense that the new features (in-cluding the change of practice they imply) areadopted by the recipients. An example of prod-uct innovation could be that an ingenious manconceives and makes – free of charge – a devicethat will enable his disabled friend, who has anextremely rare build, to sit in and drive a car. Itis a tailored product that is both novel and use-ful and has a huge potential for changing apractice (or rather leading to a new practice).It is, however, not (and does not automaticallyhave the potential for being) exploited econom-ically. Thus, product innovation does notalways lead to innovation performance interms of profit. Maybe it is not intended to, ormaybe the market size is too small to lead toreturn of investment. For innovationperformance to be accomplished, in a businesscontext, a novel and useful product also has tosell well. Thus, it has to live up to all threecriteria (N + U + MP).

Empirical Investigation

We explore the relevance of each of the threecriteria in an educational settingwith universitystudents. In order to establish thedistinctivenessof the criteria, we asked industry and marketexperts to rate novelty, usefulness and marketpotential of student-generated productproposals.

Figure 2. Different Strategies Leading to Different Outcomes (N = Novelty; U = Usefulness; MP = MarketPotential)



Setting, Population and Sample

The data for the empirical investigation werecollected in the autumn terms 2012–2014 in con-nection with a recurring project-based course,Experts in Teams, at the Faculty of Engineeringat the University of Southern Denmark. Theoverall purpose of this ongoing course is forthe students ‘to apply their technical knowledgeto develop a business idea’,1 i.e., to strengthenthe studentsˈ ability to generate ideas and workwith entrepreneurship in cross-disciplinaryteams. The course description further states that‘a business idea is the innovative idea thatsolves a problem or fulfils a need. It can be acompletely new product/service or it can bean improvement of a product/service, aproduction method or a new way of doingsales.’ Hence, the course description allows fora relatively broad spectrum of ideas.

A few hours a week over a period of3½ months, the students worked in teams andeach team created a product idea as well asinvestigated market and business aspectsthereof. In total, 858 students were engaged inthe course with 216 students in 2012, 260students in 2013 and 382 students in 2014. Atthe beginning of a course, each student chosean overall engineering theme to work within,such as ‘New Energy Sources’ or ‘OffshoreWind Power’, which were used to form theproject groups by the supervisors (average ofsix students per group). The supervisor ensuredthat at least three different lines of study wererepresented in each project group.

The supervisor was strongly involved in thedevelopment of the ideas and in guiding thegroups through the work by providing regularfeedback. Therefore, the research team hasexcluded the supervisors as evaluators in theanalysis for the research, as they would beunable to provide unbiased assessments of theprojects. This is only natural, as the supervisorrole is comparable to the project managementrole in a firm setting, and project managers areexpectedly also biased in assessing their ownprojects in comparison to other projects runningin parallel within the business.

The vast majority of the students were study-ing in the Bachelors of Engineering program,but within different specializations such aselectronics, energy, manufacturing, mechanics,integrated design, and product developmentand innovation (in total 17 lines of study).Approximately 3% of the students came fromother educational institutions and studied tobecome, for example, multi-media conceptdevelopers. Each year a number of participantswere exchange students from other countries,mainly studying within the fields of civil,manufacturing and mechanical engineering.

Each project group consisted of a number ofstudents, who all received a few hours of idea-tion technique training and basic knowledge ofinnovation and business planning in the pursuitof an innovative idea. Every year, at the end ofthe project period and prior to the exam, eachgroup handed in a report consisting of a prod-uct idea description and a rough business plan.Although the groups did investigate and reportcertain business aspects and also sketched theirproduct idea in a computer-aided-designsystem so that it looked more like a finishedconcept, the outcome was merely equivalent towhat is presented and assessed in a businesssetting at an initial idea screening gate (as illus-trated in Figure 1; equivalent to Cooper &Kleinschmidtˈs gate 2). Thus, despite the factthat the groups worked on their projects overa period of 3½ months, the product ideas werenot yet conceptualized to a level that wouldjustify comparison to what is typicallypresented at a later gate encompassing moredetailed assessments.

The level of analysis is the project. The unitof analysis is the innovative product ideawhich the students presented in their project re-port at the end of the course. The sample con-sists of 106 product ideas, i.e., the proposalsmade by 106 groups (out of 136 groups, aparticipation rate of 77.9%. The sample by year:2012 = 33 out of 33 product ideas, i.e., 100%;2013 = 28 out of 41 product ideas, i.e., 68.3%;2014 = 45 out of 62 product ideas, i.e., 72.6%).

Experts and Assessments

The assessments of the novelty, usefulness andmarket potential of the product ideas weremade by external examiners in conjunctionwiththe project exams in January 2013, January 2014and January 2015.

The external examiners (n = 15, of whomsome participated more than one year) wereprofessionals with more than 16 years of rele-vant work experience (except one who hadmore than 10 years of relevant work experi-ence); all of them were managers at some leveland highly knowledgeable about businesstrends and technological development in arange of relevant industries. In most cases, theywere selected by the supervisor teams to ensurethe best fit between the engineering theme andthe expertise of the external examiner. Thus,these experts were included in the examinationsto represent the market and business perspec-tives. They can be characterized as beingoutside academia and inside business, i.e., asindustry and market experts.

One expert filled out a rating sheet for eachproduct proposal submitted by a group, whichresulted in one expert assessment per group.



Thus, each expert had an exclusive sub-sampleof projects to assess, and no project wasassessed by more than one expert. The numberof projects each expert assessed differed fromexpert to expert (as an example, in 2012 theaverage was approximately five). Withoutrevealing the research purpose to the experts,they were asked to rate the product proposalson novelty, usefulness and market potentialseparately. The external examiners were remu-nerated by the university for participation inthe exam and for reading the reports, but theassessment of the projects for the research wasnot part of this remuneration and was, instead,done voluntarily as an additional task.

Table 2 shows the 0–100% assessment scalesused by each expert to evaluate their assignedprojects on the three criteria of novelty, useful-ness and market potential.

Empirical Results

The purpose of the following empirical analysisis first to establish the distinctiveness of thethree criteria aswell as to illustrate the relevanceand implications of applying the criterion-concept.

Table 3 shows the descriptive statistics of the0–100% assessment made by the experts of theproduct ideas for the three combined sampleyears. The assessments reveal that marketpotential is on average rated lowest (39.50),whereas novelty and usefulness are ratedhigher and somewhat similar (49.58 and 51.49).

In order to assess whether the three criteriaare independent, we examine their mutualcorrelations. If the criteria are dependent oneach other, we expect to find correlationsaround 0.8 or higher. Table 3 shows that noveltyis correlated with usefulness and market poten-tial to a lower degree (0.289 and 0.362) than the

mutual correlation of market potential andusefulness (0.565). But all three are well belowthe dependence threshold; hence, the threecriteria are independent and we can observethat usefulness and market potential have atighter, though distinct, connection. Similarly,we performed the analyses on the yearly sub-samples, and these confirmed that novelty hasa lower correlation with usefulness and marketpotential than these two have with each other.

Due to their moderately strong correlation,one might still expect that usefulness andmarket potential could, in fact, become oneconstruct. To investigate this hypothesis, andfurther test the independence of all three vari-ables, we performed a principal componentanalysis (Table 4). The component values≥0.940 (shown in bold) support that the threecriteria are independent. Thus, these resultsindicate the distinctiveness of the three criteriaand, thereby, support the theoretical argumentsfor separately assessing new product proposalson novelty, usefulness and market potential.

Illustrations of Student AssignmentsAccording to the Framework

Setting the threshold for potential high perfor-mance at ≥75% per assessment criterion, wemade a comparison of the framework presentedin the theoretical exposition (Figure 2) and the106 student-generated product ideas. It showsthat only seven product ideas can be character-ized as having the potential to lead to innovationperformance (N + U + MP = 6.6%). These sevencases are simultaneously a subset of the tencases that can be characterized as innovation(N + U = 9.4%). Only four of the cases arecharacterized by potential performance, but noinnovation (U + MP = 3.8%). In total, this illus-trates that 14 product ideas (13.2%) are part of

Table 2. Descriptions Provided to the Experts for Carrying Out the Assessment of the Three Criteria forIdentifying Innovation Performance

Criterion Assessment DescriptionAssessment on a scale from 0–100%

Novelty 0 = There is nothing new or original in the product idea/proposal (only known solutionsand knowledge passed on in a new way).100 = The product idea/proposal is entirelynew and original.

Usefulness 0 = The product idea/proposal does not fit the needs and wishes of the targetgroup(s), (i.e., the potential customers/users).100 = The product idea/proposal isentirely aligned with the needs and wishes of the target group(s), (i.e., the potentialcustomers/users).

Marketpotential

0 = The product idea/proposal is unlikely to attract sales and be sufficiently profitable tobring onto the market.100 = The product idea/proposal will likely attract sales and besufficiently profitable to bring onto the market.



the framework and the remaining 92 productideas (86.8%) are what would be characterizedas no performance and no innovation. This highshare of product ideas with no performancefollows the argument of Fleming (2007, p. 70)that ‘almost all inventions are useless’. In abusiness setting, using the three criteria, themajority of product ideas should thereforelikely be discontinued early in the process.

We conceptualize innovation potential asnovelty plus usefulness of ideas. Nonetheless,we also tried to identify the innovation casesas they are defined in the mainstream innova-tion literature (N + MP = a novel product thatis commercialized successfully). This categoryis missing from the empirical sample. This doesnot imply that the category does not existconceptually, only that the students were lessable to produce ideas that were also character-ized by market potential. For further scrutiny,we selected those product ideas that were mostradical (as represented by the extent of novelty).In total, 18 product proposals (17%) werecharacterized by high novelty (75% or above),but with low (below 50%) or medium (between50 and 74%) usefulness and market potential.

To illustrate the combinations further, wepresent two cases from the student projects:one of potential innovation performance (theproject with the highest rating of all 106proposals) and one of only high novelty but

lower usefulness and market potential. Thus,these projects comprise one case of noveltymainly (and some usefulness) and one case ofinnovation performance (according to the frame-work). One of the supervisors, who supervisedboth project groups and was present at boththeir exams, together with the externalexaminer (expert), has confirmed the descrip-tions below. Based on the dialogue during theexams, he had insights into the reasoningbehind the expert ratings.

Case 1: Accessibility to offshore wind turbines(novelty)

This product idea was rated high on novelty(80%), slightly above average on usefulness(59%), but low on market potential (12%). Thegroup of students2 affiliated with the engineer-ing theme ‘Offshore Wind Power’ presentedthis idea of how to ensure better and safer acces-sibility from ships to offshore wind turbineswhen a turbine needs maintenance. Currently,the approach to the wind turbine from the shipis made by jumping from the ship to a ladderand then climbing up the turbine. However,the challenge is that the slightest movementcaused by waves can complicate access or evenhave fatal consequences such as techniciansfalling or getting stuck between the ship andthe turbine. The group suggested to approach

Table 3. Descriptive Statistics of the Expert Ratings, 2012–2014

Ratings by Experts2012–2014

N Min. Max. Mean Std. dev. 2 3

1. Novelty 0–100% 106 2 95 49.58 26.062. Usefulness 0–100% 106 2 100 51.49 25.83 0.289**3. Market potential 0–100% 106 0 90 39.50 24.52 0.362** 0.565**

** Correlation significant at the 0.01 level (two-tailed). 100% = highest level.

Table 4. Principal Component Analyses of the 0–100% Assessments (2012–2014)

Ratings by Experts2012–2014

N Component

1 2 3

Novelty 0–100% 106 0.979 0.122 0.161Usefulness 0–100% 106 0.130 0.950 0.283Market potential 0–100% 106 0.178 0.291 0.940Extraction: % of variance 60.7 25.0 14.3

Note: Rotation Method: Varimax with Kaiser Normalization. Rotation converged in four iterations.



this challenge by adding a large electromagnetto enable the connection of ship and turbine.

Based on the idea description, the project canbe seen as comprising some of the work preced-ing actual new product development. Thereport presented at the exam included prelimi-nary calculations for determining the feasibilityof the magnet solution and budgeting, includ-ing payback period scenarios. The groupfurther argued that their solution would makeit safer to do maintenance, as the solutionwould stabilize the ship and the turbine andthus be more useful than existing solutions onthe market. However, the group also estimatedthat the product would take up more deckspace, be heavier, require more power and, lastbut not least, be more expensive than the maincompetitorˈs product.

The expert ratings reflect that the productidea is a novel (N) way of using magnets inthe particular context, and it would probablybemore safe to use (U) compared to the compet-itorˈs product. However, the downsides withregard to size, weight and power consumption(all related to U) prevented a higher score onusefulness. Also, since salt water and electricalequipment rarely go well together, it is reason-able to assume that the solution would proba-bly not work (U) in an offshore marineenvironment. Moreover, the higher cost wouldresult in a more expensive product and wouldlikely also make it less attractive (MP) than theexisting solution. Clearly, the group presentedan early idea that needed further validationbut it is still likely that the shortcomings identi-fied already at this stage would result in limitedsales and, thereby, lead to commercial failure.Thus, it may be that the new product, if intro-duced on the market, would be adopted by afew recipients that prioritize safety above alland, therefore, are ready to pay the higher pricedespite the mentioned downsides. But, it ismore likely that the ‘firm’ would not invest indeveloping the product idea further due to theanticipated challenges and downsides. Hence,the product idea could be regarded as havinginnovation potential (N + U), but it is unlikelythat it would lead to innovation performance(N + U + MP).

Case 2: Electrification of bus shelters using solarpanels (innovation performance)

Only seven product ideas were rated high bythe experts on all three criteria and, therefore,constituted the possibility to achieve innovationperformance. One of these product ideas(novelty =95%; usefulness =88%; marketpotential =87%) was made by a group ofstudents3 within the engineering theme ‘SolarPanels’. This project group suggested to

integrate solar panels into existing types of busshelters. Their idea was to mount LED spotsand light up the bus shelters from energy de-rived from the solar panels, and to also addnew features such as Wi-Fi and rechargers forelectric devices, for people to use while waitingfor a bus.

The report presented at the exam included astakeholder analysis, an estimation of potentialtarget groups, and a competitor analysis forthe product idea. Moreover, they added invest-ment calculations based on rough estimatesincluding, for example, target costing, and theyalso made some preliminary strain and loadcalculations to render probable the solutionwith mounting solar panels on an existing busshelter. This project can also be seen as compris-ing some of the work preceding actual newproduct development.

The expert rated this idea as high as 95% onnovelty, usefulness at 88% andmarket potentialat 87%. Hence, the product idea was deemed topotentially become an innovation success andto likely present options for adoption by a suffi-cient number of potential customers to becomea case of successful commercialization. Theproduct idea can be characterized as drawingupon a combination of previously unrelatedbut known technologies. Basically, the expertsaw it as a creative idea (N +U)with innovationpotential seen from a firm perspective (alsoMP), i.e., a further development of the ideaand subsequent market introduction of the finalproduct could lead to relatively fast innovationperformance. Despite its high ratings, the ideaultimately represents a potential incrementalinnovation (combining existing elements in anew way) with low barriers to copy forcompetitors.

Discussion

The purpose of this article was two-fold: (1) todevelop a framework which integrates theoreti-cal perspectives from the creativity and innova-tion literatures; and (2) to apply an empiricalmethodology to define and verify the criteriafor assessing potential innovation performanceof early ideas for new products. The frameworkpresents three criteria: novelty, usefulness andmarket potential. The criteria are derived fromthe creativity and innovation literatures respec-tively. These literatures agree on the importanceof the novelty criterion as a prerequisite ofinnovation, whereas the creativity literatureadds usefulness to the potential recipients ofideas (e.g., OˈQuin & Besemer, 2006), and theinnovation literature brings in the businessperspective, adding a requirement for returningvalue to the firm from developing and



commercializing a new product (e.g.,Schumpeter, 1983 [1934]).

While the creativity literature assumes that anovel and useful idea eventually will also besold and hence bring income to the firm, weargue that the market potential must be consid-ered explicitly in parallel with novelty andusefulness. A focus on the market is needed inorder to know what to compare to; i.e., hownovel and useful is a product proposalcompared to existing offerings in the market.Moreover, what is the estimated market sizeand what are the economic consequences (cost,price and potential market share)? This viewrepresents the firm perspective: can the firmearn profits on the solution? By including themarket potential criterion alongside noveltyand usefulness as an overall criterion forcreative ideas to lead to innovation perfor-mance, we emphasize that as a ground rulethe potential financial performance should berepresented already in the early phases of theidea development process.

The findings from the student setting showthat novelty, usefulness and market potentialrepresent dimensions to consider separately.Certainly, the weighting may differ for thedifferent criteria and likely across differentproduct groups and even industries. Thismeans that an idea may not automatically bediscarded due to weaknesses related to one ofthe criteria alone.

A set of overall criteria probably matters themost when assessing early and sketchy ideas(Hart et al., 2003). However, we acknowledgethat for a detailed understanding of thestrengths and weaknesses of an idea, it mayindeed be relevant to assess a range of sub-criteria. In a firm context, the early assessmentof ideas would be accompanied by consider-ations of technical feasibility (Hart et al., 2003).This criterion can be seen as closely linked tonovelty (the need for/the risk of new technol-ogy) and considerations of how difficult or easyit would be to realize the novel idea. Firmswould also consider the stakeholders of a newproduct proposal, including those potentiallybuying and those potentially using the product;customers and users do not necessarily shareneeds and wishes (Kotler, 2003) for whichreason the usefulness criterion encompassesstakeholder nuances. Moreover, the usefulnesscriterion can be seen as tripartite, as explainedby Sanders (1992), as a new product must beboth useful (users need and will use theproduct), usable (the product is either easy touse or requires an acceptable time of learning)and desirable (customers and users want theproduct). Finally, strategic fit and financialissues may also be taken into considerationwhen screening product ideas.

The assessment criteriaˈs direct relationshipwith actual innovation performance is highlyrelevant; equally important is the distinct roleof each criterion. It is, however, beyond thescope of this study to investigate and verifythe sub-criteria and the weighting of the overallcriteria, and as such we leave these investiga-tions for further research.

This article makes a theoretical contributionto the creativity and innovation managementliteratures by complementing and combiningthe existing criteria. Identifying creative ideaswith the potential to lead to innovation perfor-mance requires a multi-dimensional assessmentfocusing on novelty, usefulness and marketpotential. Our theoretical framework suggestsdifferent constellations of the three criteria,which lead to different types of performance.Two of these constellations are particularlyinteresting to the field of creativity and innova-tion: a product idea that is novel and useful hasthe potential to change existing practices and,thus, the potential to become innovation,whereas ideas that likely live up to all threecriteria have the potential to lead to innovationperformance. The framework, together with thefindings regarding the criterion-concept, givesrise to a (re)consideration of the definitions ofwhat constitute creative ideas with innovationpotential. Therefore, we suggest that creativityand innovation management studies utilize theframework to more specifically illustrate whatis being studied and describe how it is done.

The student product cases exemplify two ofthe constellations in the theoretical framework.The idea for electrification of a bus shelter bymeans of solar panels is a case of potential inno-vation performance due to the high rating on allthree criteria. The conclusion is that it is avaluable idea worth developing further. Theidea for using a magnet to connect a ship anda wind turbine was assessed by the expert ashigh on novelty but medium on usefulnessand very low on market potential. This case, inparticular, demonstrated that the idea waschallenged by an existing alternative in themarket, which would imply both a moreexpensive product as well as a heavier andlarger solution. These insights indicate theimportance of involving competitor analysis aswell as the economic conditions in the marketwhen assessing an idea. Most likely, such obser-vations would form part of the assessment ofthe product idea in a business setting andwould result in a decision that the idea shouldnot be pursued further. Along these lines,Amabile (1998, p. 83) cautions that ‘not everynew idea is worthy of consideration’ andemphasizes that ‘managers look for reasons tonot use a new idea instead of searching forreasons to explore it further.’ There is a risk that



highly novel (although potentially useful) ideasare rejected at an early stage by those assessingthem. Therefore, we emphasize that managersshould try to make decisions regarding ideasfor selection or discontinuation based on thegreatest possible degree of objective assessmentof the ideas. The framework we provide is auseful starting point for such deliberations. Itcan be used for deciding a new productstrategy, e.g., whether to pursue an innovationstrategy (N + U; N + U + MP) or not (N + MP;U + MP). It can also be used for consideringthe firmˈs project portfolio, including whetherit should consist only of new product proposalsthat are expected to lead directly to profit orwhether other innovative proposals are alsoworth pursuing, i.e., those that are novel anduseful but lack market potential. The lattermay create brand value to the firm.

In general, innovation in business is associ-ated with radical rather than incremental offer-ings, which implies an elevation of noveltyabove usefulness (Bilton, 2007). However, notall offerings are or need to be radically new tobring value to the recipients or to the firm,which again implies that a product does nothave to excel on all criteria. Magnusson (2009)suggests that for radical innovation, originality(novelty) is the most important factor, whereasoriginality is, by definition, low for incrementalinnovation for which user value (usefulness)matters the most.

We looked at the student projects that wereassessed at 75% or above on the three criteria.This led to only seven product ideas with thepotential for arriving at innovation performanceaccording to our framework in terms of highnovelty, usefulness and market potential. Thefindings substantiate the claim by Fleming(2007, p. 69) that radically new products arerarely seen, which may be because ‘almost allinventions [ideas for new combinations] areuseless; a few are of moderate value; and onlya very, very few are breakthroughs.’

In the sample, there are an additional 18 casesof high novelty but low or medium usefulnessand market potential, as well as a few cases ofhigh novelty and usefulness but low ormediummarket potential. These product ideas wouldnot be candidates for innovation performanceaccording to our framework, as they are notrated high enough on all three criteria.However, as mentioned, we suggest that itmay be too early to merely disregard ideas thatare not rated high on, for example, usefulnessand market potential. The criterion-concept isto be seen merely as a means to make the firstassessments of new product proposals andshould not be used for instantaneous killing ofideas. Some novel ideas may turn out to behighly valuable to the users and to the firm even

though such potential results are not readilyapparent when screening the idea. Focusingmerely on novelty (and thus ignoring the itera-tive process of new product development) willalso lead to an even more skewed distributionof ideas (Fleming, 2007). A further investigationof the potential of highly novel ideasmay reveal(not yet thought of) areas of use and marketpotential. Moreover, it is easy to imagine thatideas with high novelty, high usefulness andhigh market potential may, after the entireproduct development process, end upwith onlya mediocre outcome or even just incrementalinnovation. Hence, the insights gained anddecisions made throughout the product devel-opment process, along with the resultsachieved, potentially reduce the radicalness ofthe final offering to the market. An importantfurther line of research is needed to establishthis link between the creativity of an idea andthe radicalness of the product adopted by theusers. Such research will require access tospecific product development projects and theability to study these over an extended periodof time. The value of performing such researchis nevertheless potentially very important forprogressing an understanding of how creativeideas lead to innovation performance.

To sum up, our research points to the follow-ing two prominent research topics:

1. Theoretical arguments for, and empiricalresearch on, uneven weighting of criteria.

2. Empirical research on the link betweenassessment criteria for identification ofinnovation performance, in particularhow different criteria support either incre-mental or radical product innovation.

Studying Student-Generated ProductProposals and Potential Limitations

The student setting was chosen for our investi-gation due to its resemblance to firmsˈ newproduct development teams that are oftenheterogeneous with regard to expertise and, tosome extent, nationality. The teams for thisstudy were composed of individuals special-ized within different study areas, such assoftware engineering, mechanical engineering,design engineering and product innovation,but also with some students having moreextensive training in business aspects. Thecontrolled setting (allowing for differences ofqualifications, nationality and age), combinedwith the aim of the projects, makes it a solidand relevant area for investigation of theresearch focus. Moreover, the study hasallowed us to collect a sufficient number ofprojects for analysing the criteria at this earlystage of conceptualization and validation,



which would have been extremely difficult toobtain from a firm setting. Therefore, we arguethat despite its constructed nature, the studentsetting has allowed us to investigate the criteriaand establish the framework, which we may inlater studies apply in a business setting forfurther validation and application relating tothe implications for innovation managers andprofessionals.

Even though this study is of an exploratorynature, it is a shortcoming that we used onlyone assessor per product idea. However, eachassessor can be regarded as an industry andmarket expert and therefore also as capable ofassessing novelty, usefulness andmarket poten-tial of product ideas. We do, however, urgefuture studies to use more than one assessor inorder to be able to check for inter-raterreliability.

Notes

1. Extract from the (most recent) course description:http://www.sdu.dk/om_sdu/fakulteterne/teknik/ledelse_administration/administration/studieordninger_a/pdi_civbach/moduler_e15

2. The students were: Christian EnglundChristensen, Rafik Daka, Ahmad OmarEl-Kassem, Mikkel Wiggers Hyldgaard, SinisaPopadic and one more student. The latter studentdid not wish to be mentioned by name. They haveall kindly given permission to include the excerptof their project report in this article.

3. The students were Simon Falden, Ivar ÖrnPálsson, Michael Rasmussen, and Dlair Younus.They have all kindly given permission to includethe excerpt of their project report in this article.

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Marianne Harbo Frederiksen ([email protected]) is Associate Professor at the Departmentof Technology and Innovation at the Univer-sity of Southern Denmark. Her researchfocuses on creativity and idea managementthroughout the innovation process. Inaddition, she focuses on the emergence ofeco-systems and the market potential fornew technologies. She has an MSc in Archi-tecture with a specialization within indus-trial design from the Aarhus School ofArchitecture in Denmark. She has been co-owner of a design company and has workedin and together with several industries as adesigner and R&D Manager. She has alsobeen an adviser in public-private researchprojects focusing on the development of usescenarios, ideation, idea development,implementation, mapping of userexperiences, and other aspects related tonew product development.Mette Præst Knudsen ([email protected])

is Professor of Innovation Management andDirector of the Centre for Integrative Innova-tionManagement, Department ofMarketing&Management at theUniversity of SouthernDenmark. Her research focuses on open in-novation and ways to operationalize open-ness in firmsˈ innovation activities. As partof this research, she is also concerned withthe relationship qualities and knowledge-sharing abilities of the partners involved inopen innovation projects. She has also inves-tigated the links between creativity, organiz-ing for creativity, and the effects oninnovation performance. Finally, herresearch is concerned with the emergenceof eco-systems for new technologies andthe development of commercializationcapabilities of firms. Her research has beenpublished in journals such as Journal of Prod-uct Innovation Management, Technovation,International Journal of Engineering andTechnology Management and Industrial andCorporate Change.



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